Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Apr. 03, 2019 | Jun. 30, 2018 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2018 | ||
Entity Registrant Name | EVOLVING SYSTEMS INC | ||
Trading Symbol | evol | ||
Entity Central Index Key | 0001052054 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 17,708,979 | ||
Entity Common Stock, Shares Outstanding | 12,161,176 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 6,732 | $ 7,562 |
Contract receivables, net of allowance for doubtful accounts of $771 and $970 at December 31, 2018 and December 31, 2017, respectively | 7,757 | 10,151 |
Unbilled work-in-progress, net of allowance for doubtful accounts of $551 and $107 at December 31, 2018 and December 31, 2017, respectively | 3,044 | 5,823 |
Prepaid and other current assets | 1,351 | 1,633 |
Income taxes receivable | 1,137 | |
Total current assets | 20,021 | 25,169 |
Property and equipment, net | 303 | 258 |
Amortizable intangible assets, net | 4,550 | 5,613 |
Goodwill | 6,738 | 25,216 |
Deferred income taxes, net | 1,140 | 274 |
Total assets | 32,752 | 56,530 |
Current liabilities: | ||
Term loans - current portion | 3,573 | 2,805 |
Accounts payable and accrued liabilities | 4,483 | 6,678 |
Contingent earn-out | 396 | |
Unearned revenue | 3,911 | 5,397 |
Income taxes payable | 899 | |
Total current liabilities | 11,967 | 16,175 |
Long-term liabilities: | ||
Term loans, net of current portion | 2,365 | 5,942 |
Total liabilities | 14,332 | 22,117 |
Commitments and contingencies (Note 11) | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value; 2,000,000 shares authorized; no shares issued and outstanding as of December 31, 2018 and December 31, 2017, respectively | ||
Common stock, $0.001 par value; 40,000,000 shares authorized; 12,303,722 shares issued and 12,124,833 outstanding as of December 31, 2018 and 12,119,961 shares issued and 11,941,072 outstanding as of December 31, 2017 | 12 | 12 |
Additional paid-in capital | 99,224 | 98,517 |
Treasury stock, 178,889 shares as of December 31, 2018 and December 31, 2017, at cost | (1,253) | (1,253) |
Accumulated other comprehensive loss | (10,115) | (8,202) |
Accumulated deficit | (69,448) | (54,661) |
Total stockholders' equity | 18,420 | 34,413 |
Total liabilities and stockholders' equity | $ 32,752 | $ 56,530 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Consolidated Balance Sheets [Abstract] | ||
Allowance for doubtful accounts receivable | $ 771 | $ 970 |
Allowance for doubtful unbilled work-in-progress | $ 551 | $ 107 |
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 | 12,305,597 | 12,119,961 |
Common stock, shares outstanding | 12,126,708 | 11,941,072 |
Treasury stock, shares | 178,889 | 178,889 |
Consolidated Statements Of Oper
Consolidated Statements Of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
REVENUE | ||
Total revenue | $ 30,636 | $ 28,812 |
COSTS OF REVENUE AND OPERATING EXPENSES | ||
Costs of revenue, excluding depreciation and amortization | 10,349 | 8,680 |
Sales and marketing | 6,592 | 5,214 |
General and administrative | 6,677 | 6,065 |
Product development | 4,170 | 2,042 |
Depreciation | 121 | 250 |
Amortization | 970 | 860 |
Restructuring | 286 | |
Goodwill impairment loss | 17,760 | |
Total costs of revenue and operating expenses | 46,639 | 23,397 |
(Loss) income from operations | (16,003) | 5,415 |
Other income (expense) | ||
Interest income | 65 | 1 |
Interest expense | (478) | (365) |
Other income | 393 | 23 |
Foreign currency exchange income (loss) | 810 | (1,137) |
Other income (expense), net | 790 | (1,478) |
(Loss) income from operations before income taxes | (15,213) | 3,937 |
Income tax (benefit) expense | (426) | 1,421 |
Net (loss) income | $ (14,787) | $ 2,516 |
Basic (loss) income per common share - net (loss) income | $ (1.22) | $ 0.21 |
Diluted (loss) income per common share - net (loss) income | $ (1.22) | $ 0.21 |
Weighted average basic shares outstanding | 12,108,000 | 11,934,000 |
Weighted average diluted shares outstanding | 12,108,000 | 11,981,000 |
License Fees [Member] | ||
REVENUE | ||
Total revenue | $ 1,433 | $ 3,438 |
Services [Member] | ||
REVENUE | ||
Total revenue | $ 29,203 | $ 25,374 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive (Loss) Income - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Consolidated Statements Of Comprehensive (Loss) Income [Abstract] | ||
Net (loss) income | $ (14,787) | $ 2,516 |
Other comprehensive (loss) income | ||
Foreign currency translation (loss) income | (1,913) | 1,790 |
Comprehensive (loss) income | $ (16,700) | $ 4,306 |
Consolidated Statements Of Chan
Consolidated Statements Of Changes In Stockholders' Equity - 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 | |||||
Stock option exercises | 30 | 30 | ||||
Stock option exercises, shares | 32,904 | |||||
Common stock issued pursuant to the Employee Stock Purchase Plan | 2 | 2 | ||||
Common stock issued pursuant to the Employee Stock Purchase Plan, shares | 777 | |||||
Share-based compensation expense | 742 | 742 | ||||
Net (loss) income | 2,516 | 2,516 | ||||
Foreign currency translation loss | 1,790 | 1,790 | ||||
Balance at Dec. 31, 2017 | $ 12 | 98,517 | (1,253) | (8,202) | (54,661) | $ 34,413 |
Balance, shares at Dec. 31, 2017 | 11,941,072 | 11,941,072 | ||||
Stock option exercises | 4 | $ 4 | ||||
Stock option exercises, shares | 9,676 | |||||
Common stock issued pursuant to the Employee Stock Purchase Plan | 1 | 1 | ||||
Common stock issued pursuant to the Employee Stock Purchase Plan, shares | 85 | |||||
Restricted stock vested | ||||||
Restricted stock vested, shares | 175,875 | |||||
Share-based compensation expense | 702 | 702 | ||||
Net (loss) income | (14,787) | (14,787) | ||||
Foreign currency translation loss | (1,913) | (1,913) | ||||
Balance at Dec. 31, 2018 | $ 12 | $ 99,224 | $ (1,253) | $ (10,115) | $ (69,448) | $ 18,420 |
Balance, shares at Dec. 31, 2018 | 12,126,708 | 12,126,708 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net (loss) income | $ (14,787) | $ 2,516 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation | 121 | 250 |
Amortization of intangible assets | 970 | 860 |
Amortization of debt issuance costs | 9 | 13 |
Share-based compensation expense | 702 | 742 |
Change in fair value of contingent earn-out | 413 | (4) |
Payment of contingent purchase consideration | (445) | |
Unrealized foreign currency transaction (income) loss, net | (810) | 1,136 |
Bad debt expense, net | 431 | 861 |
Elimination of Telespree liability | (496) | |
Provision for deferred income taxes | (946) | (491) |
Goodwill impairment loss | 17,760 | |
Change in operating assets and liabilities: | ||
Contract receivables | 2,473 | (2,971) |
Unbilled work-in-progress | 1,803 | (1,032) |
Prepaid and other assets | (25) | 1,983 |
Accounts payable and accrued liabilities | (1,326) | (1,905) |
Income taxes receivable | (2,036) | 264 |
Unearned revenue | (1,244) | 856 |
Other long-term obligations | 380 | |
Net cash provided by operating activities | 2,567 | 3,458 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of property and equipment | (185) | (80) |
Business combinations, net of cash received | (5,936) | |
Net cash used in investing activities | (185) | (6,016) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Capital lease payments | (1) | |
Payment of contingent earn-out | (380) | |
Principal payments on notes payable | (2,788) | (2,025) |
Proceeds from term loans | 4,730 | |
Proceeds from the issuance of stock | 5 | 33 |
Net cash (used in) provided by financing activities | (3,163) | 2,737 |
Effect of exchange rate changes on cash and cash equivalents | (49) | (231) |
Net decrease in cash and cash equivalents | (830) | (52) |
Cash and cash equivalents at beginning of period | 7,562 | 7,614 |
Cash and cash equivalents at end of period | 6,732 | 7,562 |
Supplemental disclosure of cash and non-cash transactions: | ||
Interest paid | 499 | 345 |
Income taxes paid | 887 | $ 1,504 |
Measurement period adjustment to goodwill and intangible assets | $ 281 |
Organization And Summary Of Sig
Organization And Summary Of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Organization And Summary Of Significant Accounting Policies [Abstract] | |
Organization And Summary Of Significant Accounting Policies | NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization — Evolving Systems, Inc. (the “Company”) is a provider of real-time digital engagement solutions and services of software solutions and services to the wireless carrier and consumer financial services markets. We maintain long-standing relationships with many of the largest wireless companies worldwide. The Company’s portfolio includes market-leading solutions and services for real-time analytics, customer acquisition and activation, customer value management and loyalty for the telecom industry promoting partnerships into retail and financial services. 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 capital expenditure license and services to operating expenditure models based on recurring managed services with performance fees. Our software solution platforms enable carriers’ marketing departments to innovate, execute and manage highly-personalized and contextually-relevant, interactive campaigns that engage consumers in real-time, and enhance customer retention through deploying loyalty programs. 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”). In July 2017 we completed the acquisition of Business Logic Systems (“BLS”). BLS, headquartered in Newbury, United Kingdom, 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. In September 2017 we completed 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. We believe the acquisitions of BLS and the Lumata Entities further reinforced 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 more than 100 customers spanning 65 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. 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. Business Combinations – I n July 2017 and September 2017 we acquired Business Logic Systems which became BLS Limited (“EVOL BLS”) and the four business operating units of Lumata Holdings Ltd. These business combinations are reflected in these consolidated financial statements since the acquisition date. Refer to Note 2, Acquisitions, for more information regarding the acquisitions. We account for business combinations in accordance with the acquisition method. The acquisition method of accounting requires that assets acquired, and liabilities assumed be recorded at their fair values on the date of a business acquisition. The excess of the purchase price over the fair value of assets acquired is recognized as goodwill. Certain adjustments to the assessed fair values of the assets and liabilities made subsequent to the acquisition date, but within the measurement period, which is up to one year, are recorded as adjustments to goodwill. Any adjustments subsequent to the measurement period are recorded in income. Our consolidated financial statements and results of operations reflect an acquired business from the completion date of an acquisition. The judgments that we make in determining the estimated fair value assigned to each class of assets acquired and liabilities assumed, as well as asset lives, can materially impact net income in periods following a business combination. We generally use either the income, cost or market approach to aid in our conclusions of such fair values and asset lives. The income approach presumes that the value of an asset can be estimated by the net economic benefit to be received over the life of the asset, discounted to present value. The cost approach presumes that an investor would pay no more for an asset than its replacement or reproduction cost. The market approach estimates value based on what other participants in the market have paid for reasonably similar assets. Although each valuation approach is considered in valuing the assets acquired, the approach ultimately selected is based on the characteristics of the asset and the availability of information. 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 progress toward completion and direct profit or loss on contracts, 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, generally, 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 income (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 (loss) in the period in which they occur. Principles of Consolidation — The 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. Reclassification — Certain reclassifications have been made to conform the 2017 amounts to the 2018 classifications for comparative purposes. 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 an other than temporary decline in our market capitalization that is calculated as our common stock’s market price multiplied by the number of shares of common stock outstanding, 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. In 2018, the Company adopted ASU 2017-04, Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment, which simplifies the subsequent measurement of goodwill by eliminating the second step from the quantitative goodwill impairment test. Under this guidance, annual or interim goodwill impairment testing will be performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge will then be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value, not to exceed the carrying value of goodwill. 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., EVOL BLS and the Lumata Entities. These assets are amortized using the straight-line method over their estimated lives. We assess 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 — Effective January 1, 2018, we adopted Financial Accounting Standards Board (“FASB”) Topic 606, Revenue from Contacts with Customers (“ASC 606”). ASC 606 was applied using the modified retrospective method. Accordingly, comparative periods have not been adjusted and continue to be reported under FASB ASC Topic 605, Revenue Recognition (“ASC 605”). There was no cumulative effect of the initial application to be recognized as an adjustment to opening retained earnings at January 1, 2018 as the adoption did not have a material impact on the Company’s results of operations or financial condition. The majority of our license fees and services revenue is generated from fixed-price contracts, this provides for licenses to our software products and services that customize such software to meet our customers’ needs. In most instances, customization services are determined to be essential to the functionality of the delivered software. Under ASC 606, revenue is recognized when our customer obtains control of promised goods or services in an amount that reflects the consideration we expect to receive in exchange for those goods or services. We measure revenue based on consideration specified in a contract with a customer and exclude any sales incentives. Furthermore, we recognize revenue when we satisfy a performance obligation by transferring control over the service to our customer. A performance obligation is a promise in a contract to transfer a distinct service to the customer. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as the customer receives the benefit of the performance obligation. Our customers typically receive the benefit of our services as they are performed. Substantially all customer contracts provide that we are compensated for services performed to date. Losses on fixed-price projects are recorded when identified. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by us from a customer, are excluded from revenue. Nature of goods and services The following is a description of our products and services from which we generate revenue, as well as the nature, timing of satisfaction of performance obligations, and significant payment terms for each: i. License Revenue License fees represent the fees we receive from the licensing of our software products. In most instances, customization services are determined to be essential to the functionality of the delivered software. The license along with the customization services are transferred to our customers over time. In arrangements where the services are not essential to the functionality of the delivered software, we recognize license revenue when the license agreement has been approved and the software has been delivered. We can identify each party’s rights, payment terms, and commercial substance of the content. Where applicable, we identify multiple performance obligations and record as revenue as the performance obligations are fulfilled based on their estimated allocated value. The selection of the method to measure progress towards completion requires judgment and is based on the extent of progress towards completion of the performance obligation. ii. Customer Support Revenue Customer support services includes annual support fees, recurring maintenance fees, warranty support fees and minor product upgrades. The warranty support fees represent a separate performance obligation that is provided for up to a year with initial license purchase. The Company allocates the contract transaction price related to warranty support fees based on pricing consistent with what we would offer to other market participants. Upon the conclusion of the warranty period, the customer can choose to continue to receive support and maintenance services via our customer support offerings. We recognize revenue from our support ratably over the service contract period. iii. Services Revenue We recognize revenue from fixed-price service contracts using the input method of accounting. Under the input method, revenue is recognized revenue on the basis of an entity’s efforts or inputs toward satisfying a performance obligation. 