Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 10, 2021 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Fiscal Period Focus | Q1 | |
Document Period End Date | Mar. 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-34261 | |
Entity Registrant Name | EVOLVING SYSTEMS INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 84-1010843 | |
Entity Address, Address Line One | 9800 Pyramid Court | |
Entity Address, Address Line Two | Suite 400 | |
Entity Address, City or Town | Englewood | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80112 | |
City Area Code | 303 | |
Local Phone Number | 802-1000 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | evol | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 12,226,577 | |
Entity Central Index Key | 0001052054 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 4,292 | $ 2,763 |
Contract receivables, net of allowance for doubtful accounts of $788 and $780 at March 31, 2021 and December 31, 2020, respectively | 4,741 | 5,681 |
Unbilled work-in-progress | 3,593 | 3,365 |
Prepaid and other current assets | 1,608 | 1,828 |
Income taxes receivable | 740 | 270 |
Total current assets | 14,974 | 13,907 |
Property and equipment, net | 512 | 532 |
Amortizable intangible assets, net | 2,544 | 2,769 |
Operating leases - right of use assets, net | 1,203 | 915 |
Deferred income taxes, net | 960 | 953 |
Total assets | 20,193 | 19,076 |
Current liabilities: | ||
Term loan - current portion | 142 | |
Accounts payable and accrued liabilities | 4,495 | 4,305 |
Lease obligations - operating leases | 326 | 294 |
Unearned revenue | 5,043 | 3,713 |
Total current liabilities | 9,864 | 8,454 |
Long-term liabilities: | ||
Term loan, net of current portion | 319 | 319 |
Lease obligations - operating leases, net of current portion | 870 | 613 |
Total liabilities | 11,053 | 9,386 |
Commitments and contingencies (Note 10) | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value; 2,000,000 shares authorized; no shares issued and outstanding | ||
Common stock, $0.001 par value; 40,000,000 shares authorized; 12,405,466 shares issued and 12,226,577 shares outstanding as of March 31, 2021 and 12,374,798 shares issued and 12,195,909 shares outstanding as of December 31, 2020 | 12 | 12 |
Additional paid-in capital | 99,973 | 99,776 |
Treasury stock, 178,889 shares as of March 31, 2021 and December 31, 2020, at cost | (1,253) | (1,253) |
Accumulated other comprehensive loss | (10,176) | (10,345) |
Accumulated deficit | (79,416) | (78,500) |
Total stockholders' equity | 9,140 | 9,690 |
Total liabilities and stockholders' equity | $ 20,193 | $ 19,076 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Condensed Consolidated Balance Sheets [Abstract] | ||
Allowance for doubtful accounts, contract receivables | $ 788 | $ 780 |
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 | 12,405,466 | 12,374,798 |
Common stock, shares outstanding | 12,226,577 | 12,195,909 |
Treasury stock, shares | 178,889 | 178,889 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
REVENUE | ||
Total revenue | $ 6,460 | $ 6,285 |
COSTS OF REVENUE AND OPERATING EXPENSES | ||
Costs of revenue, excluding depreciation and amortization | 2,240 | 2,136 |
Sales and marketing | 1,341 | 1,561 |
General and administrative | 1,445 | 1,414 |
Product development | 1,304 | 1,063 |
Depreciation | 62 | 50 |
Amortization | 238 | 235 |
Total costs of revenue and operating expenses | 6,630 | 6,459 |
Loss from operations | (170) | (174) |
Other (expense) income | ||
Interest income | 1 | 2 |
Interest expense | (1) | (47) |
Other (expense) income, net | (291) | 3 |
Foreign currency exchange (loss) income | (380) | 383 |
Other (expense) income, net | (671) | 341 |
(Loss) income from operations before income taxes | (841) | 167 |
Income tax expense | 75 | 199 |
Net loss | $ (916) | $ (32) |
Basic loss per common share | $ (0.08) | $ 0 |
Diluted loss per common share | $ (0.08) | $ 0 |
Weighted average basic shares outstanding | 12,206 | 12,164 |
Weighted average diluted shares outstanding | 12,206 | 12,164 |
License Fees [Member] | ||
REVENUE | ||
Total revenue | $ 178 | $ 207 |
Services [Member] | ||
REVENUE | ||
Total revenue | $ 6,282 | $ 6,078 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements Of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Condensed Consolidated Statements Of Comprehensive Loss [Abstract] | ||
Net loss | $ (916) | $ (32) |
Other comprehensive income (loss) | ||
Foreign currency translation income (loss) | 169 | (523) |
Comprehensive loss | $ (747) | $ (555) |
Condensed Consolidated Statem_3
Condensed 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, 2019 | $ 12 | $ 99,555 | $ (1,253) | $ (10,053) | $ (79,143) | $ 9,118 |
Balance, shares at Dec. 31, 2019 | 12,163,834 | |||||
Restricted stock vested, shares | 30,668 | |||||
Stock-based compensation expense | 58 | 58 | ||||
Net loss | (32) | (32) | ||||
Foreign currency translation gain (loss) | (523) | (523) | ||||
Balance at Mar. 31, 2020 | $ 12 | 99,613 | (1,253) | (10,576) | (79,175) | 8,621 |
Balance, shares at Mar. 31, 2020 | 12,194,502 | |||||
Balance at Dec. 31, 2020 | $ 12 | 99,776 | (1,253) | (10,345) | (78,500) | $ 9,690 |
Balance, shares at Dec. 31, 2020 | 12,195,909 | 12,195,909 | ||||
Restricted stock vested, shares | 30,668 | |||||
Stock-based compensation expense | 197 | $ 197 | ||||
Net loss | (916) | (916) | ||||
Foreign currency translation gain (loss) | 169 | 169 | ||||
Balance at Mar. 31, 2021 | $ 12 | $ 99,973 | $ (1,253) | $ (10,176) | $ (79,416) | $ 9,140 |
Balance, shares at Mar. 31, 2021 | 12,226,577 | 12,226,577 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (916) | $ (32) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation | 62 | 50 |
Amortization of intangible assets | 238 | 235 |
Amortization of debt issuance costs | 1 | |
Amortization of operating leases - right of use assets | 85 | 76 |
Stock-based compensation expense | 197 | 58 |
Foreign currency transaction loss (income), net | 147 | (408) |
Provision for deferred income taxes | (3) | 366 |
Change in operating assets and liabilities: | ||
Contract receivables | 933 | 1,283 |
Unbilled work-in-progress | (214) | (800) |
Prepaid and other assets | 213 | (334) |
Accounts payable and accrued liabilities | 202 | (80) |
Income taxes receivable | (459) | (587) |
Unearned revenue | 1,279 | (34) |
Lease obligations - operating leases | (83) | (77) |
Net cash provided by (used in) operating activities | 1,681 | (283) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (41) | (22) |
Net cash used in investing activities | (41) | (22) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Principal payments on notes payable | (142) | (394) |
Net cash used in financing activities | (142) | (394) |
Effect of exchange rate changes on cash and cash equivalents | 31 | 229 |
Net increase (decrease) in cash and cash equivalents | 1,529 | (470) |
Cash and cash equivalents at beginning of period | 2,763 | 3,076 |
Cash and cash equivalents at end of period | 4,292 | 2,606 |
Supplemental disclosure of cash and non-cash transactions: | ||
Interest paid | 4 | 61 |
Income taxes paid | 271 | $ 253 |
Supplemental non-cash amounts of lease liabilities arising from obtaining right-of-use assets | $ 370 |
Organization And Summary Of Sig
Organization And Summary Of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
