Bsquare (BSQR) 10-Q 3 Aug 16 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2016	Jul. 29, 2016
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2016
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q2
Trading Symbol	BSQR
Entity Registrant Name	BSQUARE CORP /WA
Entity Central Index Key	1,054,721
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		12,262,698

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 10,619	$ 16,443
Short-term investments	16,279	13,280
Accounts receivable, net of allowance for doubtful accounts of $62 at June 30, 2016 and December 31, 2015	19,377	19,009
Prepaid expenses and other current assets	784	580
Total current assets	47,059	49,312
Equipment, furniture and leasehold improvements, net	1,037	1,167
Restricted cash equivalents	250	250
Deferred tax assets	17	145
Intangible assets, net	526	594
Goodwill	3,738	3,738
Other non-current assets	53	52
Total assets	52,680	55,258
Current liabilities:
Third-party software fees payable	8,403	11,789
Accounts payable	328	188
Accrued compensation	2,093	2,390
Other accrued expenses	1,715	1,277
Deferred rent, current portion	309	298
Deferred revenue	559	1,135
Total current liabilities	13,407	17,077
Deferred tax liability	87	97
Deferred rent	1,020	1,177
Shareholders’ equity:
Preferred stock, no par value: 10,000,000 shares authorized; no shares issued and outstanding
Common stock, no par value: 37,500,000 shares authorized; 12,243,330 shares issued and outstanding at June 30, 2016 and 12,092,598 shares issued and outstanding at December 31, 2015	134,264	133,331
Accumulated other comprehensive loss	(858)	(869)
Accumulated deficit	(95,240)	(95,555)
Total shareholders’ equity	38,166	36,907
Total liabilities and shareholders’ equity	$ 52,680	$ 55,258

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Statement Of Financial Position [Abstract]
Allowance for doubtful accounts receivable	$ 62	$ 62
Preferred stock, par value
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value
Common stock, shares authorized	37,500,000	37,500,000
Common stock, shares issued	12,243,330	12,092,598
Common stock, shares outstanding	12,243,330	12,092,598

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Revenue:
Software	$ 18,735	$ 23,676	$ 38,902	$ 45,464
Service	4,003	5,197	9,275	9,674
Total revenue	22,738	28,873	48,177	55,138
Cost of revenue:
Software	15,459	19,956	32,620	37,034
Service	3,386	3,685	7,368	7,423
Total cost of revenue	18,845	23,641	39,988	44,457
Gross profit	3,893	5,232	8,189	10,681
Operating expenses:
Selling, general and administrative	3,204	2,939	6,410	5,946
Research and development	774	422	1,215	988
Total operating expenses	3,978	3,361	7,625	6,934
Income (loss) from operations	(85)	1,871	564	3,747
Other income, net	55	68	76	92
Income (loss) before income taxes	(30)	1,939	640	3,839
Income tax expense	(155)	(54)	(325)	(131)
Net income (loss)	$ (185)	$ 1,885	$ 315	$ 3,708
Basic income (loss) per share	$ (0.02)	$ 0.16	$ 0.03	$ 0.31
Diluted income (loss) per share	$ (0.02)	$ 0.15	$ 0.03	$ 0.30
Shares used in calculation of income (loss) per share:
Basic	12,152	11,856	12,127	11,826
Diluted	12,152	12,295	12,559	12,195
Comprehensive income (loss):
Net income (loss)	$ (185)	$ 1,885	$ 315	$ 3,708
Other comprehensive income (loss):
Foreign currency translation, net of tax	13	88	34	14
Change in unrealized gains (losses) on investments, net of tax	2	2	(23)	(4)
Total other comprehensive income (loss)	15	90	11	10
Comprehensive income (loss)	$ (170)	$ 1,975	$ 326	$ 3,718

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Net income	$ 315	$ 3,708
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	303	288
Stock-based compensation	628	569
Changes in operating assets and liabilities:
Accounts receivable, net	(368)	(1,792)
Prepaid expenses and other assets	(87)	17
Third-party software fees payable	(3,386)	114
Accounts payable and accrued expenses	281	54
Deferred revenue	(576)	(78)
Deferred rent	(146)	(132)
Net cash provided by (used in) operating activities	(3,036)	2,748
Cash flows from investing activities:
Purchases of equipment and furniture	(105)	(44)
Proceeds from maturities of short-term investments	12,950	9,481
Purchases of short-term investments	(15,926)	(13,678)
Net cash used for investing activities	(3,081)	(4,241)
Cash flows from financing activities:
Proceeds from exercise of stock options	333	322
Effect of exchange rate changes on cash	(40)	10
Net decrease in cash and cash equivalents	(5,824)	(1,161)
Cash and cash equivalents, beginning of period	16,443	13,127
Cash and cash equivalents, end of period	$ 10,619	$ 11,966