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 performance obligation to our customers under such arrangements is fulfilled. iv. Managed Services We recognize revenue from our managed services contracts primarily 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 input method of accounting, as previously described. Disaggregation of revenue In the following table, revenue is disaggregated by primary geographical market, major products/service lines, and timing of revenue recognition (in thousands): For the Years Ended December 31, 2018 2017 Primary geographical markets United Kingdom $ 6,222 $ 5,521 Other 24,414 23,291 $ 30,636 $ 28,812 Major products/service lines Licensing fees $ 1,433 $ 3,438 Customer support, including warranty support fees 9,984 9,134 Services 8,880 8,711 Managed services 10,339 7,529 Total services 29,203 25,374 $ 30,636 $ 28,812 Timing of revenue recognition Products transferred at a point in time $ 882 $ 914 Products and services transferred over time 29,754 27,898 $ 30,636 $ 28,812 Contract balances The following table provides information about receivables, assets, and liabilities from contracts with customers (in thousands): December 31, 2018 December 31, 2017 Assets Contract receivables, net $ 7,757 $ 10,151 Unbilled work-in-progress, net $ 3,044 $ 5,823 Liabilities Unearned revenue $ 3,911 $ 5,397 Contract receivables are recorded at the invoiced amount and do not bear interest. Credit is extended based on the evaluation of a customer’s financial condition and collateral is not required. Unbilled work-in-progress is revenue which has been earned but not invoiced. The contract assets are transferred to the receivables when invoiced. The contract liabilities primarily relate to unearned revenue. Amounts billed in advance of performance obligations being satisfied are booked as unearned revenue. Transaction price allocated to the remaining performance obligations Remaining performance obligations represent the transaction price of firm orders for which work has not been performed as of the period end date and excludes unexercised contract options and potential orders under ordering-type contracts (e.g., indefinite-delivery, indefinite-quantity). As of December 31, 2018, the aggregate amount of the transaction price allocated to remaining performance obligations with lives greater than one-year totals $1.5 million. The Company expects approximately 80% of remaining performance obligations to be recognized into revenue within the next twelve months, with the remaining 20% recognized thereafter. We apply the practical expedient in paragraph ASC 606-10-50-14 and do not disclose information about remaining performance obligations that have original expected durations of one-year or less. We apply the transition practical expedient in paragraph ASC 606-10-65-1(f)(3) and do not disclose the amount of the transaction price allocated to the remaining performance obligations and an explanation of when we expect to recognize that amount as revenue. Additionally, applying the practical expedient in paragraph ASC 340-40-25-4, the Company recognizes the incremental costs of obtaining contracts (i.e., commissions) as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one-year or less. Allowance for Doubtful Accounts — We make judgments related to our ability to collect outstanding accounts receivable and unbilled work-in-progress. We provide allowances for receivables when their collection becomes doubtful by recording an expense. We determine the allowance based on our assessment of the realization of receivables using historical information and current economic trends, including assessing the probability of collection from customers. If the financial condition of our customers were to deteriorate, resulting in an impairment of their ability to make payments owed to us, an increase in the allowance for doubtful accounts would be required. We evaluate the adequacy of the allowance regularly and make adjustments accordingly. Adjustments to the allowance for doubtful accounts could materially affect our results of operations. The following table reflects the activity in the allowance for doubtful accounts: Balance at Bad Debt Write-Offs Charged Effects of Foreign Currency Balance at Fiscal Beginning Expense/ to Exchange End of Year Description of Period (Recovery) Allowance Rates Period 2018 Allowance for doubtful accounts $ 970 $ (86) $ (124) $ 11 $ 771 2017 Allowance for doubtful accounts $ 221 $ 789 $ (41 ) $ 1 $ 970 The following table reflects the activity in the allowance for unbilled work-in-progress: Balance at Unbilled Work-in- Progress Write-Offs Charged Effects of Foreign Currency Balance at Fiscal Beginning Allowance/ to Exchange End of Year Description of Period (Recovery) Allowance Rates Period 2018 Allowance for unbilled work-in-progress $ 107 $ 454 $ 2 $ (11) $ 552 2017 Allowance for unbilled work-in-progress $ — $ 107 $ — $ — $ 107 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. In March 2016, the FASB issued ASU 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. Stock-based payments made to non-employees, including grants of stock options, are recognized in the statements of operations based on their estimated fair values. The fair value of these options will be re-measured on each reporting date until the options vest. The re-measured fair value will be recognized as compensation expense over the remaining vesting term of the options. Comprehensive Income (Loss) — Comprehensive income consists of two components, net income and other comprehensive income (loss). Other comprehensive income 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. Concentration of Credit Risk — Financial instruments that potentially subject us to concentrations of credit risk consist primarily of contract receivables and unbilled work-in-progress. We perform on-going evaluations of customers’ financial condition and, generally, require no collateral from customers. A substantial portion of our revenue is from a limited number of customers, all in the telecommunications industry. For the year ended December 31, 2018, one significant customer accounted for 11% of revenue from operations. This customer is a large telecommunications operator in Europe. For the year ended December 31, 2017, one significant customer accounted for 11% of revenue from operations. This customer is a large telecommunications operator in Europe. As of December 31, 2018, and 2017 no customers accounted for 10% of contract receivables and unbilled work-in-progress. We are subject to concentration of credit risk with respect to our cash and cash equivalents, which we attempt to minimize by maintaining our cash and cash equivalents with institutions of sound financial quality. At times, cash balances may exceed limits federally insured by the Federal Deposit Insurance Corporation (“FDIC”). Our cash and cash equivalents are not under any FDIC program were $ 6.5 million and $5.4 million as of December 31, 2018 and 2017, respectively. Sales, Use and Other Value Added Tax — Applicable revenue-based state, use and other value added taxes are included in revenue. Advertising and Promotion Costs — Advertising and promotion costs are expensed as incurred. Advertising costs totaled approximately $0.2 million and $0.1 million for the years ended December 31, 2018 and 2017, respectively. Capitalization of Internal Software Development Costs — We expend amounts on product development, particularly for new products and/or for enhancements of existing products. For internal development of software products that are to be licensed by us, we expense the cost of developing software prior to establishing technological feasibility and those costs are capitalized once technological feasibility has been established. Capitalization ceases upon general release of the software. The determination of whether internal software development costs are subject to capitalization is, by its nature, highly subjective and involves significant judgments. This decision could significantly affect earnings during the development period. Further, once capitalized, the software costs are generally amortized on a straight-line basis over the estimated economic life of the product. The determination of the expected useful life of a product is highly judgmental. Finally, capitalized software costs must be assessed for impairment if facts and circumstances warrant such a review. We did no t capitalize any internal software development costs during the two years ended December 31, 2018. In addition, we did not have any capitalized internal software development costs included in our December 31, 2018 and 2017 Consolidated Balance Sheets. We believe that during these periods no material internal software development costs were required to be capitalized. Our conclusion is primarily based on the fact that the feature−rich, pre−integrated, and highly−scalable nature of our products requires that our development efforts include complex design, coding and testing methodologies, which include next generation software languages and development tools. Development projects of this nature carry a high degree of development risk. Substantially all of our internal software development efforts are of this nature, and therefore, we believe the period between achieving technological feasibility and the general release of the software to operations is so short that any costs incurred during this period are not material. Property and Equipment and Long-Lived Assets — Property and equipment are stated at cost or estimated fair value if acquired in an acquisition, less accumulated depreciation, and are depreciated over their estimated useful lives, or the lease term, if shorter, using the straight-line method. Leasehold improvements are stated at cost, less accumulated amortization, and are amortized over the shorter of the lease term or estimated useful life of the asset. Maintenance and repair costs are expensed as incurred. We review our long-lived assets, such as property and equipment and purchased intangible assets subject to amortization, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. We evaluate the recoverability of an asset or asset group by comparing its carrying amount to the estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset or asset group exceeds its estimated future cash flows, we recognize an impairment charge as the amount by which the carrying amount of the asset exceeds the estimated fair value of the asset. 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 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 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. Recently Adopted Accounting Pronouncements — In May 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers, Topic 606 and various updates to the ASU thereafter. We adopted the new standard effective January 1, 2018, using the modified retrospective transition method. Accordingly, comparative periods have not been adjusted and continue to be reported under FASB ASC Topic 605, Revenue Recognition (“ASC 605”). There was no cumulative effect of the initial application to be recognized as an adjustment to opening retained earnings at January 1, 2018 as the adoption did not have a material impact on the Company’s results of operations or financial condition. In November 2016, the FASB issued ASU 2016-18, Restricted Cash (Topic 230): Statement of Cash Flows (“ASU 2016-18”). ASU 2016-18 requires that a statement of cash flows |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2018 | |
Acquisitions [Abstract] | |
Acquisitions | NOTE 2 — ACQUISITIONS Business Logic Systems On July 3, 2017, we completed the purchase by EVOL BLS, a wholly owned subsidiary of 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 agreed to 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 $0.3 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. During the second quarter of 2018, we identified and recorded measurement period adjustments to our preliminary purchase price allocation that was disclosed in our Form 10-K for the fiscal year ended December 31, 2017. These adjustments are reflected in the tables below. If the measurement period adjustments were reflected in the previously filed Form 10-K, it would have increased operating expenses by approximately $1,000 consisting of increases to amortization expense. The measurement period adjustments were the result of additional analysis performed and updated information. When we acquired EVOL BLS on July 3, 2017, we agreed to make up to three annual cash payments equal to 50% of the EVOL BLS revenue in excess of $4.8 million for the 12-month periods ending July 3, 2018, 2019 and 2020. The Company also agreed to guarantee the EVOL BLS obligations under the Purchase Agreement. As of June 30, 2018, we estimated the total annual cash payments for the three 12-month periods to be $0.8 million which is a $0.4 million increase from our $0.4 million estimate as of December 31, 2017. We recognized $0.4 million expense in the other income (expense) financial statement line item for the fiscal year ending December 31, 2018 as a result of our increased obligation. On November 2, 2018, we paid the $0.8 million in contingent earn-out liability for the EVOL BLS acquisition. No future payments are expected at this time. The following table summarizes the purchase price and fair values of the assets acquired and liabilities assumed at the date of acquisition as adjusted for measurement period adjustments identified during the current year (in thousands): At July 3, 2017 (preliminary) Measurement Period Adjustments At July 3, 2017 (adjusted) Cash Consideration Total Cash Consideration $ 1,553 $ - $ 1,553 Earnout 380 47 427 Total purchase price $ 1,933 $ 47 $ 1,980 At July 3, 2017 (preliminary) Measurement Period Adjustments At July 3, 2017 (adjusted) Contract receivables $ 1,037 $ - $ 1,037 Unbilled work-in-progress 1,039 - 1,039 Intangible assets 246 18 264 Prepaid and other current assets 437 - 437 Other assets, non-current 55 - 55 Total identifiable assets acquired 2,814 18 2,832 Accounts payable and accrued liabilities 792 - 792 Deferred revenue 338 - 338 Total identifiable liabilities acquired 1,130 - 1,130 Net identifiable assets acquired 1,684 18 1,702 Goodwill 249 29 278 Net assets acquired $ 1,933 $ 47 $ 1,980 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 less than $0.1 million related to the acquired intangible assets was recorded for the years ended December 31, 2018 and 2017. The $0.3 million of the goodwill recognized was attributed primarily to expected synergies and the assembled workforce of EVOL BLS. Goodwill was adjusted by less than $0. 1 million related to changes in the opening client balances for contract receivables and unbilled work in progress. Intangible assets related to the EVOL BLS’s acquisition as of December 31, 2018 and 2017 were as follows (in thousands): Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 98 $ 29 $ 69 4 yrs. Trademarks and tradenames 9 9 - 0 yrs. Non-competition 4 3 1 1 yrs. Customer relationships 149 32 117 6 yrs. $ 260 (1) $ 73 (1) $ 187 4.9 yrs. Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 102 $ 9 $ 93 5 yrs. Trademarks and tradenames 10 7 3 0.5 yrs. Non-competition 4 1 3 1.5 yrs. Customer relationships 139 8 131 7 yrs. $ 255 $ 25 $ 230 5.9 yrs. (1) Includes functional currency adjustment of less than $0.1 million. Lumata 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 ( $4.8 million), subject to certain adjustments. The Seller and certain members of the Seller’s management entered into Management Warranty Deeds to secure Lumata Holdings’ representations and warranties under the Purchase Agreement and, to the extent the amounts provided under the Management Warranty Deeds are not sufficient to satisfy post-closing claims, EVOL Holdings may seek recovery from the Guarantor in an amount not to exceed €0.4 million ($ 0.5 million). 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 $3.1 million, was recorded as goodwill. 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. During 2018, we identified and recorded measurement period adjustments to our preliminary purchase price allocation that was disclosed in our Form 10-K for the fiscal year ended December 31, 2017. These adjustments are reflected in the tables below. If the measurement period adjustments were reflected in the Form 10-K, it would have resulted in no change in operating expenses. The measurement period adjustments were the result of additional analysis performed and information identified during the second quarter of 2018 based on facts and circumstances that existed as of the purchase date. The following table summarizes the purchase price and fair values of the assets acquired and liabilities assumed at the date of acquisition as adjusted for measurement period adjustments identified during the current year (in thousands): At September 4, 2017 (preliminary) Measurement Period Adjustments At September 4, 2017 (adjusted) Cash Consideration $ 4,766 $ - $ 4,766 Total purchase price $ 4,766 $ - $ 4,766 At September 4, 2017 (preliminary) Measurement Period Adjustments At September 4, 2017 (adjusted) Cash and cash equivalents $ 386 $ - $ 386 Contract receivables 1,444 - 1,444 Unbilled work-in-progress 110 (82) 28 Intangible assets 1,935 - 1,935 Prepaid and other current assets 1,539 - 1,539 Other assets, non-current 19 - 19 Total identifiable assets acquired 5,433 (82) 5,351 Accounts payable and accrued liabilities 3,086 - 3,086 Deferred tax liability 329 - 329 Deferred revenue 325 152 477 Total identifiable liabilities acquired 3,740 152 3,892 Net identifiable assets acquired 1,693 (234) 1,459 Goodwill 3,073 234 3,307 Net assets acquired $ 4,766 $ - $ 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 $0.2 million and less than $0.1 million related to the acquired intangible assets was recorded during the years ended December 31, 2018 and 2017, respectively. The $3.1 million of goodwill recognized is attributed to expected synergies and the assembled workforce and residual goodwill of the Lumata Entities. Goodwill was adjusted by $0.2 million related to changes in the opening client balances for contract receivables and unbilled work in progress. Intangible assets related to the Lumata Entities’ acquisition as of December 31, 2018 and 2017 (in thousands): Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 661 $ 126 $ 535 6 yrs. Trademarks and tradenames 109 29 80 4 yrs. Non-competition 2 2 - 0.5 yrs. Customer relationships 1,131 116 1,015 12 yrs. $ 1,903 (1) $ 273 (1) $ 1,630 9.4 yrs. Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 700 $ 33 $ 667 7 yrs. Trademarks and tradenames 115 8 107 5 yrs. Non-competition 2 - 2 1.5 yrs. Customer relationships 1,200 31 1,169 13 yrs. $ 2,017 (1) $ 72 (1) $ 1,945 10.4 yrs. (1) Includes functional currency adjustment of $0.1 million. Pro Forma The following table presents the unaudited pro forma results of the Company for the years ended December 31, 2018 and 2017 as if the acquisitions of EVOL BLS and Lumata Entities occurred on January 1, 2017. The pro forma results include estimates and assumptions which management believes are necessary. However, pro forma results do not include an anticipated cost savings or their effects of the planned integration of EVOL BLS and Lumata Entities and are not necessarily indicative of the result that would have occurred if the business combination had been in effect on the dates indicated, or which may result in the future. The unaudited pro forma revenue and net loss for EVOL BLS was approximately $1.4 million and $ 2.0 million, respectively, for the pre-acquisition period during 2017. The unaudited pro forma revenue and net loss for the Lumata Entities was approximately $4.6 million and $0.2 million, respectively, for the pre-acquisition period during 2017. However, the pro forma results do not include any anticipated cost savings or their effects of the planned integration of EVOL BLS and Lumata Entities and are not necessarily indicative of the results that would have occurred if the business combination had been in effect on the dates indicated, or which may result in the future. The pro forma information includes adjustments of $0.2 million in 2017 for the amortization of intangible assets. For the year Ended December 31, 2018 2017 Revenue $ 30,636 $ 34,821 Net (loss) income $ (14,787) $ 144 EVOL BLS or the Lumata Entities did not have any material, nonrecurring pro forma adjustments directly attributable to the business combination included in the reported pro forma revenue and earnings. |
Goodwill And Intangible Assets