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 . Acquisitions of BLS Limited (“EVOL BLS”), four Lumata Holdings subsidiaries, Lumata France SAS, Lumata Spain S.L., Lumata UK Ltd and Lumata Deutschland GmbH (collectively, “Lumata Entities”) in 2017, along with the acquisition of RateIntegration d/b/a Sixth Sense Media (“SSM”) in 2015, expanded our footprint in the digital marketing space. Each of these acquisitions had their own platform which we still maintain today. Through the extensive work of our product development team, we have launched the Evolution platform featuring the best of these legacy platforms on cutting edge technology. Evolution is used to operate the most innovative large-scale loyalty programs, as well as providing unique mechanics enabling gamification, optimization and personalization across a variety of channels. It enables our clients to engage with their customers at all stage of their lifecycle, providing interactive dialogue and smart recommendations through all available traditional and digital channels. The platform seamlessly integrates within the service provider’s IT infrastructure, either on-premise or on a private cloud. It can be operated or managed as a service depending on the market needs. As a supplier of real-time digital engagement solutions and services, we drive growth in customer acquisition and activation, extend customer lifetime and increase customer value and revenue in the converging mobile, entertainment, financial and retail services eco-system. Our platforms, together with our team of experienced industry experts, help service providers increase their customer lifetime value (“CLV”) over the course the customer lifecycle. Evolving Systems provides software solutions and services throughout the world. The COVID-19 global outbreak has caused instability and volatility in multiple markets where our clients conduct business. We have leveraged our ability to provide support remotely resulting in limited effect on our day-to-day operations. The inability to travel has delayed interactions with our clients on projects and in the traditional modes of sales development. We continually work with existing and new clients exploring new ways of using our products and services to enhance their business. On-going travel restrictions has caused the business to interact with clients in new ways and reduced certain costs. The long-term effects on how we conduct business in the future is still undetermined but we continue to evolve to meet client needs . We believe our current liquidity and funds from our ongoing operations will be sufficient to fund operations and meet the Company’s cash needs for future working capital and capital expenditure requirements for at least the next twelve months from the date of issuance of these condensed consolidated financial statements. In making this assessment, we considered our $4.3 million in cash and cash equivalents and our $5.1 million in working capital at March 31, 2021, along with our ability to generate positive cash flows from operations for the three months ended March 31, 2021 and year ended December 31, 2020. Interim Condensed Consolidated Financial Statements — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and in conformity with the instructions to Form 10-Q and Article 8 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures included in these condensed consolidated financial statements are adequate to make the information presented not misleading. The condensed consolidated financial statements included in this document have been prepared on the same basis as the annual consolidated financial statements, and in our opinion reflect all adjustments, which include normal recurring adjustments necessary for a fair presentation in accordance with US GAAP and SEC regulations for interim financial statements. The results for the three months ended March 31, 2021 are not necessarily indicative of the results that we will have for any subsequent period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to those statements for the year ended December 31, 2020 included in our Annual Report on Form 10-K as filed with the SEC on March 17, 2021. Use of Estimates — The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (US 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 condensed 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 reporting 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 condensed consolidated statements of operations are translated at the weighted average rate of exchange during the applicable period. The resulting unrealized cumulative translation adjustment is recorded as a component of accumulated other comprehensive loss in stockholders’ equity. Realized and unrealized transaction gains and losses generated by transactions denominated in a currency different from the functional currency of the applicable entity are recorded in other income (expense) in the period in which they occur. Principles of Consolidation — The unaudited condensed consolidated financial statements include the accounts of Evolving Systems, Inc. and subsidiaries, all of which are wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation. Revenue Recognition — 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 Financial Accounting Standards Board (“FASB”) Topic 606, Revenue from Contacts with Customers (“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. 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 standalone selling price. 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. We recognize revenue using the input method of accounting based on labor hours. ii. Customer Support Revenue Customer support services includes annual support fees, recurring maintenance fees, and minor product upgrades generally as a single performance obligation. 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 based on labor hours. These contracts generally include a single performance obligation. Under the input method, revenue is recognized 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 generally as a single performance obligation. On occasion, our managed services contracts will contain a specified number of hours to work over the term of the contract or other services that would be separate performance obligations. 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 Three Months Ended March 31, 2021 2020 Primary geographical markets United Kingdom $ 1,135 $ 1,190 Other 5,325 5,095 $ 6,460 $ 6,285 Major products/service lines License revenue $ 178 $ 207 Customer support, including warranty support fees 1,982 2,133 Services 2,056 1,567 Managed services 2,244 2,378 Total services 6,282 6,078 $ 6,460 $ 6,285 Timing of revenue recognition Products transferred at a point in time $ 169 $ 135 Products and services transferred over time 6,291 6,150 $ 6,460 $ 6,285 Contract balances The following table provides information about receivables, assets, and liabilities from contracts with customers (in thousands): March 31, 2021 December 31, 2020 Assets Contract receivables, net $ 4,741 $ 5,681 Unbilled work-in-progress, net $ 3,593 $ 3,365 Liabilities Unearned revenue $ 5,043 $ 3,713 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. Management expects that incremental commission fees paid to employees and intermediaries as a result of obtaining contracts are recoverable and therefore the Company capitalized them as contract costs in the amount of $0.2 million at each of March 31, 202 1 and December 31, 2020 . Capitalized commission fees are amortized based on the transfer of services to which the assets relate which may range from two to three years and are included in sales and marketing. In each of the three month periods ended March 31, 20 21 and 2020 , the amount of amortization was less than $0.1 million and there was no impairment loss in relation to the costs capitalized. Applying the practical expedient in ASC 606 paragraph 340-40-25-4, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. These costs are included in sales and marketing. The contract liabilities primarily relate to unearned revenue. Amounts billed in advance of performance obligations being satisfied are recognized as unearned revenue. For the three months ended March 31, 2021 and 20 20, we recognized revenue of $1.9 million and $2.2 million, respectively, which was included in the corresponding contract liability balance at the beginning of the period. Transaction price allocated to the remaining performance obligations Remaining performance obligations represent the transaction price of firm orders for which work has not been completed 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 March 31, 20 21, the aggregate amount of the transaction price allocated to remaining performance obligations with lives greater than one-year totaled $16.9 million. The Company expects approximately 62% of remaining performance obligations to be recognized into revenue within the next twelve months, with the remaining 38% 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. Stock-based Compensation — We account for stock-based compensation by applying a fair-value-based measurement method to account for stock-based payment transactions with employees, non-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. We recognize forfeitures as they occur rather than estimating them at the time of the grant. Income Taxes — We record deferred tax assets and liabilities for the estimated future tax effects of temporary differences between the tax bases of assets and liabilities and amounts reported in the accompanying condensed consolidated balance sheets, as well as operating losses and tax credit carry-forwards. We measure deferred tax assets and liabilities using enacted tax rates expected to be applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. We reduce deferred tax assets by a valuation allowance if, based on available evidence, it is more likely than not that these benefits will not be realized. We use a recognition threshold and a measurement attribute for 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. These chief operating decision makers review revenues by segment and review overall results of operations. We currently operate our business as one operating segment which includes two revenue types: license fees revenue and services revenue (as shown on the condensed consolidated statements of operations). 