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2016
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	1. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements of BSQUARE Corporation (“BSQUARE”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting and include the accounts of BSQUARE and our wholly owned subsidiaries. Certain information and footnote disclosures normally included in the annual consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. In our opinion, the unaudited condensed consolidated financial statements include all material adjustments, all of which are of a normal and recurring nature, necessary to present fairly our financial position as of June 30, 2016, our operating results for the three and six months ended June 30, 2016 and 2015 and our cash flows for the six months ended June 30, 2016 and 2015. The accompanying financial information as of December 31, 2015 is derived from audited financial statements. Preparing financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Examples include provisions for bad debts and income taxes, estimates of progress on professional engineering service arrangements and bonus accruals. Actual results may differ from these estimates. Interim results are not necessarily indicative of results for a full year. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2015. All intercompany balances have been eliminated. Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers,” amending revenue recognition guidance and requiring more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The guidance, as amended, is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted for public companies effective for annual and interim reporting periods beginning after December 15, 2016. We are currently evaluating the impact this ASU will have on our consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17, “Balance Sheet Classification of Deferred Taxes,” to simplify the presentation of deferred income taxes. The amendments in this ASU require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The amendments in this ASU apply to all entities that present a classified statement of financial position. The current requirement that deferred tax liabilities and assets of a tax-paying component of an entity be offset and presented as a single amount is not affected by the amendments in this ASU. We adopted the new guidance retrospectively beginning with the year ended December 31, 2014, and applied such guidance consistently for the year ended December 31, 2015. In February 2016, the FASB issued ASU No. 2016-2, “Leases,” to make leasing activities more transparent and comparable, requiring most leases be recognized by lessees on their balance sheets as right-of-use assets, along with corresponding lease liabilities. ASU 2016-2 is effective for public business entities for annual periods beginning after December 31, 2018 and interim periods within that year, with early adoption permitted. We are currently evaluating the impact this ASU may have on our consolidated financial statements and related disclosures. In March 2016, the FASB amended the existing accounting standards for stock-based compensation, ASU 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting Income (Loss) Per Share Basic income (loss) per share is computed using the weighted average number of common shares outstanding during the period, and excludes any dilutive effects of common stock equivalent shares, such as options, restricted stock awards and restricted stock units. Restricted stock awards (“RSAs”) are considered outstanding and included in the computation of basic income or loss per share when underlying restrictions expire and the awards are no longer forfeitable. Restricted stock units (“RSUs”) are considered outstanding and included in the computation of basic income or loss per share only when vested. Diluted income (loss) per share is computed using the weighted average number of common shares outstanding and common stock equivalent shares outstanding during the period using the treasury stock method. Common stock equivalent shares are excluded from the computation if their effect is anti-dilutive. We excluded an aggregate of 1,864,147 and 654,441 options for the three and six months ended June 30, 2016, respectively, from diluted earnings per share because their effect was anti-dilutive. For the three months ended June 30, 2016, this included common stock equivalent shares of 1,188,189 calculated using the treasury stock method that would have been included in diluted earnings per share had we been in a net income position. In a period where we are in a loss position, diluted loss per share is computed using the basic share count. We excluded an aggregate of 114,270 and 130,159 options for the three and six months ended June 30, 2015, respectively, from diluted earnings per share because their effect was anti-dilutive.

Cash, Cash Equivalents and Inve

Cash, Cash Equivalents and Investments	6 Months Ended
	Jun. 30, 2016
Cash And Cash Equivalents [Abstract]
Cash, Cash Equivalents and Investments	2. Cash, Cash Equivalents and Investments Cash, cash equivalents and short-term investments consisted of the following (in thousands): June 30, 2016 December 31, 2015 Cash $ 8,583 $ 7,270 Cash equivalents: Money market funds 1,536 1,500 Corporate commercial paper 500 5,404 Corporate debt securities — 2,269 Total cash equivalents 2,036 9,173 Total cash and cash equivalents 10,619 16,443 Short-term investments: Corporate commercial paper 10,990 6,245 Treasury bonds — 1,007 Corporate debt securities 5,289 6,028 Total short-term investments 16,279 13,280 Restricted cash equivalents—money market fund 250 250 Total cash, cash equivalents and short-term investments $ 27,148 $ 29,973 Gross unrealized gains and losses on our short-term investments were not material as of June 30, 2016 and December 31, 2015. The balances in restricted cash equivalents relate to a letter of credit securing the lease of our corporate headquarters.