Goodwill And Intangible Assets | 12 Months Ended |
Dec. 31, 2018 | |
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 3,322 Effects of changes in foreign currency exchange rates (1) 1,295 Balance at December 31, 2017 $ 25,216 Measurement period adjustments 263 Goodwill impairment loss (17,760) Effects of changes in foreign currency exchange rates (1) (981) Balance at December 31, 2018 $ 6,738 (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, 2018, at which time we had $25.0 million of goodwill. The fair value of the reporting unit was estimated using both market and income-based approaches. Due to a sustained decline in the market capitalization of our common stock during the fourth quarter of 2018, we performed an interim goodwill impairment test in accordance with the provisions of ASU 2017-04.The outcome of this goodwill impairment test resulted in a charge for the impairment of goodwill of $17.8 million, which was recorded in the consolidated financial statements for the year ended December 31, 2018. Management considered that, along with other possible factors affecting the assessment of the Company’s reporting unit for the purposes of performing a goodwill impairment assessment, including management assumptions about expected future revenue forecasts and discount rates, changes in the overall economy, trends in the stock price, estimated control premium and other operating conditions. Changes in estimates and assumptions could materially affect the determination of fair value and goodwill. Due to our transition of packaging our products and services into a single 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 additional events through the date this Form 10-K was filed which impact our assumptions on the determination of the fair value of our goodwill. We amortized identifiable intangible assets for Evolving Systems Labs, Evolving Systems NC, EVOL BLS, and the Lumata entities on a straight-line basis over their estimated lives ranging from one to eight years. As of December 31, 2018, and December 31, 2017, identifiable intangibles were as follows (in thousands): December 31, 2018 Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 2,877 $ (1,121) $ 1,756 6.7 yrs. Trademarks and tradenames 303 (223) 80 2.7 yrs. Non-competition 39 (38) 1 1.0 yrs. Customer relationships 4,303 (1,590) 2,713 7.7 yrs. $ 7,522 (1) $ (2,972) (2) $ 4,550 5.8 yrs. December 31, 2017 Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 2,921 $ (743) $ 2,178 7.7 yrs. Trademarks and tradenames 310 (189) 121 3.7 yrs. Non-competition 40 (35) 5 2.0 yrs. Customer relationships 4,363 (1,054) 3,309 8.7 yrs. $ 7,634 $ (2,021) $ 5,613 6.8 yrs. (1) 2018 increase in gross amount due to measurement period adjustments relating to the EVOL BLS purchase price allocation. See Note 2 — Acquisitions for additional information. Includes functional currency adjustment of $0.1 million (2) Includes functional currency adjustment of less than $0.1 million. Amortization expense of identifiable intangible assets was $1.0 million and $0.9 million for the years ended December 31, 2018 and 2017, respectively. Expected future amortization expense related to identifiable intangibles based on our carrying amount as of December 31, 2018 was as follows (in thousands): Year ending December 31, 2019 $ 938 2020 937 2021 923 2022 738 2023 360 Thereafter 654 $ 4,550 |
Balance Sheet Components
Balance Sheet Components | 12 Months Ended |
Dec. 31, 2018 | |
Balance Sheet Components [Abstract] | |
Balance Sheet Components | NOTE 4 — BALANCE SHEET COMPONENTS The components of accounts payable and accrued liabilities are as follows (in thousands): December 31, 2018 December 31, 2017 Accounts payable and accrued liabilities: Accounts payable $ 1,276 $ 1,530 Accrued compensation and related expenses 1,863 1,749 Accrued liabilities 1,344 3,399 $4,483 $6,678 |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2018 | |
Long-Term Debt [Abstract] | |
Long-Term Debt | NOTE 5 — LONG-TERM DEBT On August 16, 2017, we entered into a Term Loan Facility Agreement with East West Bank as lender in the amount of $4.7 million (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 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 $0.1 million that commenced on 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 December 31, 2018, the U.S.A. Prime Rate was 5.5% . 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 by 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 four 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 . 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 Term Loan bears interest at a floating rate equal to the U.S.A. Prime Rate plus 1.0% . As of December 31, 2018, the U.S.A. Prime Rate was 5.5% . The Term Loan is secured by substantially all of the assets of Evolving Systems, 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. Interest accrues from the date the Term Loan was made at the aforementioned rate and is 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. 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 and a legal fee equal to less than $0.1 million . The Term Loan matures on January 1, 2020 . The Term Loan and the Loan Facility (collectively, “Loans”) include 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. As of December 31, 2018, we are in compliance with the covenants except for our fixed charge coverage ratio, which was 0.81 and failed to meet the minimum requirement of 1.25 fixed charge coverage ratio for the quarter ended December 31, 2018. On March 29, 2019, we received a letter from East West Bank that waived the violation. We are negotiating amendments to the 2019 quarterly ratios. We have a $5.9 million balance under the Term Loan, net of approximately $5,000 of debt issuance costs. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Taxes [Abstract] | |
Income Taxes | NOTE 6 − INCOME TAXES We recorded net income tax benefit of $0.4 million for the year ended December 31, 2018 and net income tax expense of $1.4 million for the year ended December 31, 2017. The net benefit for the year ended December 31, 2018 consisted of current income tax expense of $0.5 million and a deferred tax benefit of $0.9 million. The current tax expense consists of income tax primarily from our U.S. and U.K. based operations. The deferred tax benefit primarily consists of benefits from establishing deferred tax assets of $0.5 million for our foreign tax credit (“FTC”) carryforwards, $0.2 million for net operating losses from certain U.K. subsidiaries that are expected to be used by another U.K. subsidiary and $0.2 million decrease in net deferred tax liabilities. The net expense during the year ended December 31, 2017 consisted of current income tax expense of $1.9 million and a deferred tax benefit of $0.5 million. The current tax expense consists of income tax from our U.S., U.K., France and India based operations and unrecoverable foreign withholding taxes in the U.K. 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. On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted in the United States. The Tax Act includes a number of changes to existing U.S. tax laws that impact the Company including the reduction of the U.S. corporate income tax rate from 34 percent to 21 percent for tax years beginning after December 31, 2017. The Tax Act also provides for a one-time transition tax on indefinitely reinvested foreign earnings and the acceleration of depreciation for certain assets placed into service after September 27, 2017, as well as prospective changes beginning in 2018, including the elimination of certain domestic deductions and credits, capitalization of research and development expenditures, and additional limitations on the deductibility of executive compensation and interest. We adjusted our deferred tax assets and liabilities in the U.S. at December 31, 2017, using the new federal corporate tax rate of 21%. Global Intangible Low-taxed Income We recognize the tax on global intangible low-taxed income (“GILTI”) as a period cost in the period the tax is incurred. Under this policy, we have not provided deferred taxes related to temporary differences that upon their reversal will affect the amount of income subject to GILTI in the period. For the year ended December 31, 2018, there is no GILTI inclusion. Transfer pricing adjustments, net The Company's tax positions include the Company's intercompany transfer pricing policies and the associated taxable income and deductions arising from intercompany charges between subsidiaries within the consolidated group. During fiscal 2018, the Company finalized an Advance Pricing Arrangement ("APA") with the Evolving Systems, Inc. and its subsidiaries. This APA determined the amount of income which is taxable in each respective jurisdiction. In accordance with the APA, the adjustments necessary to reflect the reduction in 2018 U.S. pre-tax income in the resulted in an increase in domestic income before income tax expense of $5.5 million and a corresponding decrease in foreign income before income tax expense in the year ended 2018. The pre-tax (loss) income on which the provision for income taxes was computed is as follows (in thousands): For the Years Ended December 31, 2018 2017 Domestic $ (17,820) $ (4,168) Foreign 2,607 8,105 Total $ (15,213) $ 3,937 The expense (benefit) from continuing operations for income taxes consists of the following (in thousands): For the Years Ended December 31, 2018 2017 Current: Federal $ 340 $ (108) Foreign 155 1,998 State 25 22 Total Current 520 1,912 Deferred: Federal 41 (444) Foreign (987) (47) Total Deferred (946) (491) Total $ (426) $ 1,421 As of December 31, 2018, and 2017 we had no Federal NOL carryforwards remaining. As of December 31, 2018, and 2017, we had state NOL’s of approximately $27.5 million and $28.9 million, respectively. The state NOL carryforwards expire at various times beginning in 2019 and ending in 2037 . As of December 31, 2018, and 2017, we had foreign NOLs of $5.5 million and $5,6 million, respectively. The foreign NOL carryforwards expire at various times beginning in 2019 and ending in 2037 . In addition, we have research and experimentation credit carryforwards of approximately $0.3 million which may expire in 2019 and Alternative Minimum Tax (“AMT”) credits of $0.8 million. For tax years beginning after 2018 and before 2023, the AMT credit is refundable in an amount equal to 50% of excess of the credit for the tax year over the amount of the credit allowable for the year against regular tax liability. In our U.S. Federal income tax returns we historically deducted income taxes paid to various countries. 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 (“Foreign Tax Credit” or “FTC”). An election to either claim a deduction or FTC on such foreign income taxes can be made each tax year, independent from elections made in other years. An FTC 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. As the election to claim the FTC or deduction is made on an annual basis, we intend to compare benefits to either claim a deduction or FTC on an annual basis. We had approximately $4.8 million of FTC’s to carryforward into 2019 and subsequent years as a deferred tax asset. As of December 31, 2018, our FTC deferred tax asset balance was approximately $0.5 million, net of its valuation allowance. We utilized $0.5 million of Foreign Tax Credits for the year ended December 31, 2017 to offset the one-time transition tax on indefinitely reinvested and unrepatriated foreign earnings. The determination of the transition tax required analysis regarding the amount and composition of our historical earnings, the amount of available Foreign Tax Credits and our ability to utilize certain Foreign Tax Credits Deferred tax assets and liabilities reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred tax assets and liabilities are as follows (in thousands): December 31, 2018 December 31, 2017 Deferred tax assets: Foreign tax credits carryforwards $ 4,788 $ 4,731 Net operating loss carryforwards - Foreign 5,531 5,596 Net operating loss carryforwards - State 887 914 Research & development credits 303 303 AMT credit 770 770 Stock compensation 559 570 Depreciable assets 38 33 Accrued liabilities and reserves 67 66 Total deferred tax assets 12,943 12,983 Deferred tax liabilities: Intangibles (697) (1,045) Accrued liabilities and reserves (174) (120) Total deferred tax liability (871) (1,165) Net deferred tax assets, before valuation allowance 12,072 11,818 Valuation allowance (10,932) (11,544) Net deferred tax asset $ 1,140 $ 274 In conjunction with the acquisition of Evolving Systems Labs in October 2013, we recorded certain identifiable intangible assets. We established a deferred tax asset of $0.1 million at the acquisition date for the expected difference between what would be expensed for financial reporting purposes and what would be deductible for income tax purposes. In September 2015, we established a deferred tax liability of $1.8 million as a result of the acquisition of Evolving Systems NC. In September 2017, we established a deferred tax liability of $0.4 million as a result of the acquisition of the Lumata Entities. As of December 31, 2018, and 2017, there was a net deferred tax liability of $0.7 million and a net deferred tax liability of $0.8 million, respectively. This net deferred tax liability will be recognized as the identifiable intangibles are amortized. We maintain a valuation allowance on the domestic net deferred tax assets other than $0.7 million in AMT credits and $0.5 million in FTC, and $0.3 million of foreign net deferred tax assets, as we have determined it is more likely than not that we will not realize our domestic deferred tax assets. Such assets primarily consist of certain net state operating loss carryforwards, research and development credits and, Foreign Tax Credits. We assessed the realizability of our domestic deferred tax assets using all available evidence. In particular, we considered both historical results and projections of profitability for the reasonably foreseeable future periods. We are required to reassess our conclusions regarding the realization of our deferred tax assets at each financial reporting date. A future evaluation could result in a conclusion that all or a portion of the valuation allowance is no longer necessary which could have a material impact on our results of operations and financial position. The benefit for income taxes differs from the amount computed by applying the U.S. federal and state combined income tax rate of 25.6% for 2018 and 38.0% for 2017 to (loss) income to (loss) income before income tax (benefit) expense as follows (in thousands): For the Years Ended December 31, 2018 2017 U.S. federal income tax expense at statutory rates $ (3,920) $ 1,776 State income tax expense, net of federal impact 23 22 Foreign Tax Credit - (848) Foreign rate differential 540 (1,312) Foreign deemed dividends - 1,311 Change in valuation allowance (274) 844 Research and development expenses (1,167) (305) Foreign taxes - 18 Section 78 Gross-up - 311 US Tax Reform - (108) Goodwill impairment loss 4,188 - Permanent differences and other, net 184 (288) Total tax (benefit) expense $ (426) $ 1,421 The Company recognizes the tax benefit from an uncertain tax position when it determines that it is more likely than not that the position would be sustained upon examination by taxing authorities. As of December 31, 2018, and 2017, we had no liability for unrecognized tax benefits. We do not believe there will be any material changes to our unrecognized tax positions over the next twelve months. Interest and penalties related to income tax liabilities are included as a component of income tax expense (benefit) in the accompanying statements of operations. Our income taxes payable may be reduced by the AMT tax benefits from employee stock plan awards. We had no net excess tax benefits from employee stock plan awards for the years ended December 31, 2018 and 2017, which would be reflected as income tax expense or benefit in the statement of operations. 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. In the normal course of business, we are subject to examination by taxing authorities throughout the world, namely the U.K., France, and India. Although carryovers can always be subject to review by taxing authorities, we are no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations for years before 2013. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2018 | |
Stockholders' Equity [Abstract] | |
Stockholders' Equity | NOTE 7 − STOCKHOLDERS’ EQUITY Common Stock Dividends There were no accrued dividends as of December 31, 2018 and 2017, respectively. Any determination to declare a future quarterly dividend, as well as the amount of any cash dividend which may be declared, will be based on our financial position, earnings, earnings outlook and other relevant factors at that time, including applicable limits under our term loan facility or any other credit facility then in effect. Treasury Stock As of December 31, 2018, and 2017, we hold 178,669 , respectively shares of our common stock that we purchased prior to the expiration of our stock purchase program on December 31, 2014. 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 December 31, 2018, and 2017, 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. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2018 | |
Share-Based Compensation [Abstract] | |