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 services, 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 December 2019, the FASB issued Accounting Standards Update (“ASU”) ASU 2019-12, Income Taxes (ASC 740) — Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 modifies ASC 740 to simplify the accounting for income taxes and eliminates certain exceptions to the general principles in ASC 740. The ASU removes certain exceptions for recognizing deferred taxes for investments, performing the incremental approach for intra-period allocation where there is a loss from continuing operations, and income or a gain from other items, and the general methodology for calculating income taxes in interim periods when a year-to-date loss exceeds the anticipated loss for the year. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill, reporting the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the first interim period that includes the enactment date, and allocating taxes to members of a consolidated group. ASU 2019-12 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2020. The amendments in this ASU did not have a material impact on our condensed consolidated financial statements . Management has evaluated other recently issued accounting pronouncements and does not believe that any of these pronouncements will have a significant impact on our condensed consolidated financial statements and related disclosures. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2021 | |
Intangible Assets [Abstract] | |
Intangible Assets | NOTE 2 — INTANGIBLE ASSETS We amortize identifiable intangible assets on a straight-line basis over their estimated useful lives. As of March 31 , 2021, and December 31, 20 20, identifiable intangibles were as follows (in thousands): March 31, 2021 Gross Amount Accumulated Amortization Net Carrying Amount Purchased software $ 2,940 $ (2,008) $ 932 Trademarks and tradenames 312 (279) 33 Non-competition 40 (40) — Customer relationships 4,409 (2,830) 1,579 $ 7,701 (1) $ (5,157) (1) $ 2,544 December 31, 2020 Gross Amount Accumulated Amortization Net Carrying Amount Purchased software $ 2,932 $ (1,907) $ 1,025 Trademarks and tradenames 311 (272) 39 Non-competition 40 (40) — Customer relationships 4,396 (2,691) 1,705 $ 7,679 (1) $ (4,910) (1) $ 2,769 (1) Includes foreign currency translation adjustment of less than $0.1 million. Amortization expense of identifiable intangible assets was $0.2 million for each of the three months ende d March 31, 2021 and 2020, respectively . Expected future amortization expense related to identifiable intangibles based on our carrying amount as of March 31, 2021 for the following five years is as follows (in thousands): For the trailing twelve months ending March 31, 2022 $ 923 2023 645 2024 324 2025 142 2026 94 Thereafter 416 $ 2,544 |
Balance Sheet Components
Balance Sheet Components | 3 Months Ended |
Mar. 31, 2021 | |
Balance Sheet Components [Abstract] | |
Balance Sheet Components | NOTE 3 — BALANCE SHEET COMPONENTS The components of accounts payable and accrued liabilities are as follows (in thousands): March 31, 2021 December 31, 2020 Accounts payable and accrued liabilities: Accounts payable $ 814 $ 878 Accrued compensation and related expenses 2,024 2,180 Accrued liabilities 1,657 1,247 $ 4,495 $ 4,305 |
Loss Per Share
Loss Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Loss Per Share [Abstract] | |
Loss Per Share | NOTE 4 — LOSS PER SHARE Basic loss per share is computed by dividing 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 loss 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 loss per share computations (in thousands except per share data): For the Three Months Ended March 31, 2021 2020 Basic loss per common share: Net loss $ (916) $ (32) Basic weighted average shares outstanding 12,206 12,164 Basic loss per common share: $ (0.08) $ (0.00) Diluted loss per common share: Net loss $ (916) $ (32) Weighted average shares outstanding 12,206 12,164 Effect of dilutive securities - options and restricted stock — — Diluted weighted average shares outstanding 12,206 12,164 Diluted loss per common share: $ (0.08) $ (0.00) Weighted average options to purchase of approximately 0.3 million shares and 0.4 million shares of common stock equivalents were excluded from the computation of diluted weighted average shares outstanding for the three months ended March 31, 2021, and 2020, 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. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2021 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | NOTE 5 — STOCK-BASED COMPENSATION We recogn ized $0.2 million and less than $0.1 million of compensation expense in the condensed consolidated statements of operations, with respect to our stock-based compensation plans for each of the three months ended March 31, 20 21 and 20 20 , respectively. The following table summarizes stock-based compensation expenses recorded in the condensed consolidated statements of operations (in thousands): For the Three Months Ended March 31, 2021 2020 Cost of revenue, excluding depreciation and amortization $ 12 $ 12 Sales and marketing 6 6 General and administrative 177 46 Product development 2 (6) Total stock-based compensation $ 197 $ 58 Stock Incentive Plans At March 31, 2021 and December 31, 20 20, no shares were available for grant under the 2007 Stock Plan, as amended. At March 31, 2021 and December 31, 2020, 0.2 million options and restricted shares were issued and outstanding under the 2007 Stock Plan as amended, respectively. At March 31, 2021 and December 31, 2020, there were approximately 0.5 million shares available for grant under the 2016 Stock Plan, respectively. At March 31, 2021 and December 31, 2020, 0.2 million options and restricted shares were issued and outstanding under the 2016 Stock Plan, respectively. The fair value of restricted shares for stock-based compensation expensing is equal to the closing price of our common stock on the date of grant. The restrictions for stock awards generally vest over four years for senior management and over one year for the board of directors. The following is a summary of restricted stock activity under the plans for the three months ended Mach 31, 2021: Restricted Stock Number of Shares (in thousands) Unvested restricted stock at January 1, 2021 63 Less restricted stock vested (31) Unvested restricted stock at March 31, 2021 32 The following is a summary of stock option activity under the plans for the three months ended March 31 , 2021: Weighted- Average Weighted- Remaining Aggregate Number of Average Contractual Intrinsic Shares Exercise Term Value (in thousands) Price (Years) (in thousands) Options outstanding at January 1, 2021 343 $ 5.82 5.62 $ — Less options forfeited/cancelled (5) 2.25 Options outstanding at March 31, 2021 338 $ 5.87 5.34 $ — Options exercisable at March 31, 2021 301 $ 6.04 5.18 $ — There were no stock options granted during the three months ended March 31, 2021 or 20 20. The total fair value of stock options and restricted stock vested during each of three months ended Ma r ch 31, 2021 and 2020 was $0.2 million, respectively. |
Concentration Of Credit Risk
Concentration Of Credit Risk | 3 Months Ended |
Mar. 31, 2021 | |
Concentration Of Credit Risk [Abstract] | |
Concentration Of Credit Risk | NOTE 6 — CONCENTRATION OF CREDIT RISK For the three months ended March 31, 2021 and 2020, we had one significant customer that accounted for 10% of revenue from operations, this significant customer is a large telecommunications operator in Europe. As of March 31, 2021 and December 31, 2020, no customers that accounted for 10% of contract receivables and unbilled work-in-progress . |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2021 | |
Long-Term Debt [Abstract] | |
Long-Term Debt | NOTE 7 — 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 “Lumata Facility”). The Lumata 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% . We used the full amount of the Lumata Facility to fund the acquisition of the Lumata companies. The Lumata 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. Lumata France SAS and Lumata UK Ltd are also bound to adhere to the finance documents as additional obligors. The Lumata Facility required 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 Lumata 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 Lumata 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. On September 24, 2019 the Company agreed in principle to the terms of a new amendment and on October 4, 2019, we entered into the First Amendment (“First Amendment”) to the Lumata Facility. The purpose of the First Amendment was to waive certain events of non-compliance with respect to covenants not achieved in prior periods and to amend future covenant requirements. The First Amendment also required Evolving Systems to make an advance payment of principal of $666,666.66 . The remaining terms and conditions of the Lumata Facility and payment schedule remain unchanged. The Company also agreed to pay East West Bank’s legal fees in connection with the transaction. Financial covenants previously included in the credit facilities were amended and replaced by a minimum consolidated cash balance of no less than the total bank debt outstanding and a minimum trailing three month consolidated EBITDA fixed dollar amount mutually agreed to by the Company and East West Bank in the amendments. On July 1, 2020, we entered into the Amendment and Waiver Letter (“Second Amendment”) to the Lumata Facility. The purpose of the Second Amendment was to waive certain events of non-compliance with respect to covenants not achieved in prior periods and to amend future covenant requirements. Financial covenants previously included in the amended credit facilities had been replaced by a monthly minimum consolidated cash balance of no less than $1.5 million and a fiscal quarter consolidated EBITDA fixed dollar amount mutually agreed to by the Company and East West Bank in the amendments. The Company also agreed to pay East West Bank’s legal fees in connection with the transaction. The Second Amendment adjusted the loan amortization accelerating the final payment date and fixed the interest rate at 5% on the remaining principal. The remaining terms and conditions of the Lumata Facility unchanged. Monthly payments were $0.1 million, and the Company also made an advance payment of $44,000 on June 1, 2020. The last payment was transacted on January 11, 2021. Paycheck Protection Program Loan On April 15, 2020, the Company received loan proceeds in the amount of $318,900 under the Paycheck Protection Program (“PPP”). The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), provides for loans to qualifying businesses for amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business. The loans and accrued interest are forgivable after a period of eight to twenty-four weeks as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels. The amount of loan forgiveness will be reduced if the borrower terminates employees or reduces salaries during the eight-week period. The unforgiven portion of the PPP loan is payable over two years at an interest rate of 1% , with a deferral of payments until the Small Business Association remits the loan forgiveness amount to the lender, however if the borrower does not apply for forgiveness the deferral shall be 10 months after the end of the loan forgiveness covered period. The Company intends to use the proceeds for purposes consistent with the PPP, Company wages. While the Company currently believes that its use of the loan proceeds will meet the conditions for forgiveness of the loan, we cannot assure you that we will not take actions that could cause the Company to be ineligible for forgiveness of the loan, in whole or in part. We have applied for forgiveness, but at this time there has not been any determination. Any such portion not forgiven can be prepaid in whole or part without penalty. We have recorded the PPP loan as a long term loan payable on our Condensed Consolidated Balance Sheet and will reduce the balance at the time loan is forgiven or we begin to make payments. This loan is due in one payment of principal of any unforgiven amount up to the full amount of $0.3 million, and accrued interest at maturity date in April of 2022. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Taxes [Abstract] | |
Income Taxes | NOTE 8 — INCOME TAXES The income tax provision for the fiscal year ending December 31, 2021 interim periods is determined using an estimate of the annual effective tax rate, adjusted for discrete items, primarily related to the effects o f foreign currency exchange realized transaction gains or losses and foreign taxes withheld . At March 31, 2021 the Company is currently estimating an annual effective tax rate of approximately 9.2% . For the three months ended March 31, 2021 discrete items resulted in a net tax expense effect of approximately $0.1 million. The Company’s recorded effective income tax rate was (9.0%) including effect of discrete items for the three months ended March 31, 2021. The Company recorded an income tax expense of $0.1 million and $0.2 million for the three months ended March 31, 2021 and 2020, respectively. Each quarter, the estimate of the annual effective tax rate is updated, and if the estimated effective tax rate changes, a cumulative adjustment is made. There is a potential for volatility of the effective tax rate due to various factors . The Company and its subsidiaries are subject to U.S. Federal income tax, as well as income tax of multiple state and foreign jurisdictions. As of March 31, 2021, the Company is subject to U.S. Federal income tax examinations for the years 2017 through 2019 and income tax examinations from various other jurisdictions for the years 2015 through 2019. 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 year 2018 and update each year subsequently, the Company finalized a transfer pricing plan with Evolving Systems and its subsidiaries. This transfer pricing plan determined the amount of income which is taxable in each respective jurisdiction. The Company applied this methodology in accordance with the transfer pricing plan and the adjustments necessary to reflect the reduction in U.S. pre-tax income resulted in an increase in domestic income before income tax expense of $1.1 million and a corresponding decrease in foreign income before income tax expense in the three months ended March 31, 2021 . |
Geographical Information
Geographical Information | 3 Months Ended |
Mar. 31, 2021 | |
Geographical Information [Abstract] | |
Geographical Information | NOTE 9 —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 U.K.-based subsidiaries. Additionally, personnel in Cluj -Napoca, Romania; Grenoble, France; and Bangalore and Kolkata, India; provide software development services and support to our global operations. Financial information relating to U.S. based companies and by international geographic region exceeding the threshold (defined as contributing at least 10%) of revenue from operations is as follows (in thousands): March 31, 2021 December 31, 2020 Long-lived assets, net United States $ 1,178 $ 1,352 United Kingdom 1,511 1,578 Other 1,570 1,286 $ 4,259 $ 4,216 |
Commitments And Contingencies
Commitments And Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | NOTE 10 — COMMITMENTS AND CONTINGENCIES (a) Lease Commitments Under Topic 842, operating lease expense is generally recognized evenly over the term of the lease. The Company has operating leases primarily consisting of facilities with remaining lease terms of one year to nine years. We lease office and operating facilities under non-cancelable operating leases. Current facility leases include our offices in Englewood, Colorado, New York, New York, London, England, Bangalore and Kolkata India, Johannesburg, South Africa, Kuala Lumpur, Malaysia, Échirolles, France, Cluj-Napoca, Romania and Madrid, Spain. The Compan y entered into one new nine year lease in Échirolles, France that contributed $0.3 million to our right-of-use asset/operating lease liability in the three months ended March 31, 2021. Total rent expense consisted of operating lease expense of $0.1 million and short-term lease expense of less than $0.1 million for each of the three months ended March 31, 2021 and 2020. There was no sublease rental income for the three months ended March 31, 2021 and 2020. We paid $0.1 million against Lease obligations — operating leases for each of the three months ended March 31, 2021 and 2020, respectively . Leases with an initial term of twelve months or less are not recorded