Share-Based Compensation | NOTE 8 — 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 recognized $0.7 million for the years ended December 31, 2018 and 2017, respectively, of compensation expense in the consolidated statements of operations, with respect to our stock-based compensation plans. The following table summarizes stock-based compensation expenses recorded in the statement of operations (in thousands): For the Years Ended December 31, 2018 2017 Cost of revenue, excluding depreciation and amortization $ 52 $ 26 Sales and marketing 39 28 General and administrative 590 611 Product development 21 77 Total share-based compensation $ 702 $ 742 Stock Option/Incentive Plans In June 2007, our stockholders approved the 2007 Stock Incentive Plan (the “2007 Stock Plan”) with a maximum of 1.0 million 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 1.25 million. 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 1.5 million. 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 2.0 million. 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 one year for directors and, with respect to stock option grants, expire no more than ten years from the date of grant. At December 31, 2018 and 2017, there were no shares available for grant under the 2007 Stock Plan. At December 31, 2018 and 2017, 0.5 million and 0. 7 million options and restricted shares were issued and outstanding under the 2007 Stock Plan, respectively. In June 2016, our stockholders approved the 2016 Stock Incentive Plan (the “2016 Stock Plan”) with a maximum of 0.25 million shares reserved for issuance. In June 2018, our stockholders approved an amendment to the 2016 Stock Plan which increased the maximum shares that may be awarded under the plan to 0.85 million 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 December 31, 2018 and December 31, 2017, 0.4 million and 0.6 million options and restricted shares were issued and outstanding under the 2016 Stock Plan, respectively. At December 31, 2018 and December 31, 2017, there were approximately 0.4 million and 0.1 million shares available for grant under the 2016 Stock Plan, respectively. Restricted Stock Number of Shares (in thousands) Unvested restricted stock at December 31, 2016 15 Add restricted stock granted 622 Less restricted stock vested (5) Less restricted stock forfeited/expired (35) Unvested restricted stock at December 31, 2017 597 Less restricted stock vested (181) Less restricted stock forfeited/expired (67) Unvested restricted stock at December 31, 2018 349 During the year ended December 31, 2017 we awarded a total of 0.6 million shares of restricted stock to members of our senior management. During the years ended December 31, 2018 and 2017, approximately 0.18 million and 0.01 million shares of restricted stock vested, respectively. There were forfeitures of approximately 0.07 million shares of restricted stock during the year ended December 31, 2018. There were forfeitures of approximately 0.03 million shares of restricted stock during year ended December 31, 2017. The fair market value of restricted shares for stock-based compensation expense is equal to the closing price of our common stock on the date of grant. The restrictions on the stock award are released generally over four years for senior management and over one year for board members. Stock-based compensation expense includes $0.5 million and $0.6 million for the years ended December 31, 2018 and 2017, respectively for restricted stock. The shares of restricted stock granted to our Board of Directors and senior management team in 2017 include 0.2 million shares subject to achievement of annual performance goals established by our Board of Directors. The restricted shares vest over four years. Of the restrictions on the stock awards granted during the periods 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 third quarter of 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. Of the restrictions on the stock awards granted during the fourth quarter of 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. Of the restrictions on the stock awards granted during the period ended December 31, 2017, one-fourth was released on the one-year anniversary of the date of the grant and the balance is being released quarterly over a three-year period. For the year ended December 31, 2018, we did not attain the annual performance goals. Vested shares are included in the number of Common Stock outstanding shares referenced on the cover of this Annual Report on Form 10-K and referenced in the table above for the year ended December 31, 2018. The weighted-average assumptions used in the fair value calculations of the stock options are as follows: For the Years Ended December 31, 2018 2017 Expected term (years) 6.0 6.4 Risk-free interest rate 2.9 % 2.15 % Expected volatility 38.43 % 38.86 % Expected dividend yield 0.0 % 0.0 % The following is a summary of stock option activity under the stock option plans for the years ended December 31, 2018 and 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 Less options forfeited/cancelled (233) 5.50 Less options exercised (108) 2.46 Add options granted 370 4.53 Options outstanding at December 31, 2017 713 $ 5.71 8.23 $ 128 Less options forfeited/cancelled (142) 5.20 Less options exercised (10) 0.40 Add options granted 30 2.25 Options outstanding at December 31, 2018 591 $ 5.75 7.39 $ - Options exercisable at December 31, 2018 368 $ 6.51 6.67 $ - The following is a summary of stock options outstanding under the plans as of December 31, 2018: Stock Options Outstanding Stock Options Exercisable Weighted Avg. Remaining Range of Number of Shares Contractual Life Weighted Avg. Number of Shares Weighted Avg. Exercise Prices (in thousands) (years) Exercise Price (in thousands) Exercise Price $ 0.01 $ 4.46 40,608 7.82 $ 2.65 10,608 $ 3.78 $ 4.47 $ 4.55 171,875 8.84 $ 4.50 59,375 $ 4.50 $ 4.56 $ 5.90 91,175 7.97 $ 5.00 45,532 $ 5.27 $ 5.91 $ 6.23 179,500 6.75 $ 6.00 145,843 $ 6.00 $ 6.24 $ 10.90 107,851 5.49 $ 9.13 106,570 $ 9.13 The weighted-average grant-date fair value of stock options granted during the years ended December 31, 2018 and 2017 was $1.84 and $ 1.8 7 , respectively. As of December 31, 2018, there were approximately $1.0 million of total time-based unrecognized compensation costs related to unvested stock options and restricted stock. These costs are expected to be recognized over a weighted average period of 2.3 years. The total intrinsic value of stock option exercises for the years ended December 31, 2018 and 2017 was $0.1 . The total fair value of stock awards vested during the years ended December 31, 2018 and 2017 was $0.2 million. The deferred income tax benefits from stock options expense related to Evolving Systems U.K. totaled less than $0.1 million for the years ended December 31, 2018 and 2017, respectively. Cash received from stock option exercises was less than $0.1 million for the years ended December 31, 2018 and 2017, respectively. There were no net settlement exercises during the year ended December 31, 2018. Net settlement exercises during the year ended December 31, 2017, resulted in approximately 0.02 million shares issued and 0.08 million options cancelled in settlement of shares issued, respectively. Employee Stock Purchase Plan Under the Employee Stock Purchase Plan (“ESPP”), we are authorized to issue up to 0.55 million shares of our common stock to full-time employees, nearly all of whom are eligible to participate. Under the terms of the ESPP, employees may elect to have up to 15 % of their gross compensation withheld through payroll deduction to purchase our common stock, capped at $ 25,000 annually and no more than 0.01 million 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 December 31, 2018, there were approximately 0.05 million shares available for purchase. For the years ended December 31, 2018 and 2017, we recorded compensation expense of $0.0 million 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. Cash received from employee stock plan purchases was a de minimis amount for the years ended December 31, 2018 and 2017, respectively. We issued a de minimis number of shares related to the ESPP for the years ended December 31, 2018 and 2017, respectively. |
Benefit Plans
Benefit Plans | 12 Months Ended |
Dec. 31, 2018 | |
Benefit Plans [Abstract] | |
Benefit Plans | NOTE 9 — BENEFIT PLANS We have established a defined contribution retirement plan for our employees under section 401(k) of the Internal Revenue Code (the “401(k) Plan”) that is available to all U.S. employees 21 years of age or older with a month of service. Beginning in 2012, we adopted a Safe Harbor 401(k) requiring us to contribute 3 % of the employee's compensation for each eligible employee, regardless of whether the employee chooses to participate in the plan. All employee contributions are fully vested immediately and employer contributions vest over a period of three years. Evolving Systems U.K. has established a defined contribution pension scheme that is available to all employees in their first full month of employment. Employees may contribute a percentage of their earnings, the amount of which is dependent upon the age of the employee, not to exceed the maximum statutory contribution amount. We match 5 % of employee contributions. All contributions are immediately vested in their entirety. During 2018 and 2017, we recorded a consolidated expense of $0.4 million and $ 0.2 million, under the aforementioned plans, respectively. |
(Loss) Earnings Per Share
(Loss) Earnings Per Share | 12 Months Ended |
Dec. 31, 2018 | |
(Loss) Earnings Per Share [Abstract] | |
(Loss) Earnings Per Share | NOTE 10 — (LOSS) EARNINGS PER SHARE Basic (loss) earnings per share is computed by dividing net (loss) or income available to common stockholders by the weighted average number of shares of common stock outstanding during the period, including common stock issuable under participating securities. Diluted earnings per share is computed using the weighted average number of shares of common stock outstanding, plus all potentially dilutive common stock equivalents using the treasury stock method. Common stock equivalents consist of stock options and restricted stock. The following is the reconciliation of the numerators and denominators of the basic and diluted earnings per share computations (in thousands except per share data): For the Years Ended December 31, 2018 2017 Basic (loss) income per common share: Net (loss) income $ (14,787) $ 2,516 Basic weighted average shares outstanding 12,108 11,934 Basic (loss) income per common share: $ (1.22) $ 0.21 Diluted (loss) income per common share: Net (loss) income $ (14,787) $ 2,516 Weighted average shares outstanding 12,108 11,934 Effect of dilutive securities - options and restricted stock - 47 Diluted weighted average shares outstanding 12,108 11,981 Diluted (loss) income per common share: $ (1.22) $ 0.21 Weighted average options to purchase approximately 0.6 million shares, and 0.4 million shares of common stock equivalents were excluded from the computation of diluted weighted average shares outstanding for the years ended December 31, 2018, and 2017, respectively, because the effect would have been anti-dilutive since their exercise prices were greater than the average market value of our common stock for the period. |
Commitments And Contingencies
Commitments And Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | NOTE 11 — COMMITMENTS AND CONTINGENCIES (a) Lease Commitments We lease office and operating facilities under non-cancelable operating leases. Current facility leases include our offices in Englewood, Colorado, New York, New York, Durham, North Carolina, London, England Bangalore, Kolkata and Delhi India, Johannesburg, South Africa, Kuala Lumpur, Malaysia, Mexico City, Mexico, Grenoble, France, Cluj-Napoca, Romania and Madrid, Spain. Rent expense was $0.7 million and $0.6 million for the years ended December 31, 2018 and 2017, respectively. There was no sublease rental income for the years ended December 31, 2018 and 2017. Our former headquarters office facility lease in Englewood, Colorado terminated on November 30, 2017 at the end of the lease term. Any leasehold improvements had been fully amortized, and equipment disposed of related to the office closure was fully depreciated. We entered into a monthly lease for new office facilities in Englewood Colorado. We account for the effect of any free rent or escalating lease payments as if the lease rate were consistent over the lease term. Future minimum commitments under non-cancelable operating leases gross of sublease payments as of December 31, 2018 are as follows (in thousands): Payments due by period Total 2019 2020 2021 2022 Thereafter Operating Leases $ 1,470 $ 509 $ 357 $ 253 $ 252 $ 99 Total Commitments $ 1,470 $ 509 $ 357 $ 253 $ 252 $ 99 (b) 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, we did not record any liabilities for these agreements as of December 31, 2018 and 2017. 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. We did not record any liabilities for these agreements as of December 31, 2018 and 2017. 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, we did not record any liabilities for these product warranty provisions as of December 31, 2018 and 2017. 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, we did not record any liabilities for these indemnification provisions as of December 31, 2018 and 2017. When we acquired Telespree on October 24, 2013 , we agreed to make a final cash payment on October 24, 2014 of $0.5 million. This payment was subject to reduction for certain claims and we notified the seller’s representative that we were asserting claims against the final cash payment prior to October 24, 2014. The contractually agreed time period for mandatory arbitration, as well as the applicable Delaware state law, has lapsed. Accordingly, we eliminated the liability as of June 30, 2018 and recognized $0.5 million gain in other income for the fiscal year ending December 31, 2018. (c) Litigation In June 2018, we agreed to a Mutual Release and Settlement Agreement and a Contribution Agreement (the “SSM Agreements”) with certain parties related to our September 30, 2015 acquisition of SSM. The SSM Agreements settled a dispute with a former SSM contractor, for which the Company asserted indemnification from the SSM sellers. Under the SSM Agreements, in July 2018 we paid $0.3 million toward the settlement, $0.1 million of which was on the Company’s behalf and recorded as other expense for the fiscal year ending December 31, 2018. The Company and the SSM sellers agreed to offset the Company’s contribution to the settlement against the final payment due to the SSM sellers and, therefore, we were released from a $0.3 million final payment due to the sellers of SSM. 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. |
Geographical Information
Geographical Information | 12 Months Ended |
Dec. 31, 2018 | |
Geographical Information [Abstract] | |
Geographical Information | NOTE 12 — GEOGRAPHICAL INFORMATION We are headquartered in Englewood, a suburb of Denver, Colorado. We use customer locations as the basis for attributing revenue to individual countries. We provide products and services on a global basis through our offices in Colorado, North Carolina and our U.K.-based Evolving Systems U.K. subsidiary. Additionally, personnel in Bangalore and Kolkata, India, provide software development services and support to our global operations. Financial information relating to operations by geographic region exceeding the threshold (defined as contributing at least 10%) of revenue from operations is as follows (in thousands): December 31, 2018 December 31, 2017 Long-lived assets, net United States $ 2,741 $ 11,276 United Kingdom 7,098 17,968 Other 1,752 1,843 $ 11,591 $ 31,087 |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 2018 | |
Restructuring [Abstract] | |
Restructuring | NOTE 13 — RESTRUCTURING There were no restructuring charges during the fiscal year ending December 31, 2018. During the second half of 2017, we undertook a reduction in workforce involving the termination of employees resulting in an expense of $0.3 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. There was no restructuring liability as of December 31, 2018 and 2017, respectively. |
Organization And Summary Of S_2
Organization And Summary Of Significant Accounting Policies (Policy) | 12 Months Ended |
Dec. 31, 2018 | |
Organization And Summary Of Significant Accounting Policies [Abstract] | |
Organization | Organization — Evolving Systems, Inc. (the “Company”) is a provider of real-time digital engagement solutions and services of software solutions and services to the wireless carrier and consumer financial services markets. We maintain long-standing relationships with many of the largest wireless companies worldwide. The Company’s portfolio includes market-leading solutions and services for real-time analytics, customer acquisition and activation, customer value management and loyalty for the telecom industry promoting partnerships into retail and financial services. 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 capital expenditure license and services to operating expenditure models based on recurring managed services with performance fees. Our software solution platforms enable carriers’ marketing departments to innovate, execute and manage highly-personalized and contextually-relevant, interactive campaigns that engage consumers in real-time, and enhance customer retention through deploying loyalty programs. 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”). In July 2017 we completed the acquisition of Business Logic Systems (“BLS”). BLS, headquartered in Newbury, United Kingdom, 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. In September 2017 we completed 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. We believe the acquisitions of BLS and the Lumata Entities further reinforced 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 more than 100 customers spanning 65 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. 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. |
Business Combinations | Business Combinations – I n July 2017 and September 2017 we acquired Business Logic Systems which became BLS Limited (“EVOL BLS”) and the four business operating units of Lumata Holdings Ltd. These business combinations are reflected in these consolidated financial statements since the acquisition date. Refer to Note 2, Acquisitions, for more information regarding the acquisitions. We account for business combinations in accordance with the acquisition method. The acquisition method of accounting requires that assets acquired, and liabilities assumed be recorded at their fair values on the date of a business acquisition. The excess of the purchase price over the fair value of assets acquired is recognized as goodwill. Certain adjustments to the assessed fair values of the assets and liabilities made subsequent to the acquisition date, but within the measurement period, which is up to one year, are recorded as adjustments to goodwill. Any adjustments subsequent to the measurement period are recorded in income. Our consolidated financial statements and results of operations reflect an acquired business from the completion date of an acquisition. The judgments that we make in determining the estimated fair value assigned to each class of assets acquired and liabilities assumed, as well as asset lives, can materially impact net income in periods following a business combination. We generally use either the income, cost or market approach to aid in our conclusions of such fair values and asset lives. The income approach presumes that the value of an asset can be estimated by the net economic benefit to be received over the life of the asset, discounted to present value. The cost approach presumes that an investor would pay no more for an asset than its replacement or reproduction cost. The market approach estimates value based on what other participants in the market have paid for reasonably similar assets. Although each valuation approach is considered in valuing the assets acquired, the approach ultimately selected is based on the characteristics of the asset and the availability of information. |
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 progress toward completion and direct profit or loss on contracts, 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, generally, 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 income (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 (loss) in the period in which they occur. |
Principles Of Consolidation | Principles of Consolidation — The 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. |
Reclassifications | Reclassification — Certain reclassifications have been made to conform the 2017 amounts to the 2018 classifications for comparative purposes. |