on the condensed consolidated balance sheet. For lease agreements entered into or reassessed after the adoption of Topic 842, we combine the lease and non-lease components in determining the lease liabilities and right-of-use (“ROU”) assets. Our lease agreements generally do not provide an implicit borrowing rate; therefore, an internal incremental borrowing rate is determined based on information available at lease commencement date for purposes of determining the present value of lease payments. ROU lease assets and lease liabilities for our operating leases were recorded in the condensed consolidated balance sheet as follows (in thousands): As of March 31, 2021 Operating leases - right of use assets $ 1,203 Operating lease current $ 326 Lease obligations — operating leases, net of current portion 870 Total lease liability $ 1,196 Weighted average remaining lease term (in years) 4.9 Weighted average discount rate 6.09% Future lease payments included in the measurement of lease liabilities on the condensed consolidated balance sheet as of March 31, 2021 , for the following five fiscal years and thereafter were as follows (in thousands): For the year ending December 31, 2021 - Remaining $ 277 2022 354 2023 220 2024 122 2025 122 Thereafter 254 Total future minimum lease payments 1,349 Present value adjustment 153 Total $ 1,196 (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, there were no liabilities recorded for these agreements as of March 31, 2021 or December 31, 20 20. We enter into standard indemnification terms with customers and suppliers, in the ordinary course of business, for third party claims arising under our contracts. In addition, as we may subcontract the development of deliverables under customer contracts, we could be required to indemnify customers for work performed by subcontractors. Depending upon the nature of the indemnification, the potential amount of future payments we could be required to make under these indemnification agreements may be unlimited. We may be able to recover damages from a subcontractor or other supplier if the indemnification results from the subcontractor’s or supplier’s failure to perform. To the extent we are unable to recover damages from a subcontractor or other supplier, we could be required to reimburse the indemnified party for the full amount. We have never incurred costs to defend lawsuits or settle claims relating to an indemnification. As a result, we believe the estimated fair value of these agreements is minimal. Accordingly, there were no liabilities recorded for these agreements as of March 31, 2021 or December 31, 2020. Our standard license agreements contain product warranties that the software will be free of material defects and will operate in accordance with the stated requirements for a limited period of time. The product warranty provisions require us to cure any defects through any reasonable means. We believe the estimated fair value of the product warranty provisions in the license agreements in place with our customers is minimal. Accordingly, there were no liabilities recorded for these product warranty provisions as of March 30, 2021 or December 31, 2020. Our software arrangements generally include a product indemnification provision whereby we will indemnify and defend a customer in actions brought against the customer for claims that our products infringe upon a copyright, trade secret, or valid patent of a third party. We have not historically incurred any significant costs related to product indemnification claims. Accordingly, there were no liabilities recorded for these indemnification provisions as of March 31, 2021 or December 31, 2020. (c) Litigation From time to time, we are involved in various legal matters arising in the normal course of business. On October 15, 2019, the Company’s former Chief Executive Officer filed a lawsuit in the Superior Court of New Jersey against us. That suit seeks $3.5 million for claims of lib e l, harm of lost employment opportunities, severance payments and benefits that he would have been entitled to receive had he been terminated without cause. The Company has engaged legal counsel through its insurance carrier and has begun discovery. While no settlement has been finalized, ongoing discussions are progressing. As such, we have recorded a contingent liability in the amount of $0.3 million as of March 31, 2021 , such amount is included in other expenses, in our unaudited statement of operations . |
Organization And Summary Of S_2
Organization And Summary Of Significant Accounting Policies (Policy) | 3 Months Ended |
Mar. 31, 2021 | |
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 . Acquisitions of BLS Limited (“EVOL BLS”), four Lumata Holdings subsidiaries, Lumata France SAS, Lumata Spain S.L., Lumata UK Ltd and Lumata Deutschland GmbH (collectively, “Lumata Entities”) in 2017, along with the acquisition of RateIntegration d/b/a Sixth Sense Media (“SSM”) in 2015, expanded our footprint in the digital marketing space. Each of these acquisitions had their own platform which we still maintain today. Through the extensive work of our product development team, we have launched the Evolution platform featuring the best of these legacy platforms on cutting edge technology. Evolution is used to operate the most innovative large-scale loyalty programs, as well as providing unique mechanics enabling gamification, optimization and personalization across a variety of channels. It enables our clients to engage with their customers at all stage of their lifecycle, providing interactive dialogue and smart recommendations through all available traditional and digital channels. The platform seamlessly integrates within the service provider’s IT infrastructure, either on-premise or on a private cloud. It can be operated or managed as a service depending on the market needs. As a supplier of real-time digital engagement solutions and services, we drive growth in customer acquisition and activation, extend customer lifetime and increase customer value and revenue in the converging mobile, entertainment, financial and retail services eco-system. Our platforms, together with our team of experienced industry experts, help service providers increase their customer lifetime value (“CLV”) over the course the customer lifecycle. Evolving Systems provides software solutions and services throughout the world. The COVID-19 global outbreak has caused instability and volatility in multiple markets where our clients conduct business. We have leveraged our ability to provide support remotely resulting in limited effect on our day-to-day operations. The inability to travel has delayed interactions with our clients on projects and in the traditional modes of sales development. We continually work with existing and new clients exploring new ways of using our products and services to enhance their business. On-going travel restrictions has caused the business to interact with clients in new ways and reduced certain costs. The long-term effects on how we conduct business in the future is still undetermined but we continue to evolve to meet client needs . We believe our current liquidity and funds from our ongoing operations will be sufficient to fund operations and meet the Company’s cash needs for future working capital and capital expenditure requirements for at least the next twelve months from the date of issuance of these condensed consolidated financial statements. In making this assessment, we considered our $4.3 million in cash and cash equivalents and our $5.1 million in working capital at March 31, 2021, along with our ability to generate positive cash flows from operations for the three months ended March 31, 2021 and year ended December 31, 2020. |
Interim Condensed Consolidated Financial Statements | Interim Condensed Consolidated Financial Statements — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and in conformity with the instructions to Form 10-Q and Article 8 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures included in these condensed consolidated financial statements are adequate to make the information presented not misleading. The condensed consolidated financial statements included in this document have been prepared on the same basis as the annual consolidated financial statements, and in our opinion reflect all adjustments, which include normal recurring adjustments necessary for a fair presentation in accordance with US GAAP and SEC regulations for interim financial statements. The results for the three months ended March 31, 2021 are not necessarily indicative of the results that we will have for any subsequent period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to those statements for the year ended December 31, 2020 included in our Annual Report on Form 10-K as filed with the SEC on March 17, 2021. |
Use Of Estimates | Use of Estimates — The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (US 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 condensed 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 reporting 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 condensed consolidated statements of operations are translated at the weighted average rate of exchange during the applicable period. The resulting unrealized cumulative translation adjustment is recorded as a component of accumulated other comprehensive loss in stockholders’ equity. Realized and unrealized transaction gains and losses generated by transactions denominated in a currency different from the functional currency of the applicable entity are recorded in other income (expense) in the period in which they occur. |
Principles Of Consolidation | Principles of Consolidation — The unaudited condensed consolidated financial statements include the accounts of Evolving Systems, Inc. and subsidiaries, all of which are wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation. |
Revenue Recognition | Revenue Recognition — 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 Financial Accounting Standards Board (“FASB”) Topic 606, Revenue from Contacts with Customers (“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. 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 standalone selling price. 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. We recognize revenue using the input method of accounting based on labor hours. ii. Customer Support Revenue Customer support services includes annual support fees, recurring maintenance fees, and minor product upgrades generally as a single performance obligation. 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 based on labor hours. These contracts generally include a single performance obligation. Under the input method, revenue is recognized 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 generally as a single performance obligation. On occasion, our managed services contracts will contain a specified number of hours to work over the term of the contract or other services that would be separate performance obligations. 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 Three Months Ended March 31, 2021 2020 Primary geographical markets United Kingdom $ 1,135 $ 1,190 Other 5,325 5,095 $ 6,460 $ 6,285 Major products/service lines License revenue $ 178 $ 207 Customer support, including warranty support fees 1,982 2,133 Services 2,056 1,567 Managed services 2,244 2,378 Total services 6,282 6,078 $ 6,460 $ 6,285 Timing of revenue recognition Products transferred at a point in time $ 169 $ 135 Products and services transferred over time 6,291 6,150 $ 6,460 $ 6,285 Contract balances The following table provides information about receivables, assets, and liabilities from contracts with customers (in thousands): March 31, 2021 December 31, 2020 Assets Contract receivables, net $ 4,741 $ 5,681 Unbilled work-in-progress, net $ 3,593 $ 3,365 Liabilities Unearned revenue $ 5,043 $ 3,713 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. Management expects that incremental commission fees paid to employees and intermediaries as a result of obtaining contracts are recoverable and therefore the Company capitalized them as contract costs in the amount of $0.2 million at each of March 31, 202 1 and December 31, 2020 . Capitalized commission fees are amortized based on the transfer of services to which the assets relate which may range from two to three years and are included in sales and marketing. In each of the three month periods ended March 31, 20 21 and 2020 , the amount of amortization was less than $0.1 million and there was no impairment loss in relation to the costs capitalized. Applying the practical expedient in ASC 606 paragraph 340-40-25-4, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. These costs are included in sales and marketing. The contract liabilities primarily relate to unearned revenue. Amounts billed in advance of performance obligations being satisfied are recognized as unearned revenue. For the three months ended March 31, 2021 and 20 20, we recognized revenue of $1.9 million and $2.2 million, respectively, which was included in the corresponding contract liability balance at the beginning of the period. Transaction price allocated to the remaining performance obligations Remaining performance obligations represent the transaction price of firm orders for which work has not been completed 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 March 31, 20 21, the aggregate amount of the transaction price allocated to remaining performance obligations with lives greater than one-year totaled $16.9 million. The Company expects approximately 62% of remaining performance obligations to be recognized into revenue within the next twelve months, with the remaining 38% 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. |
Stock-based Compensation | Stock-based Compensation — We account for stock-based compensation by applying a fair-value-based measurement method to account for stock-based payment transactions with employees, non-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. We recognize forfeitures as they occur rather than estimating them at the time of the grant. |
Income Taxes | Income Taxes — We record deferred tax assets and liabilities for the estimated future tax effects of temporary differences between the tax bases of assets and liabilities and amounts reported in the accompanying condensed consolidated balance sheets, as well as operating losses and tax credit carry-forwards. We measure deferred tax assets and liabilities using enacted tax rates expected to be applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. We reduce deferred tax assets by a valuation allowance if, based on available evidence, it is more likely than not that these benefits will not be realized. We use a recognition threshold and a measurement attribute for 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. These chief operating decision makers review revenues by segment and review overall results of operations. We currently operate our business as one operating segment which includes two revenue types: license fees revenue and services revenue (as shown on the condensed consolidated statements of operations). 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 services, 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 | Recently Adopted Accounting Pronouncements — In December 2019, the FASB issued Accounting Standards Update (“ASU”) ASU 2019-12, Income Taxes (ASC 740) — Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 modifies ASC 740 to simplify the accounting for income taxes and eliminates certain exceptions to the general principles in ASC 740. The ASU removes certain exceptions for recognizing deferred taxes for investments, performing the incremental approach for intra-period allocation where there is a loss from continuing operations, and income or a gain from other items, and the general methodology for calculating income taxes in interim periods when a year-to-date loss exceeds the anticipated loss for the year. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill, reporting the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the first interim period that includes the enactment date, and allocating taxes to members of a consolidated group. ASU 2019-12 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2020. The amendments in this ASU did not have a material impact on our condensed consolidated financial statements . Management has evaluated other recently issued accounting pronouncements and does not believe that any of these pronouncements will have a significant impact on our condensed consolidated financial statements and related disclosures. |
Organization And Summary Of S_3
Organization And Summary Of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Organization And Summary Of Significant Accounting Policies [Abstract] | |
Schedule Of Disaggregation Of Revenue | For the Three Months Ended March 31, 2021 2020 Primary geographical markets United Kingdom $ 1,135 $ 1,190 Other 5,325 5,095 $ 6,460 $ 6,285 Major products/service lines License revenue $ 178 $ 207 Customer support, including warranty support fees 1,982 2,133 Services 2,056 1,567 Managed services 2,244 2,378 Total services 6,282 6,078 $ 6,460 $ 6,285 Timing of revenue recognition Products transferred at a point in time $ 169 $ 135 Products and services transferred over time 6,291 6,150 $ 6,460 $ 6,285 |