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 an other than temporary decline in our market capitalization that is calculated as our common stock’s market price multiplied by the number of shares of common stock outstanding, 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. In 2018, the Company adopted ASU 2017-04, Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment, which simplifies the subsequent measurement of goodwill by eliminating the second step from the quantitative goodwill impairment test. Under this guidance, annual or interim goodwill impairment testing will be performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge will then be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value, not to exceed the carrying value of goodwill. |
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., EVOL BLS and the Lumata Entities. These assets are amortized using the straight-line method over their estimated lives. We assess 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 — Effective January 1, 2018, we adopted Financial Accounting Standards Board (“FASB”) Topic 606, Revenue from Contacts with Customers (“ASC 606”). ASC 606 was applied using the modified retrospective method. Accordingly, comparative periods have not been adjusted and continue to be reported under FASB ASC Topic 605, Revenue Recognition (“ASC 605”). There was no cumulative effect of the initial application to be recognized as an adjustment to opening retained earnings at January 1, 2018 as the adoption did not have a material impact on the Company’s results of operations or financial condition. The majority of our license fees and services revenue is generated from fixed-price contracts, this provides for licenses to our software products and services that customize such software to meet our customers’ needs. In most instances, customization services are determined to be essential to the functionality of the delivered software. Under ASC 606, revenue is recognized when our customer obtains control of promised goods or services in an amount that reflects the consideration we expect to receive in exchange for those goods or services. We measure revenue based on consideration specified in a contract with a customer and exclude any sales incentives. Furthermore, we recognize revenue when we satisfy a performance obligation by transferring control over the service to our customer. A performance obligation is a promise in a contract to transfer a distinct service to the customer. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as the customer receives the benefit of the performance obligation. Our customers typically receive the benefit of our services as they are performed. Substantially all customer contracts provide that we are compensated for services performed to date. Losses on fixed-price projects are recorded when identified. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by us from a customer, are excluded from revenue. Nature of goods and services The following is a description of our products and services from which we generate revenue, as well as the nature, timing of satisfaction of performance obligations, and significant payment terms for each: i. License Revenue License fees represent the fees we receive from the licensing of our software products. In most instances, customization services are determined to be essential to the functionality of the delivered software. The license along with the customization services are transferred to our customers over time. In arrangements where the services are not essential to the functionality of the delivered software, we recognize license revenue when the license agreement has been approved and the software has been delivered. We can identify each party’s rights, payment terms, and commercial substance of the content. Where applicable, we identify multiple performance obligations and record as revenue as the performance obligations are fulfilled based on their estimated allocated value. The selection of the method to measure progress towards completion requires judgment and is based on the extent of progress towards completion of the performance obligation. ii. Customer Support Revenue Customer support services includes annual support fees, recurring maintenance fees, warranty support fees and minor product upgrades. The warranty support fees represent a separate performance obligation that is provided for up to a year with initial license purchase. The Company allocates the contract transaction price related to warranty support fees based on pricing consistent with what we would offer to other market participants. Upon the conclusion of the warranty period, the customer can choose to continue to receive support and maintenance services via our customer support offerings. We recognize revenue from our support ratably over the service contract period. iii. Services Revenue We recognize revenue from fixed-price service contracts using the input method of accounting. Under the input method, revenue is recognized revenue on the basis of an entity’s efforts or inputs toward satisfying a performance obligation. 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 performance obligation to our customers under such arrangements is fulfilled. iv. Managed Services We recognize revenue from our managed services contracts primarily 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 input method of accounting, as previously described. Disaggregation of revenue In the following table, revenue is disaggregated by primary geographical market, major products/service lines, and timing of revenue recognition (in thousands): For the Years Ended December 31, 2018 2017 Primary geographical markets United Kingdom $ 6,222 $ 5,521 Other 24,414 23,291 $ 30,636 $ 28,812 Major products/service lines Licensing fees $ 1,433 $ 3,438 Customer support, including warranty support fees 9,984 9,134 Services 8,880 8,711 Managed services 10,339 7,529 Total services 29,203 25,374 $ 30,636 $ 28,812 Timing of revenue recognition Products transferred at a point in time $ 882 $ 914 Products and services transferred over time 29,754 27,898 $ 30,636 $ 28,812 Contract balances The following table provides information about receivables, assets, and liabilities from contracts with customers (in thousands): December 31, 2018 December 31, 2017 Assets Contract receivables, net $ 7,757 $ 10,151 Unbilled work-in-progress, net $ 3,044 $ 5,823 Liabilities Unearned revenue $ 3,911 $ 5,397 Contract receivables are recorded at the invoiced amount and do not bear interest. Credit is extended based on the evaluation of a customer’s financial condition and collateral is not required. Unbilled work-in-progress is revenue which has been earned but not invoiced. The contract assets are transferred to the receivables when invoiced. The contract liabilities primarily relate to unearned revenue. Amounts billed in advance of performance obligations being satisfied are booked as unearned revenue. Transaction price allocated to the remaining performance obligations Remaining performance obligations represent the transaction price of firm orders for which work has not been performed as of the period end date and excludes unexercised contract options and potential orders under ordering-type contracts (e.g., indefinite-delivery, indefinite-quantity). As of December 31, 2018, the aggregate amount of the transaction price allocated to remaining performance obligations with lives greater than one-year totals $1.5 million. The Company expects approximately 80% of remaining performance obligations to be recognized into revenue within the next twelve months, with the remaining 20% recognized thereafter. We apply the practical expedient in paragraph ASC 606-10-50-14 and do not disclose information about remaining performance obligations that have original expected durations of one-year or less. We apply the transition practical expedient in paragraph ASC 606-10-65-1(f)(3) and do not disclose the amount of the transaction price allocated to the remaining performance obligations and an explanation of when we expect to recognize that amount as revenue. Additionally, applying the practical expedient in paragraph ASC 340-40-25-4, the Company recognizes the incremental costs of obtaining contracts (i.e., commissions) as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one-year or less. |
Allowance For Doubtful Accounts | Allowance for Doubtful Accounts — We make judgments related to our ability to collect outstanding accounts receivable and unbilled work-in-progress. We provide allowances for receivables when their collection becomes doubtful by recording an expense. We determine the allowance based on our assessment of the realization of receivables using historical information and current economic trends, including assessing the probability of collection from customers. If the financial condition of our customers were to deteriorate, resulting in an impairment of their ability to make payments owed to us, an increase in the allowance for doubtful accounts would be required. We evaluate the adequacy of the allowance regularly and make adjustments accordingly. Adjustments to the allowance for doubtful accounts could materially affect our results of operations. The following table reflects the activity in the allowance for doubtful accounts: Balance at Bad Debt Write-Offs Charged Effects of Foreign Currency Balance at Fiscal Beginning Expense/ to Exchange End of Year Description of Period (Recovery) Allowance Rates Period 2018 Allowance for doubtful accounts $ 970 $ (86) $ (124) $ 11 $ 771 2017 Allowance for doubtful accounts $ 221 $ 789 $ (41 ) $ 1 $ 970 The following table reflects the activity in the allowance for unbilled work-in-progress: Balance at Unbilled Work-in- Progress Write-Offs Charged Effects of Foreign Currency Balance at Fiscal Beginning Allowance/ to Exchange End of Year Description of Period (Recovery) Allowance Rates Period 2018 Allowance for unbilled work-in-progress $ 107 $ 454 $ 2 $ (11) $ 552 2017 Allowance for unbilled work-in-progress $ — $ 107 $ — $ — $ 107 |
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. In March 2016, the FASB issued ASU 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. Stock-based payments made to non-employees, including grants of stock options, are recognized in the statements of operations based on their estimated fair values. The fair value of these options will be re-measured on each reporting date until the options vest. The re-measured fair value will be recognized as compensation expense over the remaining vesting term of the options. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) — Comprehensive income consists of two components, net income and other comprehensive income (loss). Other comprehensive income 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. |
Concentration Of Credit Risk | Concentration of Credit Risk — Financial instruments that potentially subject us to concentrations of credit risk consist primarily of contract receivables and unbilled work-in-progress. We perform on-going evaluations of customers’ financial condition and, generally, require no collateral from customers. A substantial portion of our revenue is from a limited number of customers, all in the telecommunications industry. For the year ended December 31, 2018, one significant customer accounted for 11% of revenue from operations. This customer is a large telecommunications operator in Europe. For the year ended December 31, 2017, one significant customer accounted for 11% of revenue from operations. This customer is a large telecommunications operator in Europe. As of December 31, 2018, and 2017 no customers accounted for 10% of contract receivables and unbilled work-in-progress. We are subject to concentration of credit risk with respect to our cash and cash equivalents, which we attempt to minimize by maintaining our cash and cash equivalents with institutions of sound financial quality. At times, cash balances may exceed limits federally insured by the Federal Deposit Insurance Corporation (“FDIC”). Our cash and cash equivalents are not under any FDIC program were $ 6.5 million and $5.4 million as of December 31, 2018 and 2017, respectively. |
Sales, Use And Other Value Added Tax | Sales, Use and Other Value Added Tax — Applicable revenue-based state, use and other value added taxes are included in revenue. |
Advertising And Promotion Costs | Advertising and Promotion Costs — Advertising and promotion costs are expensed as incurred. Advertising costs totaled approximately $0.2 million and $0.1 million for the years ended December 31, 2018 and 2017, respectively. |
Capitalization Of Internal Software Development Costs | Capitalization of Internal Software Development Costs — We expend amounts on product development, particularly for new products and/or for enhancements of existing products. For internal development of software products that are to be licensed by us, we expense the cost of developing software prior to establishing technological feasibility and those costs are capitalized once technological feasibility has been established. Capitalization ceases upon general release of the software. The determination of whether internal software development costs are subject to capitalization is, by its nature, highly subjective and involves significant judgments. This decision could significantly affect earnings during the development period. Further, once capitalized, the software costs are generally amortized on a straight-line basis over the estimated economic life of the product. The determination of the expected useful life of a product is highly judgmental. Finally, capitalized software costs must be assessed for impairment if facts and circumstances warrant such a review. We did no t capitalize any internal software development costs during the two years ended December 31, 2018. In addition, we did not have any capitalized internal software development costs included in our December 31, 2018 and 2017 Consolidated Balance Sheets. We believe that during these periods no material internal software development costs were required to be capitalized. Our conclusion is primarily based on the fact that the feature−rich, pre−integrated, and highly−scalable nature of our products requires that our development efforts include complex design, coding and testing methodologies, which include next generation software languages and development tools. Development projects of this nature carry a high degree of development risk. Substantially all of our internal software development efforts are of this nature, and therefore, we believe the period between achieving technological feasibility and the general release of the software to operations is so short that any costs incurred during this period are not material. |
Property And Equipment And Long-Lived Assets | Property and Equipment and Long-Lived Assets — Property and equipment are stated at cost or estimated fair value if acquired in an acquisition, less accumulated depreciation, and are depreciated over their estimated useful lives, or the lease term, if shorter, using the straight-line method. Leasehold improvements are stated at cost, less accumulated amortization, and are amortized over the shorter of the lease term or estimated useful life of the asset. Maintenance and repair costs are expensed as incurred. We review our long-lived assets, such as property and equipment and purchased intangible assets subject to amortization, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. We evaluate the recoverability of an asset or asset group by comparing its carrying amount to the estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset or asset group exceeds its estimated future cash flows, we recognize an impairment charge as the amount by which the carrying amount of the asset exceeds the estimated fair value of the asset. |
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 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 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. |
Recently Adopted Accounting Pronouncements And Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements — In May 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers, Topic 606 and various updates to the ASU thereafter. We adopted the new standard effective January 1, 2018, using the modified retrospective transition method. Accordingly, comparative periods have not been adjusted and continue to be reported under FASB ASC Topic 605, Revenue Recognition (“ASC 605”). There was no cumulative effect of the initial application to be recognized as an adjustment to opening retained earnings at January 1, 2018 as the adoption did not have a material impact on the Company’s results of operations or financial condition. In November 2016, the FASB issued ASU 2016-18, Restricted Cash (Topic 230): Statement of Cash Flows (“ASU 2016-18”). ASU 2016-18 requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. Restricted cash and restricted cash equivalents will be included with cash and cash equivalents when reconciling the beginning of period and end of period balances on the statement of cash flows upon adoption of this standard. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment, which eliminates the second step of the two-step quantitative approach for testing goodwill for potential impairment. An entity will therefore perform the goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the fair value, not to exceed the total amount of goodwill allocated to the reporting unit. An entity still has the option to perform a qualitative assessment to determine if the quantitative impairment test is necessary. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019 on a prospective basis, with early adoption permitted. The provisions of ASU 2017-04 were adopted during the fourth quarter of 2018, see Note 3 for the impact on our consolidated financial statements. Recent Accounting Pronouncements — In February 2016, the FASB established Topic 842, Leases, by issuing ASU 2016-02, which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU 2018-10, Codification Improvements to Topic 842, Leases; and ASU 2018-11, Targeted Improvements. The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The new standard is effective for us on January 1, 2019. We expect to adopt the new standard on its effective date. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. If an entity chooses the second option, the transition requirements for existing leases also apply to leases entered into between the date of initial application and the effective date. The entity must also recast its comparative period financial statements and provide the disclosures required by the new standard for the comparative periods. We expect to adopt the new standard on January 1, 2019 and use the effective date as our date of initial application. Consequently, financial information will not be updated, and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2019. The new standard provides several optional practical expedients in transition. We expect to elect the ‘package of practical expedients’, which permits us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. We do not expect to elect the use-of hindsight or the practical expedient pertaining to land easements; the latter not being applicable to us. We expect to elect all the new standard’s available transition practical expedients. We expect that this standard will have a material effect on our financial statements. While we continue to assess all of the effects of adoption, we currently believe the most significant effect relates to the recognition of new ROU assets and lease liabilities on our balance sheet for our real estate operating leases and providing significant new disclosures about our leasing activities. We do not expect a significant change in our leasing activities between now and adoption. On adoption, we currently expect to recognize additional operating liabilities of approximately $1.6 million with corresponding ROU assets of the same amount based on the present value of the remaining minimum rental payments under current leasing standards for existing operating leases. The new standard also provides practical expedients for an entity’s ongoing accounting. We currently expect to elect the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, we will not recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. We also currently expect to elect the practical expedient to not separate lease and non-lease components for all our leases. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326) – Measurement of Credit Losses on Financial Instruments (ASU 2016-13). ASU 2016-13 requires entities to establish an allowance for credit losses for most financial assets. Prior GAAP was based on an incurred loss methodology for recognizing credit losses on financial assets measured at amortized cost and available-for sale debt securities. The update is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 31, 2018. We have not yet assessed the impact on our consolidated financial statements or related disclosures. In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220) - Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. The amendments in this ASU allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Act. Consequently, the amendments eliminate the stranded tax effects resulting from the Act and will improve the usefulness of information reported to financial statement users. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018. Early adoption is permitted in any period after issuance of the ASU. We do not expect the amendments in this ASU to have a material impact on our consolidated financial statements. In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718) - Improvements to Nonemployee Share-Based Payment Accounting. ASU 2018-07 is intended to reduce cost and complexity and to improve financial reporting for share-based payments issued to nonemployees. This ASU expands the scope of ASC Topic 718, Compensation - Stock Compensation, which currently only includes share-based payments issued to employees, to also include share-based payments issued to nonemployees for goods and services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. ASU 2018-07 supersedes ASC Subtopic 505-50, Equity - Equity-Based Payments to Non-Employees. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018. We do not expect this ASU will have a material impact on our consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (ASC 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement . ASU 2018-13 removes certain disclosures, modifies certain disclosures and adds additional disclosures. ASU 2018-13 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted. We have not yet assessed the impact on our consolidated financial statements or related disclosures. Management has evaluated other recently issued accounting pronouncements and does not believe that any of these pronouncements will have a significant impact on our consolidated financial statements and related disclosures. |
Organization And Summary Of S_3
Organization And Summary Of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Organization And Summary Of Significant Accounting Policies [Abstract] | |
Schedule Of Disaggregation Of Revenue | For the Years Ended December 31, 2018 2017 Primary geographical markets United Kingdom $ 6,222 $ 5,521 Other 24,414 23,291 $ 30,636 $ 28,812 Major products/service lines Licensing fees $ 1,433 $ 3,438 Customer support, including warranty support fees 9,984 9,134 Services 8,880 8,711 Managed services 10,339 7,529 Total services 29,203 25,374 $ 30,636 $ 28,812 Timing of revenue recognition Products transferred at a point in time $ 882 $ 914 Products and services transferred over time 29,754 27,898 $ 30,636 $ 28,812 |
Schedule Of Receivables, Assets And Liabilities From Contracts With Customers | December 31, 2018 December 31, 2017 Assets Contract receivables, net $ 7,757 $ 10,151 Unbilled work-in-progress, net $ 3,044 $ 5,823 Liabilities Unearned revenue $ 3,911 $ 5,397 |
Activity In Allowance For Doubtful Accounts | Balance at Bad Debt Write-Offs Charged Effects of Foreign Currency Balance at Fiscal Beginning Expense/ to Exchange End of Year Description of Period (Recovery) Allowance Rates Period 2018 Allowance for doubtful accounts $ 970 $ (86) $ (124) $ 11 $ 771 2017 Allowance for doubtful accounts $ 221 $ 789 $ (41 ) $ 1 $ 970 |
Activity In Allowance For Unbilled Work-In-Progress | Balance at Unbilled Work-in- Progress Write-Offs Charged Effects of Foreign Currency Balance at Fiscal Beginning Allowance/ to Exchange End of Year Description of Period (Recovery) Allowance Rates Period 2018 Allowance for unbilled work-in-progress $ 107 $ 454 $ 2 $ (11) $ 552 2017 Allowance for unbilled work-in-progress $ — $ 107 $ — $ — $ 107 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
EVOL BLS [Member] | |
Summary Of Total Purchase Price | At July 3, 2017 (preliminary) Measurement Period Adjustments At July 3, 2017 (adjusted) Cash Consideration Total Cash Consideration $ 1,553 $ - $ 1,553 Earnout 380 47 427 Total purchase price $ 1,933 $ 47 $ 1,980 |
Schedule Of Assets Acquired And Liabilities Assumed At Acquisition Date | At July 3, 2017 (preliminary) Measurement Period Adjustments At July 3, 2017 (adjusted) Contract receivables $ 1,037 $ - $ 1,037 Unbilled work-in-progress 1,039 - 1,039 Intangible assets 246 18 264 Prepaid and other current assets 437 - 437 Other assets, non-current 55 - 55 Total identifiable assets acquired 2,814 18 2,832 Accounts payable and accrued liabilities 792 - 792 Deferred revenue 338 - 338 Total identifiable liabilities acquired 1,130 - 1,130 Net identifiable assets acquired 1,684 18 1,702 Goodwill 249 29 278 Net assets acquired $ 1,933 $ 47 $ 1,980 |
Intangible Assets Related To Acquisition | Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 98 $ 29 $ 69 4 yrs. Trademarks and tradenames 9 9 - 0 yrs. Non-competition 4 3 1 1 yrs. Customer relationships 149 32 117 6 yrs. $ 260 (1) $ 73 (1) $ 187 4.9 yrs. Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 102 $ 9 $ 93 5 yrs. Trademarks and tradenames 10 7 3 0.5 yrs. Non-competition 4 1 3 1.5 yrs. Customer relationships 139 8 131 7 yrs. $ 255 $ 25 $ 230 5.9 yrs. (1) Includes functional currency adjustment of less than $0.1 million. |
Lumata Entities [Member] | |
Summary Of Total Purchase Price | At September 4, 2017 (preliminary) Measurement Period Adjustments At September 4, 2017 (adjusted) Cash Consideration $ 4,766 $ - $ 4,766 Total purchase price $ 4,766 $ - $ 4,766 |
Schedule Of Assets Acquired And Liabilities Assumed At Acquisition Date | At September 4, 2017 (preliminary) Measurement Period Adjustments At September 4, 2017 (adjusted) Cash and cash equivalents $ 386 $ - $ 386 Contract receivables 1,444 - 1,444 Unbilled work-in-progress 110 (82) 28 Intangible assets 1,935 - 1,935 Prepaid and other current assets 1,539 - 1,539 Other assets, non-current 19 - 19 Total identifiable assets acquired 5,433 (82) 5,351 Accounts payable and accrued liabilities 3,086 - 3,086 Deferred tax liability 329 - 329 Deferred revenue 325 152 477 Total identifiable liabilities acquired 3,740 152 3,892 Net identifiable assets acquired 1,693 (234) 1,459 Goodwill 3,073 234 3,307 Net assets acquired $ 4,766 $ - $ 4,766 |
Intangible Assets Related To Acquisition | Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 661 $ 126 $ 535 6 yrs. Trademarks and tradenames 109 29 80 4 yrs. Non-competition 2 2 - 0.5 yrs. Customer relationships 1,131 116 1,015 12 yrs. $ 1,903 (1) $ 273 (1) $ 1,630 9.4 yrs. Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 700 $ 33 $ 667 7 yrs. Trademarks and tradenames 115 8 107 5 yrs. Non-competition 2 - 2 1.5 yrs. Customer relationships 1,200 31 1,169 13 yrs. $ 2,017 (1) $ 72 (1) $ 1,945 10.4 yrs. (1) Includes functional currency adjustment of $0.1 million. |
EVOL BLS And Lumata Entities [Member] | |
Schedule Of Pro Forma Information | For the year Ended December 31, 2018 2017 Revenue $ 30,636 $ 34,821 Net (loss) income $ (14,787) $ 144 |
Goodwill And Intangible Assets
Goodwill And Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
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 3,322 Effects of changes in foreign currency exchange rates (1) 1,295 Balance at December 31, 2017 $ 25,216 Measurement period adjustments 263 Goodwill impairment loss (17,760) Effects of changes in foreign currency exchange rates (1) (981) Balance at December 31, 2018 $ 6,738 (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 | December 31, 2018 Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 2,877 $ (1,121) $ 1,756 6.7 yrs. Trademarks and tradenames 303 (223) 80 2.7 yrs. Non-competition 39 (38) 1 1.0 yrs. Customer relationships 4,303 (1,590) 2,713 7.7 yrs. $ 7,522 (1) $ (2,972) (2) $ 4,550 5.8 yrs. December 31, 2017 Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 2,921 $ (743) $ 2,178 7.7 yrs. Trademarks and tradenames 310 (189) 121 3.7 yrs. Non-competition 40 (35) 5 2.0 yrs. Customer relationships 4,363 (1,054) 3,309 8.7 yrs. $ 7,634 $ (2,021) $ 5,613 6.8 yrs. (1) 2018 increase in gross amount due to measurement period adjustments relating to the EVOL BLS purchase price allocation. See Note 2 — Acquisitions for additional information. Includes functional currency adjustment of $0.1 million (2) Includes functional currency adjustment of less than $0.1 million. |
Summary Of Expected Future Amortization Expense Related To Identifiable Intangibles | Year ending December 31, 2019 $ 938 2020 937 2021 923 2022 738 2023 360 Thereafter 654 $ 4,550 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Balance Sheet Components [Abstract] | |
Accounts Payable And Accrued Liabilities | December 31, 2018 December 31, 2017 Accounts payable and accrued liabilities: Accounts payable $ 1,276 $ 1,530 Accrued compensation and related expenses 1,863 1,749 Accrued liabilities 1,344 3,399 $4,483 $6,678 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Taxes [Abstract] | |
Pre-Tax Income From Continuing Operations | For the Years Ended December 31, 2018 2017 Domestic $ (17,820) $ (4,168) Foreign 2,607 8,105 Total $ (15,213) $ 3,937 |
Expense (Benefit) From Continuing Operations For Income Taxes | For the Years Ended December 31, 2018 2017 Current: Federal $ 340 $ (108) Foreign 155 1,998 State 25 22 Total Current 520 1,912 Deferred: Federal 41 (444) Foreign (987) (47) Total Deferred (946) (491) Total $ (426) $ 1,421 |
Components Of Deferred Tax Assets And Liabilities | December 31, 2018 December 31, 2017 Deferred tax assets: Foreign tax credits carryforwards $ 4,788 $ 4,731 Net operating loss carryforwards - Foreign 5,531 5,596 Net operating loss carryforwards - State 887 914 Research & development credits 303 303 AMT credit 770 770 Stock compensation 559 570 Depreciable assets 38 33 Accrued liabilities and reserves 67 66 Total deferred tax assets 12,943 12,983 Deferred tax liabilities: Intangibles (697) (1,045) Accrued liabilities and reserves (174) (120) Total deferred tax liability (871) (1,165) Net deferred tax assets, before valuation allowance 12,072 11,818 Valuation allowance (10,932) (11,544) Net deferred tax asset $ 1,140 $ 274 |
Income Tax Expense Reconciliation | For the Years Ended December 31, 2018 2017 U.S. federal income tax expense at statutory rates $ (3,920) $ 1,776 State income tax expense, net of federal impact 23 22 Foreign Tax Credit - (848) Foreign rate differential 540 (1,312) Foreign deemed dividends - 1,311 Change in valuation allowance (274) 844 Research and development expenses (1,167) (305) Foreign taxes - 18 Section 78 Gross-up - 311 US Tax Reform - (108) Goodwill impairment loss 4,188 - Permanent differences and other, net 184 (288) Total tax (benefit) expense $ (426) $ 1,421 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary Of Stock-Based Compensation Expenses | For the Years Ended December 31, 2018 2017 Cost of revenue, excluding depreciation and amortization $ 52 $ 26 Sales and marketing 39 28 General and administrative 590 611 Product development 21 77 Total share-based compensation $ 702 $ 742 |
Summary Of Restricted Stock Activity | Restricted Stock Number of Shares (in thousands) Unvested restricted stock at December 31, 2016 15 Add restricted stock granted 622 Less restricted stock vested (5) Less restricted stock forfeited/expired (35) Unvested restricted stock at December 31, 2017 597 Less restricted stock vested (181) Less restricted stock forfeited/expired (67) Unvested restricted stock at December 31, 2018 349 |
Stock Options [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Assumptions For Weighted Average Fair Value | For the Years Ended December 31, 2018 2017 Expected term (years) 6.0 6.4 Risk-free interest rate 2.9 % 2.15 % Expected volatility 38.43 % 38.86 % Expected dividend yield 0.0 % 0.0 % |
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 Less options forfeited/cancelled (233) 5.50 Less options exercised (108) 2.46 Add options granted 370 4.53 Options outstanding at December 31, 2017 713 $ 5.71 8.23 $ 128 Less options forfeited/cancelled (142) 5.20 Less options exercised (10) 0.40 Add options granted 30 2.25 Options outstanding at December 31, 2018 591 $ 5.75 7.39 $ - Options exercisable at December 31, 2018 368 $ 6.51 6.67 $ - |
Summary Of Stock Option Outstanding By Exercise Price Ranges | Stock Options Outstanding Stock Options Exercisable Weighted Avg. Remaining Range of Number of Shares Contractual Life Weighted Avg. Number of Shares Weighted Avg. Exercise Prices (in thousands) (years) Exercise Price (in thousands) Exercise Price $ 0.01 $ 4.46 40,608 7.82 $ 2.65 10,608 $ 3.78 $ 4.47 $ 4.55 171,875 8.84 $ 4.50 59,375 $ 4.50 $ 4.56 $ 5.90 91,175 7.97 $ 5.00 45,532 $ 5.27 $ 5.91 $ 6.23 179,500 6.75 $ 6.00 145,843 $ 6.00 $ 6.24 $ 10.90 107,851 5.49 $ 9.13 106,570 $ 9.13 |
(Loss) Earnings Per Share (Tabl
(Loss) Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
(Loss) Earnings Per Share [Abstract] | |
Summary Of Basic And Diluted Earnings (Loss) Per Share | For the Years Ended December 31, 2018 2017 Basic (loss) income per common share: Net (loss) income $ (14,787) $ 2,516 Basic weighted average shares outstanding 12,108 11,934 Basic (loss) income per common share: $ (1.22) $ 0.21 Diluted (loss) income per common share: Net (loss) income $ (14,787) $ 2,516 Weighted average shares outstanding 12,108 11,934 Effect of dilutive securities - options and restricted stock - 47 Diluted weighted average shares outstanding 12,108 11,981 Diluted (loss) income per common share: $ (1.22) $ 0.21 |
Commitments And Contingencies (
Commitments And Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments And Contingencies [Abstract] | |
Future Minimum Commitments | Payments due by period Total 2019 2020 2021 2022 Thereafter Operating Leases $ 1,470 $ 509 $ 357 $ 253 $ 252 $ 99 Total Commitments $ 1,470 $ 509 $ 357 $ 253 $ 252 $ 99 |
Geographical Information (Table
Geographical Information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Geographical Information [Abstract] | |
Long-Lived Assets, Net By Geographic Region | December 31, 2018 December 31, 2017 Long-lived assets, net United States $ 2,741 $ 11,276 United Kingdom 7,098 17,968 Other 1,752 1,843 $ 11,591 $ 31,087 |
Organization And Summary Of S_4
Organization And Summary Of Significant Accounting Policies (Narrative) (Details) $ in Millions | Sep. 07, 2017item | Jul. 06, 2017item | Dec. 31, 2018USD ($)customercountry | Dec. 31, 2017USD ($)customer | Jan. 01, 2019USD ($) | Jan. 01, 2018USD ($) | Dec. 31, 2016USD ($) |
Cash and cash equivalents not under any FDIC program | $ 6.5 | $ 5.4 | |||||
Advertising costs | 0.2 | 0.1 | |||||
Capitalized internal software development costs | 0 | $ 0 | $ 0 | ||||
Cumulative effect to retained earnings | $ 0 | ||||||
Remaining performance obligations | $ 1.5 | ||||||
Percentage of remaining performance obligations, next twelve months | 80.00% | ||||||
Percentage of remaining performance obligations, thereafter | 20.00% | ||||||
Subsequent Event [Member] | |||||||
Operating Lease, Liability | $ 1.6 | ||||||
Customer Concentration Risk [Member] | Contract Receivables And Unbilled Work-In-Progress [Member] | |||||||
Number of customers accounting for contract receivables and unbilled work-in-progress | customer | 0 | 0 | |||||
Concentration risk, percentage | 10.00% | 10.00% | |||||
Significant Customer One [Member] | Europe [Member] | Revenue [Member] | |||||||
Number of customers contributing to revenue from operations | customer | 1 | 1 | |||||
Concentration risk, percentage | 11.00% | 11.00% | |||||
EVOL BLS [Member] | |||||||
Years of expertise in customer acquisition, activation and retention | 25 years | ||||||
EVOL BLS [Member] | Minimum [Member] | |||||||
Number of mobile operators | item | 20 | ||||||
Lumata Entities [Member] | |||||||
Number of business operating units acquired | item | 4 | ||||||
EVOL BLS, Lumata Entities, And Evolving Systems NC, Inc. [Member] | |||||||
Number of countries across the world for customer base | country | 65 | ||||||
EVOL BLS, Lumata Entities, And Evolving Systems NC, Inc. [Member] | Minimum [Member] | |||||||
Number of customers | customer | 100 |
Organization And Summary Of S_5
Organization And Summary Of Significant Accounting Policies (Schedule Of Disaggregation Of Revenue) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 30,636 | $ 28,812 |
Products Transferred At A Point In Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 882 | 914 |
Products and Services Transferred Over Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 29,754 | 27,898 |
License Fees [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 1,433 | 3,438 |
Customer Support Including Warranty Support Fees [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 9,984 | 9,134 |
Services [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 8,880 | 8,711 |
Managed Services [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 10,339 | 7,529 |
Services [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 29,203 | 25,374 |
United Kingdom [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 6,222 | 5,521 |
Other [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 24,414 | $ 23,291 |
Organization And Summary Of S_6