Schedule Of Receivables, Assets And Liabilities From Contracts With Customers | March 31, 2021 December 31, 2020 Assets Contract receivables, net $ 4,741 $ 5,681 Unbilled work-in-progress, net $ 3,593 $ 3,365 Liabilities Unearned revenue $ 5,043 $ 3,713 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Intangible Assets [Abstract] | |
Summary Of Identifiable Intangible Assets | March 31, 2021 Gross Amount Accumulated Amortization Net Carrying Amount Purchased software $ 2,940 $ (2,008) $ 932 Trademarks and tradenames 312 (279) 33 Non-competition 40 (40) — Customer relationships 4,409 (2,830) 1,579 $ 7,701 (1) $ (5,157) (1) $ 2,544 December 31, 2020 Gross Amount Accumulated Amortization Net Carrying Amount Purchased software $ 2,932 $ (1,907) $ 1,025 Trademarks and tradenames 311 (272) 39 Non-competition 40 (40) — Customer relationships 4,396 (2,691) 1,705 $ 7,679 (1) $ (4,910) (1) $ 2,769 (1) Includes foreign currency translation adjustment of less than $0.1 million. |
Summary Of Expected Future Amortization Expense Related To Identifiable Intangibles | For the trailing twelve months ending March 31, 2022 $ 923 2023 645 2024 324 2025 142 2026 94 Thereafter 416 $ 2,544 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Balance Sheet Components [Abstract] | |
Accounts Payable And Accrued Liabilities | March 31, 2021 December 31, 2020 Accounts payable and accrued liabilities: Accounts payable $ 814 $ 878 Accrued compensation and related expenses 2,024 2,180 Accrued liabilities 1,657 1,247 $ 4,495 $ 4,305 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Loss Per Share [Abstract] | |
Summary Of Basic And Diluted Loss Per Share | For the Three Months Ended March 31, 2021 2020 Basic loss per common share: Net loss $ (916) $ (32) Basic weighted average shares outstanding 12,206 12,164 Basic loss per common share: $ (0.08) $ (0.00) Diluted loss per common share: Net loss $ (916) $ (32) Weighted average shares outstanding 12,206 12,164 Effect of dilutive securities - options and restricted stock — — Diluted weighted average shares outstanding 12,206 12,164 Diluted loss per common share: $ (0.08) $ (0.00) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Stock-Based Compensation [Abstract] | |
Summary Of Stock-Based Compensation Expenses | For the Three Months Ended March 31, 2021 2020 Cost of revenue, excluding depreciation and amortization $ 12 $ 12 Sales and marketing 6 6 General and administrative 177 46 Product development 2 (6) Total stock-based compensation $ 197 $ 58 |
Summary Of Restricted Stock Activity | Restricted Stock Number of Shares (in thousands) Unvested restricted stock at January 1, 2021 63 Less restricted stock vested (31) Unvested restricted stock at March 31, 2021 32 |
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 January 1, 2021 343 $ 5.82 5.62 $ — Less options forfeited/cancelled (5) 2.25 Options outstanding at March 31, 2021 338 $ 5.87 5.34 $ — Options exercisable at March 31, 2021 301 $ 6.04 5.18 $ — |
Geographical Information (Table
Geographical Information (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Geographical Information [Abstract] | |
Long-Lived Assets, Net By Geographic Region | March 31, 2021 December 31, 2020 Long-lived assets, net United States $ 1,178 $ 1,352 United Kingdom 1,511 1,578 Other 1,570 1,286 $ 4,259 $ 4,216 |
Commitments And Contingencies (
Commitments And Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Commitments And Contingencies [Abstract] | |
Operating ROU Lease Assets And Lease Liabilities | As of March 31, 2021 Operating leases - right of use assets $ 1,203 Operating lease current $ 326 Lease obligations — operating leases, net of current portion 870 Total lease liability $ 1,196 Weighted average remaining lease term (in years) 4.9 Weighted average discount rate 6.09% |
Future Lease Payments | For the year ending December 31, 2021 - Remaining $ 277 2022 354 2023 220 2024 122 2025 122 Thereafter 254 Total future minimum lease payments 1,349 Present value adjustment 153 Total $ 1,196 |
Organization And Summary Of S_4
Organization And Summary Of Significant Accounting Policies (Narrative) (Details) | 3 Months Ended | |||
Mar. 31, 2021USD ($)itemsegment | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Cash and cash equivalents | $ 4,292,000 | $ 2,606,000 | $ 2,763,000 | $ 3,076,000 |
Working capital | $ 5,100,000 | |||
Number of recognized sources for revenue | item | 2 | |||
Capitalized contract cost | $ 200,000 | $ 200,000 | ||
Capitalized contract cost, impairment loss | 0 | 0 | ||
Revenue recognized in corresponding to contract liability | 1,900,000 | 2,200,000 | ||
Remaining performance obligations | $ 16,900,000 | |||
Percentage of remaining performance obligations, next twelve months | 62.00% | |||
Number of operating segments | segment | 1 | |||
Minimum [Member] | ||||
Capitalized contract cost, amortization period | 2 years | |||
Maximum [Member] | ||||
Capitalized contract cost, amortization period | 3 years | |||
Capitalized contract cost, amortization | $ 100,000 | $ 100,000 | ||
Year 1 and 2 [Member] | ||||
Percentage of remaining performance obligations, thereafter | 38.00% |
Organization And Summary Of S_5
Organization And Summary Of Significant Accounting Policies (Schedule Of Disaggregation Of Revenue) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 6,460 | $ 6,285 |
Products Transferred At A Point In Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 169 | 135 |
Products and Services Transferred Over Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 6,291 | 6,150 |
License Fees [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 178 | 207 |
Customer Support [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 1,982 | 2,133 |
Services [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 2,056 | 1,567 |
Managed Services [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 2,244 | 2,378 |
Services [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 6,282 | 6,078 |
United Kingdom [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 1,135 | 1,190 |
Other [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 5,325 | $ 5,095 |
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 | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Contract receivables, net | $ 4,741 | $ 5,681 |
Unbilled work-in-progress, net | 3,593 | 3,365 |
Liabilities | ||
Unearned revenue | $ 5,043 | $ 3,713 |
Intangible Assets (Narrative) (
Intangible Assets (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Intangible Assets [Abstract] | ||
Amortization of intangible assets | $ 238 | $ 235 |
Intangible Assets (Summary Of I
Intangible Assets (Summary Of Identifiable Intangible Assets) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 7,701 | $ 7,679 |
Accumulated Amortization | (5,157) | (4,910) |
Net Carrying Amount | 2,544 | 2,769 |
Functional currency adjustment | 100 | 100 |
Purchased Software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 2,940 | 2,932 |
Accumulated Amortization | (2,008) | (1,907) |
Net Carrying Amount | 932 | 1,025 |
Trademarks And Tradenames [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 312 | 311 |
Accumulated Amortization | (279) | (272) |
Net Carrying Amount | 33 | 39 |
Non-competition [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 40 | 40 |
Accumulated Amortization | (40) | (40) |
Net Carrying Amount | ||
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 4,409 | 4,396 |
Accumulated Amortization | (2,830) | (2,691) |
Net Carrying Amount | $ 1,579 | $ 1,705 |
Intangible Assets (Summary Of E
Intangible Assets (Summary Of Expected Future Amortization Expense Related To Identifiable Intangibles) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
For the trailing twelve months ending March 31, | ||
2022 | $ 923 | |
2023 | 645 | |
2024 | 324 | |
2025 | 142 | |
2026 | 94 | |
Thereafter | 416 | |
Net Carrying Amount | $ 2,544 | $ 2,769 |
Balance Sheet Components (Accou
Balance Sheet Components (Accounts Payable And Accrued Liabilities) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Balance Sheet Components [Abstract] | ||
Accounts payable | $ 814 | $ 878 |
Accrued compensation and related expenses | 2,024 | 2,180 |
Accrued liabilities | 1,657 | 1,247 |
Total accounts payable and accrued liabilities | $ 4,495 | $ 4,305 |
Loss Per Share (Narrative) (Det
Loss Per Share (Narrative) (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Common Stock [Member] | ||