Organization And Summary Of Significant Accounting Policies (Schedule Of Receivables, Assets And Liabilities From Contracts With Customers) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||
Contract receivables, net | $ 7,757 | $ 10,151 |
Unbilled work-in-progress, net | 3,044 | 5,823 |
Liabilities | ||
Unearned revenue | $ 3,911 | $ 5,397 |
Organization And Summary Of S_7
Organization And Summary Of Significant Accounting Policies (Activity In Allowance For Doubtful Accounts) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Organization And Summary Of Significant Accounting Policies [Abstract] | ||
Allowance for doubtful account, Balance at Beginning of Period | $ 970 | $ 221 |
Allowance for doubtful account, Recovery | (86) | |
Allowance for doubtful account, Bad Debt Expense | 789 | |
Allowance for doubtful account, Write-Offs Charged to Allowance | (124) | (41) |
Allowance for doubtful account, Effects Of Foreign Currency Exchange Rates | 11 | 1 |
Allowance for doubtful account, Balance at End of Period | $ 771 | $ 970 |
Organization And Summary Of S_8
Organization And Summary Of Significant Accounting Policies (Activity In Allowance For Unbilled Work-In-Progress) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Organization And Summary Of Significant Accounting Policies [Abstract] | ||
Allowance for unbilled work-in-progress, Balance at Beginning of Period | $ 107 | |
Allowance for unbilled work-in-progress, Unbilled Work-in-Progress Allowance/(Recovery) | 454 | 107 |
Allowance for unbilled work-in-progress, Write-Offs Charged to Allowance | 2 | |
Allowance for unbilled work-in-progress, Effects of Foreign Currency Exchange Rates | (11) | |
Allowance for unbilled work-in-progress, Balance at End of Period | $ 552 | $ 107 |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) £ in Thousands, € in Millions | Sep. 04, 2017EUR (€)entity | Sep. 04, 2017USD ($) | Jul. 03, 2017GBP (£) | Jul. 03, 2017USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Nov. 02, 2018USD ($) | Jun. 30, 2018USD ($) | Sep. 04, 2017USD ($)entity | Dec. 31, 2016USD ($) |
Business Acquisition [Line Items] | ||||||||||
Goodwill | $ 6,738,000 | $ 25,216,000 | $ 20,599,000 | |||||||
Other income (expense) | 393,000 | 23,000 | ||||||||
Amount of increase to amortization expense if measurement period adjustments were reflected in annual report | 1,000 | |||||||||
Amortization expense | 200,000 | |||||||||
Measurement period adjustment to goodwill and intangible assets | 263,000 | |||||||||
EVOL BLS [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Percentage of revenue over defined threshold levels | 50.00% | |||||||||
Revenue over defined threshold levels period | 3 years | 3 years | ||||||||
Goodwill | $ 278,000 | |||||||||
Other income (expense) | 400,000 | |||||||||
Contingent earn-out liability | $ 400,000 | $ 400,000 | $ 800,000 | $ 800,000 | ||||||
Cash from asset purchase agreement | £ 1,200 | $ 1,600,000 | ||||||||
Weighted average amortization period | 6 years | 6 years | 4 years 10 months 24 days | 5 years 10 months 17 days | ||||||
Pro forma revenue | $ 1,400,000 | |||||||||
Pro forma net profit (loss) | $ (2,000,000) | |||||||||
Measurement period adjustment to goodwill and intangible assets | $ 0 | |||||||||
Intangible assets | 264,000 | |||||||||
EVOL BLS [Member] | Additional Sum [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash from asset purchase agreement | £ 100 | $ 134,000 | ||||||||
Lumata Entities [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Goodwill | $ 3,307,000 | |||||||||
Weighted average amortization period | 10 years | 10 years | 9 years 4 months 24 days | 10 years 4 months 24 days | ||||||
Number of acquisition subsidiaries acquired all issued and outstanding shares | entity | 4 | 4 | ||||||||
Cash payment for shares acquired | € 4 | $ 4,800,000 | ||||||||
Pro forma revenue | $ 4,600,000 | |||||||||
Pro forma net profit (loss) | $ (200,000) | |||||||||
Intangible assets | $ 1,935,000 | |||||||||
Minimum [Member] | EVOL BLS [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Percentage of collections on receivables period | 24 months | 24 months | ||||||||
No solicitation provision period | 2 years | 2 years | ||||||||
Revenue benchmark | $ 4,800,000 | |||||||||
Maximum [Member] | Lumata Entities [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Recovery amount from the guarantor | € 0.4 | 500,000 | ||||||||
Attributed Primarily To Expected Synergies And Assembled Workforce [Member] | EVOL BLS [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Goodwill | 300,000 | |||||||||
Attributed Primarily To Expected Synergies And Assembled Workforce [Member] | Lumata Entities [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Goodwill | 3,100,000 | |||||||||
Changes In Contract Receivables And Unbilled Work In Progress [Member] | Lumata Entities [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Goodwill | 200,000 | |||||||||
Changes In Contract Receivables And Unbilled Work In Progress [Member] | Maximum [Member] | EVOL BLS [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Goodwill | 100,000 | |||||||||
Trademarks And Tradenames [Member] | EVOL BLS [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average amortization period | 0 years | 6 months | ||||||||
Trademarks And Tradenames [Member] | Lumata Entities [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average amortization period | 4 years | 5 years | ||||||||
Purchased Software [Member] | EVOL BLS [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average amortization period | 4 years | 5 years | ||||||||
Purchased Software [Member] | Lumata Entities [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average amortization period | 6 years | 7 years | ||||||||
Non-competition [Member] | EVOL BLS [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average amortization period | 1 year | 1 year 6 months | ||||||||
Non-competition [Member] | Lumata Entities [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average amortization period | 4 months 24 days | 1 year 6 months | ||||||||
Customer Relationships [Member] | EVOL BLS [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average amortization period | 6 years | 7 years | ||||||||
Customer Relationships [Member] | Lumata Entities [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average amortization period | 12 years | 13 years | ||||||||
Preliminary [Member] | EVOL BLS [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Goodwill | 249,000 | |||||||||
Intangible assets | $ 246,000 | |||||||||
Preliminary [Member] | Lumata Entities [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Goodwill | 3,073,000 | |||||||||
Intangible assets | $ 1,935,000 |
Acquisitions (Summary Of Total
Acquisitions (Summary Of Total Purchase Price) (Details) - USD ($) $ in Thousands | Sep. 04, 2017 | Jul. 03, 2017 |
EVOL BLS [Member] | ||
Cash Consideration | ||
Total cash consideration | $ 1,553 | |
Earnout | 427 | |
Total purchase price | 1,980 | |
EVOL BLS [Member] | Preliminary [Member] | ||
Cash Consideration | ||
Total cash consideration | 1,553 | |
Earnout | 380 | |
Total purchase price | 1,933 | |
EVOL BLS [Member] | Measurement Period Adjustments [Member] | ||
Cash Consideration | ||
Total cash consideration | ||
Earnout | 47 | |
Total purchase price | $ 47 | |
Lumata Entities [Member] | ||
Cash Consideration | ||
Cash Consideration | $ 4,766 | |
Total purchase price | 4,766 | |
Lumata Entities [Member] | Preliminary [Member] | ||
Cash Consideration | ||
Cash Consideration | 4,766 | |
Total purchase price | 4,766 | |
Lumata Entities [Member] | Measurement Period Adjustments [Member] | ||
Cash Consideration | ||
Cash Consideration | ||
Total purchase price |
Acquisitions (Schedule Of Asset
Acquisitions (Schedule Of Assets Acquired And Liabilities Assumed At Acquisition Date) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Sep. 04, 2017 | Jul. 03, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 6,738 | $ 25,216 | $ 20,599 | ||
EVOL BLS [Member] | |||||
Business Acquisition [Line Items] | |||||
Contract receivables | $ 1,037 | ||||
Unbilled work-in-progress | 1,039 | ||||
Intangible assets | 264 | ||||
Prepaid and other current assets | 437 | ||||
Other assets, non-current | 55 | ||||
Total identifiable assets acquired | 2,832 | ||||
Accounts payable and accrued liabilities | 792 | ||||
Deferred revenue | 338 | ||||
Total identifiable liabilities acquired | 1,130 | ||||
Net identifiable assets acquired | 1,702 | ||||
Goodwill | 278 | ||||
Net assets acquired | 1,980 | ||||
Lumata Entities [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | $ 386 | ||||
Contract receivables | 1,444 | ||||
Unbilled work-in-progress | 28 | ||||
Intangible assets | 1,935 | ||||
Prepaid and other current assets | 1,539 | ||||
Other assets, non-current | 19 | ||||
Total identifiable assets acquired | 5,351 | ||||
Accounts payable and accrued liabilities | 3,086 | ||||
Deferred tax liability | 329 | ||||
Deferred revenue | 477 | ||||
Total identifiable liabilities acquired | 3,892 | ||||
Net identifiable assets acquired | 1,459 | ||||
Goodwill | 3,307 | ||||
Net assets acquired | 4,766 | ||||
Preliminary [Member] | EVOL BLS [Member] | |||||
Business Acquisition [Line Items] | |||||
Contract receivables | 1,037 | ||||
Unbilled work-in-progress | 1,039 | ||||
Intangible assets | 246 | ||||
Prepaid and other current assets | 437 | ||||
Other assets, non-current | 55 | ||||
Total identifiable assets acquired | 2,814 | ||||
Accounts payable and accrued liabilities | 792 | ||||
Deferred revenue | 338 | ||||
Total identifiable liabilities acquired | 1,130 | ||||
Net identifiable assets acquired | 1,684 | ||||
Goodwill | 249 | ||||
Net assets acquired | 1,933 | ||||
Preliminary [Member] | Lumata Entities [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 | ||||
Measurement Period Adjustments [Member] | EVOL BLS [Member] | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 18 | ||||
Total identifiable assets acquired | 18 | ||||
Net identifiable assets acquired | 18 | ||||
Goodwill | 29 | ||||
Net assets acquired | $ 47 | ||||
Measurement Period Adjustments [Member] | Lumata Entities [Member] | |||||
Business Acquisition [Line Items] | |||||
Unbilled work-in-progress | (82) | ||||
Total identifiable assets acquired | (82) | ||||
Deferred revenue | 152 | ||||
Total identifiable liabilities acquired | 152 | ||||
Net identifiable assets acquired | (234) | ||||
Goodwill | $ 234 |
Acquisitions (Intangible Assets
Acquisitions (Intangible Assets Related To Acquisition) (Details) - USD ($) $ in Thousands | Sep. 04, 2017 | Jul. 03, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Net Carrying Amount | $ 4,550 | $ 5,613 | ||||
Maximum [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Functional currency adjustment | 100 | |||||
EVOL BLS [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Gross Amount | 260 | [1] | 255 | |||
Accumulated Amortization | 73 | [1] | 25 | |||
Net Carrying Amount | $ 187 | $ 230 | ||||
Weighted-Average Amortization Period | 6 years | 4 years 10 months 24 days | 5 years 10 months 17 days | |||
EVOL BLS [Member] | Purchased Software [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Gross Amount | $ 98 | $ 102 | ||||
Accumulated Amortization | 29 | 9 | ||||
Net Carrying Amount | $ 69 | $ 93 | ||||
Weighted-Average Amortization Period | 4 years | 5 years | ||||
EVOL BLS [Member] | Trademarks And Tradenames [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Gross Amount | $ 9 | $ 10 | ||||
Accumulated Amortization | $ 9 | 7 | ||||
Net Carrying Amount | $ 3 | |||||
Weighted-Average Amortization Period | 0 years | 6 months | ||||
EVOL BLS [Member] | Non-competition [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Gross Amount | $ 4 | $ 4 | ||||
Accumulated Amortization | 3 | 1 | ||||
Net Carrying Amount | $ 1 | $ 3 | ||||
Weighted-Average Amortization Period | 1 year | 1 year 6 months | ||||
EVOL BLS [Member] | Customer Relationships [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Gross Amount | $ 149 | $ 139 | ||||
Accumulated Amortization | 32 | 8 | ||||
Net Carrying Amount | $ 117 | $ 131 | ||||
Weighted-Average Amortization Period | 6 years | 7 years | ||||
EVOL BLS [Member] | Maximum [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Functional currency adjustment | $ 100 | |||||
Lumata Entities [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Gross Amount | [1] | 1,903 | $ 2,017 | |||
Accumulated Amortization | [1] | 273 | 72 | |||
Net Carrying Amount | $ 1,630 | $ 1,945 | ||||
Weighted-Average Amortization Period | 10 years | 9 years 4 months 24 days | 10 years 4 months 24 days | |||
Lumata Entities [Member] | Purchased Software [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Gross Amount | $ 661 | $ 700 | ||||
Accumulated Amortization | 126 | 33 | ||||
Net Carrying Amount | $ 535 | $ 667 | ||||
Weighted-Average Amortization Period | 6 years | 7 years | ||||
Lumata Entities [Member] | Trademarks And Tradenames [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Gross Amount | $ 109 | $ 115 | ||||
Accumulated Amortization | 29 | 8 | ||||
Net Carrying Amount | $ 80 | $ 107 | ||||
Weighted-Average Amortization Period | 4 years | 5 years | ||||
Lumata Entities [Member] | Non-competition [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Gross Amount | $ 2 | $ 2 | ||||
Accumulated Amortization | $ 2 | |||||
Net Carrying Amount | $ 2 | |||||
Weighted-Average Amortization Period | 4 months 24 days | 1 year 6 months | ||||
Lumata Entities [Member] | Customer Relationships [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Gross Amount | $ 1,131 | $ 1,200 | ||||
Accumulated Amortization | 116 | 31 | ||||
Net Carrying Amount | $ 1,015 | $ 1,169 | ||||
Weighted-Average Amortization Period | 12 years | 13 years | ||||
Lumata Entities [Member] | Maximum [Member] | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Functional currency adjustment | $ 100 | $ 100 | ||||
[1] | Includes functional currency adjustment of less than $0.1 million. |
Acquisitions (Schedule Of Pro F
Acquisitions (Schedule Of Pro Forma Information) (Details) - EVOL BLS And Lumata Entities [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue | $ 30,636 | $ 34,821 |
Net (loss) income | $ (14,787) | $ 144 |
Goodwill And Intangible Asset_2
Goodwill And Intangible Assets (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Goodwill And Intangible Assets [Line Items] | |||
Goodwill | $ 6,738 | $ 25,216 | $ 20,599 |
Goodwill impairment, fair value | 17,760 | ||
Goodwill impairment loss | 17,760 | ||
Amortization of intangible assets | $ 970 | $ 860 | |
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 Asset_3
Goodwill And Intangible Assets (Summary Of Changes In Carrying Amount Of Goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Goodwill And Intangible Assets [Abstract] | |||
Balance at beginning of the period | $ 25,216 | $ 20,599 | |
Goodwill aquired during the year | 3,322 | ||
Measurement period adjustments | 263 | ||
Goodwill impairment loss | (17,760) | ||
Effects of changes in foreign currency exchange rates | [1] | (981) | 1,295 |
Balance at ending of the period | $ 6,738 | $ 25,216 | |
[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 Asset_4
Goodwill And Intangible Assets (Summary Of Identifiable Intangible Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | |||
Finite-Lived Intangible Assets [Line Items] | ||||
Net Carrying Amount | $ 4,550 | $ 5,613 | ||
Evolving Systems Labs, Evolving System NC, Evolving System BLS LTD, And Lumata [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross Amount | 7,522 | [1] | 7,634 | |
Accumulated Amortization | (2,972) | [2] | (2,021) | [3] |
Net Carrying Amount | $ 4,550 | $ 5,613 | ||
Weighted-Average Amortization Period | 5 years 9 months 18 days | 6 years 9 months 18 days | ||
Evolving Systems Labs, Evolving System NC, Evolving System BLS LTD, And Lumata [Member] | Purchased Software [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross Amount | $ 2,877 | $ 2,921 | ||
Accumulated Amortization | (1,121) | (743) | ||
Net Carrying Amount | $ 1,756 | $ 2,178 | ||
Weighted-Average Amortization Period | 6 years 8 months 12 days | 7 years 8 months 12 days | ||
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 | $ 303 | $ 310 | ||
Accumulated Amortization | (223) | (189) | ||
Net Carrying Amount | $ 80 | $ 121 | ||
Weighted-Average Amortization Period | 2 years 8 months 12 days | 3 years 8 months 12 days | ||
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 | $ 40 | ||
Accumulated Amortization | (38) | (35) | ||
Net Carrying Amount | $ 1 | $ 5 | ||
Weighted-Average Amortization Period | 1 year | 2 years | ||
Evolving Systems Labs, Evolving System NC, Evolving System BLS LTD, And Lumata [Member] | Customer Relationships [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross Amount | $ 4,303 | $ 4,363 | ||
Accumulated Amortization | (1,590) | (1,054) | ||
Net Carrying Amount | $ 2,713 | $ 3,309 | ||
Weighted-Average Amortization Period | 7 years 8 months 12 days | 8 years 8 months 12 days | ||
Maximum [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Functional currency adjustment | $ 100 | |||
[1] | 2018 increase in gross amount due to measurement period adjustments relating to the EVOL BLS purchase price allocation. See Note 2 - Acquisitions for additional information. Includes functional currency adjustment of $0.1 million | |||
[2] | Includes functional currency adjustment of less than $0.1 million. | |||
[3] |
Goodwill And Intangible Asset_5
Goodwill And Intangible Assets (Summary Of Expected Future Amortization Expense Related To Identifiable Intangibles) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Year ending December 31, | ||
2019 | $ 938 | |
2020 | 937 | |
2021 | 923 | |
2022 | 738 | |
2023 | 360 | |
Thereafter | 654 | |
Net Carrying Amount | $ 4,550 | $ 5,613 |
Balance Sheet Components (Accou
Balance Sheet Components (Accounts Payable And Accrued Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Balance Sheet Components [Abstract] | ||
Accounts payable | $ 1,276 | $ 1,530 |
Accrued compensation and related expenses | 1,863 | 1,749 |
Accrued liabilities | 1,344 | 3,399 |
Accounts payable and accrued liabilities | $ 4,483 | $ 6,678 |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) € in Millions | Aug. 16, 2017EUR (€) | Aug. 16, 2017USD ($)item | Feb. 29, 2016USD ($)item | Dec. 31, 2018USD ($) |
Debt Instrument [Line Items] | ||||
Origination fee | $ 23,650 | |||
Term Loan [Member] | East West Bank [Member] | ||||
Debt Instrument [Line Items] | ||||
Loan amount | $ 6,000,000 | $ 5,900,000 | ||
Number of monthly installments of principal | item | 36 | |||
Maturity date | Jan. 1, 2020 | |||
Fixed charge ratio | 0.81% | |||
Debt issuance costs | $ 5,000 | |||
Term Loan [Member] | East West Bank [Member] | Prime Rate [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 5.50% | |||
Rate plus prime rate | 1.00% | |||
Loan Facility [Member] | Lumata Entities [Member] | ||||
Debt Instrument [Line Items] | ||||
Total cash consideration | € 4 | 4,800,000 | ||
Loan Facility [Member] | East West Bank [Member] | ||||
Debt Instrument [Line Items] | ||||
Monthly principal payment | $ 100,000 | |||
Interest rate | 3.50% | |||
Rate plus prime rate | 1.50% | 1.50% | ||
Number of remaining payments | item | 3 | |||
Maturity date | Aug. 16, 2021 | Aug. 16, 2021 | ||
Increment amount | $ 50,000 | |||
Prepayment fee percentage | 2.00% | 2.00% | ||
Loan Facility [Member] | East West Bank [Member] | Prime Rate [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 5.50% | |||
Revolving Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Number of payment for annual credit facility fees | item | 2 | |||
Minimum [Member] | Term Loan [Member] | East West Bank [Member] | ||||
Debt Instrument [Line Items] | ||||
Requirement fixed charge coverage ratio | 1.25% | |||
Minimum [Member] | Loan Facility [Member] | East West Bank [Member] | ||||
Debt Instrument [Line Items] | ||||
Prepayment amount | $ 250,000 | |||
Maximum [Member] | Revolving Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Legal fee | $ 100,000 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 | Sep. 30, 2017 | Sep. 30, 2015 | Oct. 31, 2013 | |
Income Taxes [Line Items] | ||||||
Net income tax (benefit) expense | $ (426) | $ 1,421 | ||||
Current income tax expense | 520 | $ 1,912 | ||||
Deferred tax benefit | $ 900 | |||||
Effective tax rate | 25.60% | 38.00% | ||||
Federal net operating loss carryforwards | $ 0 | $ 0 | ||||
State NOL | 27,500 | 28,900 | ||||
Deferred tax assets | 1,140 | 274 | ||||
Net operating loss carryforwards - Foreign | 5,531 | 5,596 | ||||
Research and experimentation credit carryforwards | 303 | 303 | ||||
State net operating loss carryforwards | $ 887 | $ 914 | ||||
U.S. corporate tax rate | 21.00% | 34.00% | ||||
Decrease in income tax expense related to reduction in tax rate | $ (108) | |||||
Foreign tax credit | $ 500 | |||||
Excess tax benefit from employee stock plan awards | 0 | 0 | ||||
Unrecognized tax benefits | 0 | 0 | ||||
Foreign tax credits carryforwards | 4,788 | 4,731 | ||||
AMT credit | 770 | 770 | ||||
Valuation allowance | 10,932 | 11,544 | ||||
Income (Loss) from Subsidiaries, before tax | 5,500 | |||||
Subsequent Event [Member] | ||||||
Income Taxes [Line Items] | ||||||
Foreign tax credits carryforwards | $ 4,800 | |||||
FTC Carryforwards [Member] | ||||||
Income Taxes [Line Items] | ||||||
Deferred tax benefit | 500 | |||||
Evolving Systems NC, Inc [Member] | ||||||
Income Taxes [Line Items] | ||||||
Deferred tax liability | $ 1,800 | |||||
U.K. Operations [Member] | FTC Carryforwards [Member] | ||||||
Income Taxes [Line Items] | ||||||
Deferred tax liability | 200 | |||||
Operating losses | $ 200 | |||||
U.S., U.K., France And India Operations [Member] | ||||||
Income Taxes [Line Items] | ||||||
Current income tax expense | 1,900 | |||||
Deferred tax benefit | 500 | |||||
Minimum [Member] | Foreign Net Operating Loss Carryforwards [Member] | ||||||
Income Taxes [Line Items] | ||||||
Operating loss carryforwards expiration year | 2019 | |||||
Minimum [Member] | State [Member] | ||||||
Income Taxes [Line Items] | ||||||
Operating loss carryforwards expiration year | 2019 | |||||
Maximum [Member] | Foreign Net Operating Loss Carryforwards [Member] | ||||||
Income Taxes [Line Items] | ||||||
Operating loss carryforwards expiration year | 2037 | |||||
Maximum [Member] | State [Member] | ||||||
Income Taxes [Line Items] | ||||||
Operating loss carryforwards expiration year | 2037 | |||||
Evolving Systems Labs [Member] | ||||||
Income Taxes [Line Items] | ||||||
Deferred tax assets | $ 100 | |||||
Lumata Entities [Member] | ||||||
Income Taxes [Line Items] | ||||||
Deferred tax liability | $ 400 | |||||
Evolving Systems Labs, Evolving Systems NC, and Lumata Entities [Member] | ||||||
Income Taxes [Line Items] | ||||||
Net deferred tax liabilities | $ 700 | $ 800 |
Income Taxes (Pre-Tax Income Fr
Income Taxes (Pre-Tax Income From Continuing Operations) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes [Abstract] | ||
Domestic | $ (17,820) | $ (4,168) |
Foreign | 2,607 | 8,105 |
Total | $ (15,213) | $ 3,937 |
Income Taxes (Expense (Benefit)
Income Taxes (Expense (Benefit) From Continuing Operations For Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes [Abstract] | ||
Current: Federal | $ 340 | $ (108) |
Current: Foreign | 155 | 1,998 |
Current: State | 25 | 22 |
Total current | 520 | 1,912 |
Deferred: Federal | 41 | (444) |
Deferred: Foreign | (987) | (47) |
Total deferred | (946) | (491) |
Total tax (benefit) expense | $ (426) | $ 1,421 |
Income Taxes (Components Of Def
Income Taxes (Components Of Deferred Tax Assets And Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets: | ||
Foreign tax credits carryforwards | $ 4,788 | $ 4,731 |
Net operating loss carryforwards - Foreign | 5,531 | 5,596 |
Net operating loss carryforwards - State | 887 | 914 |
Research & development credits | 303 | 303 |
AMT credit | 770 | 770 |
Stock compensation | 559 | 570 |
Depreciable assets | 38 | 33 |
Accrued liabilities and reserves | 67 | 66 |
Total deferred tax assets | 12,943 | 12,983 |
Deferred tax liabilities: | ||
Intangibles | (697) | (1,045) |
Accrued liabilities and reserves | (174) | (120) |
Total deferred tax liability | (871) | (1,165) |
Net deferred tax assets, before valuation allowance | 12,072 | 11,818 |
Valuation allowance | (10,932) | (11,544) |
Net deferred tax asset | $ 1,140 | $ 274 |
Income Taxes (Income Tax Expens
Income Taxes (Income Tax Expense Reconciliation) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes [Abstract] | ||
U.S. federal income tax expense at statutory rates | $ (3,920) | $ 1,776 |
State income tax expense, net of federal impact | 23 | 22 |
Foreign Tax Credit | (848) | |
Foreign rate differential | 540 | (1,312) |
Foreign deemed dividends | 1,311 | |
Change in valuation allowance | (274) | 844 |
Research and development expenses | (1,167) | (305) |
Foreign taxes | 18 | |
Section 78 Gross-up | 311 | |
US Tax Reform | (108) | |
Goodwill impairment loss | 4,188 | |
Permanent differences and other, net | 184 | (288) |
Total tax (benefit) expense | $ (426) | $ 1,421 |
Stockholders' Equity (Narrative
Stockholders' Equity (Narrative) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2018 | |
Stockholders' Equity [Line Items] | ||
Accrued dividends | $ 0 | $ 0 |
Treasury stock, shares | 178,889 | 178,889 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Anti-takeover provisions period | 3 years | |
2014 Stock Purchase Program [Member] | ||
Stockholders' Equity [Line Items] | ||
Treasury stock, shares | 178,669 | 178,669 |
Share-Based Compensation (Narra
Share-Based Compensation (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||||||
Jun. 30, 2015 | Jun. 30, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2018 | Dec. 31, 2016 | Jun. 30, 2016 | Jun. 30, 2013 | Jun. 30, 2010 | Jun. 30, 2007 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Share-based compensation expense | $ 702 | $ 742 | ||||||||
Total unrecognized compensation costs | $ 1,000 | |||||||||
Weighted average recognition period | 2 years 3 months 18 days | |||||||||
Restricted Stock [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares restricted stock forfeited | 70,000 | |||||||||
Stock Options [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock options outstanding | 591,000 | 713,000 | 684,000 | |||||||
Weighted-average grant-date fair value of stock options granted | $ 1.84 | $ 1.87 | ||||||||
Fair value of stock options vested | $ 200 | $ 200 | ||||||||
Net settlement exercises shares issued | 0 | 20,000 | ||||||||
Net settlement exercises shares cancelled | 80,000 | |||||||||
Intrinsic value of stock option exercises, total | $ 100 | $ 100 | ||||||||
Stock Options [Member] | January 2018 [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Percentage of vested stock awards granted | 20.00% | |||||||||
Stock Options [Member] | One Year Anniversary Of Offering [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Percentage of vested stock awards granted | 10.00% | |||||||||
Stock Options [Member] | Evenly Over Four Years [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Percentage of vested stock awards granted | 40.00% | |||||||||
2007 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Shares available for grant | 0 | 0 | ||||||||
Shares issued and outstanding | 500,000 | 700,000 | ||||||||
2016 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Shares available for grant | 400,000 | 100,000 | ||||||||
Shares issued and outstanding | 400,000 | 600,000 | ||||||||
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] | ||||||||||
Number of shares authorized | 550,000 | |||||||||
Maximum employee subscription rate | 15.00% | |||||||||
Maximum value of shares per employee | $ 25 | |||||||||
Maximum number of shares per employee | 10,000 | |||||||||
Purchase price of stock | 85.00% | |||||||||
Shares available for purchase under ESPP | 50,000 | |||||||||
Discount on the purchase price of stock option | 15.00% | |||||||||
Employee stock purchase plan compensation expense | $ 0 | $ 0 | ||||||||
Maximum [Member] | Stock Options [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Cash received from exercise of stock options | $ 100 | $ 100 | ||||||||
Maximum [Member] | 2007 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Option expiration period | 10 years | |||||||||
Number of shares authorized | 2,000,000 | 1,500,000 | 1,250,000 | 1,000,000 | ||||||
Maximum [Member] | 2016 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Option expiration period | 10 years | |||||||||
Number of shares authorized | 850,000 | 250,000 | ||||||||
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 | |||||||||
Senior Management [Member] | Restricted Stock [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Vested period for stock awards granted | 4 years | |||||||||
Stock option awarded | 600,000 | |||||||||
Board Members [Member] | Restricted Stock [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Vested period for stock awards granted | 1 year | |||||||||
Board Members And Senior Management [Member] | Restricted Stock [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Vesting period | 4 years | |||||||||
Restricted stock granted in period | 200,000 | |||||||||
Number of shares restricted stock vested | 180,000 | 10,000 | ||||||||
Number of shares restricted stock forfeited | 30,000 | |||||||||
Restricted stock-based compensation expense | $ 500 | $ 600 | ||||||||
Evolving Systems U.K. [Member] | Maximum [Member] | Stock Options [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Deferred income tax benefits from stock option expense | $ 100 | $ 100 |
Share-Based Compensation (Summa
Share-Based Compensation (Summary Of Stock-Based Compensation Expenses) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation | $ 702 | $ 742 |
Cost Of Revenue, Excluding Depreciation And Amortization [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation | 52 | 26 |
Sales And Marketing [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation | 39 | 28 |
General And Administrative [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation | 590 | 611 |
Product Development [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation | $ 21 | $ 77 |
Share-Based Compensation (Sum_2
Share-Based Compensation (Summary Of Restricted Stock Activity) (Details) - Restricted Stock [Member] - shares shares in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Unvested restricted stock at December 31 | 597 | 15 |
Add restricted stock granted | 622 | |
Less restricted stock vested | (181) | (5) |
Less restricted stock forfeited/expired | (67) | (35) |
Unvested restricted stock at December 31 | 349 | 597 |
Share-Based Compensation (Assum
Share-Based Compensation (Assumptions For Weighted Average Fair Value) (Details) - Stock Options [Member] | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected term (years) | 6 years | 6 years 4 months 24 days |
Risk-free interest rate | 2.90% | 2.15% |
Expected volatility | 38.43% | 38.86% |
Expected dividend yield | 0.00% | 0.00% |
Share-Based Compensation (Sum_3
Share-Based Compensation (Summary Of Stock Option Activity) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-Average Remaining Contractual Term (Years), Options outstanding | 7 years 4 months 21 days | 8 years 2 months 23 days | 7 years 3 months 18 days |
Weighted-Average Remaining Contractual Term (Years), Option exercisable at December 31, 2018 | 6 years 8 months 1 day | ||
Stock Options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of Shares, Options outstanding at beginning | 713 | 684 | |
Number of Shares, Less forfeited/cancelled | (142) | (233) | |
Number of Shares, Less options exercised | (10) | (108) | |
Number of Shares, Add options granted | 30 | 370 | |
Number of Shares, Options outstanding at ending | 591 | 713 | 684 |
Number of Shares, Option exercisable at December 31, 2018 | 368 | ||
Weighted-Average Exercise Price, Options outstanding at beginning | $ 5.71 | $ 6.17 | |
Weighted-Average Exercise Price, Less options forfeited/cancelled | 5.20 | 5.50 | |
Weighted-Average Exercise Price, Less options exercised | 0.40 | 2.46 | |
Weighted-Average Exercise Price, Add options granted | 2.25 | 4.53 | |
Weighted-Average Exercise Price, Options outstanding at ending | 5.75 | $ 5.71 | $ 6.17 |
Weighted-Average Exercise Price, Options exercisable at December 31, 2018 | $ 6.51 | ||
Aggregate Intrinsic Value, Options outstanding at beginning | $ 128 | $ 139 | |
Aggregate Intrinsic Value, Options outstanding at ending | $ 128 | $ 139 |
Share-Based Compensation (Sum_4
Share-Based Compensation (Summary Of Stock Option Outstanding By Exercise Price Ranges) (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
$ 0.01 - $4.46 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower Range | $ 0.01 |
Range of Exercise Prices, Upper Range | $ 4.46 |
Stock Options Outstanding, Number of Shares | shares | 40,608 |
Stock Options Outstanding, Weighted Average Remaining Contractual Life (Years) | 7 years 9 months 26 days |
Stock Options Outstanding, Weighted Exercise Price | $ 2.65 |
Stock Options Exercisable, Number of Shares | shares | 10,608 |
Stock Options Exerciable, Weighted Exercise Price | $ 3.78 |
$ 4.47 - $4.55 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower Range | 4.47 |
Range of Exercise Prices, Upper Range | $ 4.55 |
Stock Options Outstanding, Number of Shares | shares | 171,875 |
Stock Options Outstanding, Weighted Average Remaining Contractual Life (Years) | 8 years 10 months 2 days |
Stock Options Outstanding, Weighted Exercise Price | $ 4.50 |
Stock Options Exercisable, Number of Shares | shares | 59,375 |
Stock Options Exerciable, Weighted Exercise Price | $ 4.50 |
$ 4.56 - $5.90 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower Range | 4.56 |
Range of Exercise Prices, Upper Range | $ 5.90 |
Stock Options Outstanding, Number of Shares | shares | 91,175 |
Stock Options Outstanding, Weighted Average Remaining Contractual Life (Years) | 7 years 11 months 19 days |
Stock Options Outstanding, Weighted Exercise Price | $ 5 |
Stock Options Exercisable, Number of Shares | shares | 45,532 |
Stock Options Exerciable, Weighted Exercise Price | $ 5.27 |
$ 5.91 - $6.23 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower Range | 5.91 |
Range of Exercise Prices, Upper Range | $ 6.23 |
Stock Options Outstanding, Number of Shares | shares | 179,500 |
Stock Options Outstanding, Weighted Average Remaining Contractual Life (Years) | 6 years 9 months |
Stock Options Outstanding, Weighted Exercise Price | $ 6 |
Stock Options Exercisable, Number of Shares | shares | 145,843 |
Stock Options Exerciable, Weighted Exercise Price | $ 6 |
$ 6.24 - $10.90 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower Range | 6.24 |
Range of Exercise Prices, Upper Range | $ 10.90 |
Stock Options Outstanding, Number of Shares | shares | 107,851 |
Stock Options Outstanding, Weighted Average Remaining Contractual Life (Years) | 5 years 5 months 27 days |
Stock Options Outstanding, Weighted Exercise Price | $ 9.13 |
Stock Options Exercisable, Number of Shares | shares | 106,570 |
Stock Options Exerciable, Weighted Exercise Price | $ 9.13 |
Benefit Plans (Narrative) (Deta
Benefit Plans (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Benefit Plans [Abstract] | ||
Employer contribution requirement, percentage | 3.00% | |
Employer contribution vesting period | 3 years | |
Employer matching contribution, percent | 5.00% | |
Benefit plans recorded expense | $ 0.4 | $ 0.2 |
(Loss) Earnings Per Share (Narr
(Loss) Earnings Per Share (Narrative) (Details) - shares shares in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
(Loss) Earnings Per Share [Abstract] | ||
Unvested shares excluded from earnings per share calculation | 0.6 | 0.4 |
(Loss) Earnings Per Share (Summ
(Loss) Earnings Per Share (Summary Of Basic And Diluted Earnings (Loss) Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Basic (loss) income per common share: | ||
Net (loss) income | $ (14,787) | $ 2,516 |
Basic weighted average shares outstanding | 12,108,000 | 11,934,000 |
Basic (loss) income per common share: | $ (1.22) | $ 0.21 |
Diluted (loss) income per common share: | ||
Net (loss) income | $ (14,787) | $ 2,516 |
Weighted average shares outstanding | 12,108,000 | 11,934,000 |
Effect of dilutive securities - options and restricted stock | 47,000 | |
Diluted weighted average shares outstanding | 12,108,000 | 11,981,000 |
Diluted (loss) income per common share: | $ (1.22) | $ 0.21 |
Commitments And Contingencies_2
Commitments And Contingencies (Narrative) (Details) - USD ($) $ in Millions | Oct. 24, 2014 | Dec. 31, 2018 | Dec. 31, 2017 |
Other Commitments [Line Items] | |||
Rent expense | $ 0.7 | $ 0.6 | |
Sublease rental income | 0 | 0 | |
Litigation settlement, amount agreed to pay other party | 0.3 | ||
Litigation settlement, paid by company | 0.1 | ||
Litigation settlement, amount released | 0.3 | ||
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 | ||
Final cash payment | $ 0.5 | ||
Other income | $ 0.5 |
Commitments And Contingencies_3
Commitments And Contingencies (Future Minimum Commitments) (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Commitments And Contingencies [Abstract] | |
Operating Leases, 2019 | $ 509 |
Operating Leases, 2020 | 357 |
Operating Leases, 2021 | 253 |
Operating Leases, 2022 | 252 |
Operating Leases, Thereafter | 99 |
Operating Lease, Total | 1,470 |
Total Commitments,, 2019 | 509 |
Total Commitments, 2020 | 357 |
Total Commitments, 2021 | 253 |
Total Commitments, 2022 | 252 |
Total Commitments, Thereafter | 99 |
Total Commitments, Total | $ 1,470 |
Geographical Information (Long-
Geographical Information (Long-Lived Assets, Net By Geographic Region) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | $ 11,591 | $ 31,087 |
United States [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | 2,741 | 11,276 |
United Kingdom [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | 7,098 | 17,968 |
Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | $ 1,752 | $ 1,843 |
Restructuring (Narrative) (Deta
Restructuring (Narrative) (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2018 | |
Restructuring Cost and Reserve [Line Items] | |||
Restructuring expense | $ 286 | ||
Restructuring liability | $ 0 | $ 0 | $ 0 |
Evolving Systems NC, Inc [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Expense of termination employees | $ 300 |