Shares excluded from the dilutive stock calculation | 0.3 | 0.4 |
Loss Per Share (Summary Of Basi
Loss Per Share (Summary Of Basic And Diluted Loss Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Basic loss per common share: | ||
Net loss | $ (916) | $ (32) |
Basic weighted average shares outstanding | 12,206 | 12,164 |
Basic loss per common share: | $ (0.08) | $ 0 |
Diluted loss per common share: | ||
Net loss | $ (916) | $ (32) |
Weighted average shares outstanding | 12,206 | 12,164 |
Effect of dilutive securities - options and restricted stock | ||
Diluted weighted average shares outstanding | 12,206 | 12,164 |
Diluted loss per common share: | $ (0.08) | $ 0 |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 197 | $ 58 | |
Stock options granted | 0 | 0 | |
Fair value of stock awards vested | $ 200 | $ 200 | |
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 | 200,000 | 200,000 | |
2016 Stock Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares available for grant | 500,000 | 500,000 | |
Shares issued and outstanding | 200,000 | 200,000 | |
Senior Management [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
Board Members [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year |
Stock-Based Compensation (Summa
Stock-Based Compensation (Summary Of Stock-Based Compensation Expenses) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation | $ 197 | $ 58 |
Cost Of Revenue, Excluding Depreciation And Amortization [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation | 12 | 12 |
Sales And Marketing [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation | 6 | 6 |
General And Administrative [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation | 177 | 46 |
Product Development [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation | $ 2 | $ (6) |
Stock-Based Compensation (Sum_2
Stock-Based Compensation (Summary Of Restricted Stock Activity) (Details) - Restricted Stock [Member] shares in Thousands | 3 Months Ended |
Mar. 31, 2021shares | |
Unvested restricted stock, beginning | 63 |
Less restricted stock vested | (31) |
Unvested restricted stock, ending | 32 |
Stock-Based Compensation (Sum_3
Stock-Based Compensation (Summary Of Stock Option Activity) (Details) - USD ($) shares in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Stock-Based Compensation [Abstract] | ||
Number of Shares, Options outstanding at beginning | 343 | |
Number of Shares, Less options forfeited/cancelled | (5) | |
Number of Shares, Options outstanding at ending | 338 | 343 |
Number of Shares, Options exercisable at March 31, 2021 | 301 | |
Weighted-Average Exercise Price, Options outstanding at beginning | $ 5.82 | |
Weighted-Average Exercise Price, Less options forfeited/cancelled | 2.25 | |
Weighted-Average Exercise Price, Options outstanding at ending | 5.87 | $ 5.82 |
Weighted-Average Exercise Price, Options exercisable at March 31, 2021 | $ 6.04 | |
Weighted-Average Remaining Contractual Term (Years), Options outstanding | 5 years 4 months 2 days | 5 years 7 months 13 days |
Weighted-Average Remaining Contractual Term (Years), Options exercisable at March 31, 2021 | 5 years 2 months 5 days | |
Aggregate Intrinsic Value, Options outstanding at beginning | ||
Aggregate Intrinsic Value, Options outstanding at ending | ||
Aggregate Intrinsic Value, Options exercisable at March 31, 2021 |
Concentration Of Credit Risk (N
Concentration Of Credit Risk (Narrative) (Details) - customer | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Revenue [Member] | Customer One [Member] | Europe [Member] | |||
Concentration Risk [Line Items] | |||
Number of significant customers | 1 | 1 | |
Concentration risk, percentage | 10.00% | 10.00% | |
Contract Receivables And Unbilled Work-In-Progress [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Number of significant customers | 0 | 0 | |
Concentration risk, percentage | 10.00% | 10.00% |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) | Jun. 01, 2020USD ($) | Apr. 15, 2020USD ($) | Jul. 31, 2018USD ($) | Aug. 16, 2017USD ($)item | Mar. 31, 2021USD ($) | Jul. 01, 2020USD ($) | Oct. 04, 2019USD ($) |
Lumata Facility [Member] | East West Bank [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Loan amount | $ 4,700,000 | ||||||
Monthly principal payment | $ 100,000 | ||||||
Interest rate | 1.50% | ||||||
Number of monthly installments of principal | item | 4 | ||||||
Origination fee | $ 23,650 | ||||||
Increment amount | $ 50,000 | ||||||
Prepayment fee percentage | 2.00% | ||||||
Lumata Facility - Second Amendment [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Monthly minimum consolidated cash balance | $ 1,500,000 | ||||||
Monthly principal payment | $ 100,000 | ||||||
Interest rate | 5.00% | ||||||
Advance payment | $ 44,000 | ||||||
Loan Facility - First Amendment [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Advance payment | $ 666,666.66 | ||||||
Paycheck Protection Program Loan [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Proceeds from PPP loan | $ 318,900 | ||||||
Payable period, unforgiven portion | 2 years | ||||||
Interest rate | 1.00% | ||||||
Deferral payments period | 10 months | ||||||
Minimum [Member] | Lumata Facility [Member] | East West Bank [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate | 3.50% | ||||||
Prepayment amount | $ 250,000 | ||||||
Minimum [Member] | Paycheck Protection Program Loan [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Loans and accrued interest, forgivable period | 56 days | ||||||
Maximum [Member] | Paycheck Protection Program Loan [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Loans and accrued interest, forgivable period | 168 days | ||||||
Payment of principal of any unforgiven amount up to | $ 300,000 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Taxes [Abstract] | ||
Annual effective tax rate | 9.20% | |
Effective income tax rate | (9.00%) | |
Net income tax expense | $ 75 | $ 199 |
Income before income tax expense | $ 1,100 |
Geographical Information (Long-
Geographical Information (Long-Lived Assets, Net By Geographic Region) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | $ 4,259 | $ 4,216 |
United States [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | 1,178 | 1,352 |
United Kingdom [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | 1,511 | 1,578 |
Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | $ 1,570 | $ 1,286 |
Commitments And Contingencies_2
Commitments And Contingencies (Narrative) (Details) | Oct. 15, 2019USD ($) | Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($)item |
Other Commitments [Line Items] | ||||
Operating lease right of use assets | $ 1,203,000 | $ 915,000 | ||
Operating lease liability | 1,196,000 | |||
Operating lease expense | 100,000 | $ 100,000 | ||
Short-term lease expense | 100,000 | 100,000 | ||
Sublease rental income | 0 | 0 | ||
Lease obligations - operating leases | 100,000 | $ 100,000 | ||
Litigation, amount seeking | $ 3,500,000 | |||
Contingent liability | $ 300,000 | |||
Minimum [Member] | ||||
Other Commitments [Line Items] | ||||
Remaining lease terms | 1 year | |||
Maximum [Member] | ||||
Other Commitments [Line Items] | ||||
Remaining lease terms | 9 years | |||
Product Warranty [Member] | ||||
Other Commitments [Line Items] | ||||
Liabilities | $ 0 | 0 | ||
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] | Software [Member] | ||||
Other Commitments [Line Items] | ||||
Liabilities | $ 0 | $ 0 | ||
Echirolles, France [Member] | ||||
Other Commitments [Line Items] | ||||
Lease term | 9 years | |||
Number of new leases | item | 1 | |||
Operating lease right of use assets | $ 300,000 | |||
Operating lease liability | $ 300,000 |
Commitments And Contingencies_3
Commitments And Contingencies (Operating ROU Lease Assets And Lease Liabilities) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Commitments And Contingencies [Abstract] | ||
Operating leases - right of use assets, net | $ 1,203 | $ 915 |
Operating lease current | 326 | 294 |
Lease obligations - operating leases, net of current portion | 870 | $ 613 |
Total lease liability | $ 1,196 | |
Weighted average remaining lease term (in years) | 4 years 10 months 24 days | |
Weighted average discount rate | 6.09% |
Commitments And Contingencies_4
Commitments And Contingencies (Future Lease Payments) (Details) $ in Thousands | Mar. 31, 2021USD ($) |
Commitments And Contingencies [Abstract] | |
2021 - Remaining | $ 277 |
2022 | 354 |
2023 | 220 |
2024 | 122 |
2025 | 122 |
Thereafter | 254 |
Total future minimum lease payments | 1,349 |
Present value adjustment | 153 |
Total | $ 1,196 |