Fair Value Measurements

Fair Value Measurements	6 Months Ended
	Jun. 30, 2016
Fair Value Disclosures [Abstract]
Fair Value Measurements	3. Fair Value Measurements We measure our cash equivalents and short-term investments at fair value. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value: Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Directly or indirectly observable market-based inputs or unobservable inputs used in models or other valuation methodologies. Level 3: Unobservable inputs that are not corroborated by market data. The inputs require significant management judgment or estimation. We classify our cash equivalents and short-term investments within Level 1 or Level 2 because our cash equivalents and short-term investments are valued using quoted market prices or alternative pricing sources and models utilizing market observable inputs. Assets and liabilities measured at fair value on a recurring basis as of June 30, 2016 and December 31, 2015 are summarized below (in thousands): June 30, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1) Direct or Indirect Observable Inputs (Level 2) Total Assets Cash equivalents: Money market funds $ 1,536 $ — $ 1,536 Corporate commercial paper — 500 500 Corporate debt securities — — — Total cash equivalents 1,536 500 2,036 Short-term investments: Corporate commercial paper — 10,990 10,990 Treasury bonds — — — Corporate debt securities — 5,289 5,289 Total short-term investments — 16,279 16,279 Restricted cash equivalents—money market fund 250 — 250 Total assets measured at fair value $ 1,786 $ 16,779 $ 18,565 December 31, 2015 Quoted Prices in Active Markets for Identical Assets (Level 1) Direct or Indirect Observable Inputs (Level 2) Total Assets Cash equivalents: Money market funds $ 5,404 $ — $ 5,404 Corporate commercial paper — 1,500 1,500 Corporate debt securities — 2,269 2,269 Total cash equivalents 5,404 3,769 9,173 Short-term investments: Corporate commercial paper — 6,245 6,245 Treasury bonds — 1,007 1,007 Corporate debt securities — 6,028 6,028 Total short-term investments — 13,280 13,280 Restricted cash equivalents—money market fund 250 — 250 Total assets measured at fair value $ 5,654 $ 17,049 $ 22,703

Goodwill and Intangible Assets

Goodwill and Intangible Assets	6 Months Ended
	Jun. 30, 2016
Goodwill And Intangible Assets Disclosure [Abstract]
Goodwill and Intangible Assets	4. Goodwill and Intangible Assets Goodwill relates to the 2011 acquisition of MPC Data, Ltd. (renamed BSQUARE EMEA in 2015), a United Kingdom based provider of embedded software engineering services. The excess of the acquisition consideration over the fair value of net assets acquired was recorded as goodwill. We operate as a single reporting unit, and BSQUARE EMEA falls within that reporting unit. There were no changes in the carrying amount of goodwill during the three and six months ended June 30, 2016. Intangible assets relate to customer relationships acquired from TestQuest Inc. in 2008 and from the acquisition of MPC in 2011, the vast majority of which relates to the MPC acquisition. Information regarding our intangible assets is as follows (in thousands): June 30, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Value Customer relationships $ 1,275 $ (749 ) $ 526 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Carrying Value Customer relationships $ 1,275 $ (681 ) $ 594 Amortization expense was $34,000 and $68,000 for the three and six months ended June 30, 2016, respectively, and $34,000 and $68,000 for the three and six months ended June 30, 2015, respectively. Amortization in future periods is expected to be as follows (in thousands): Remainder of 2016 $ 63 2017 98 2018 98 2019 98 2020 98 2021 71 Total $ 526

Credit Agreement

Credit Agreement	6 Months Ended
	Jun. 30, 2016
Debt Disclosure [Abstract]
Credit Agreement	5. Credit Agreement Line of Credit On September 22, 2015, we entered into a two-year unsecured line of credit agreement (the “Credit Agreement”) with JPMorgan Chase Bank, N.A. (the “Bank”) in the principal amount of up to $12 million. At our election, advances under the Credit Agreement shall bear interest at either (1) a rate per annum equal to 1.5% below the bank’s applicable prime rate or (2) 1.5% above the Bank’s applicable LIBOR rate, in each case as defined in the Credit Agreement. The Credit Agreement contains customary affirmative and negative covenants, including compliance with financial ratios and metrics, as well as limitations on our ability to pay distributions or dividends while there is an ongoing event of default or to the extent such distribution causes an event of default. We are required to maintain certain minimum interest coverage ratios, liquidity levels and asset coverage ratios as defined in the Credit Agreement. We were in compliance with all such covenants as of June 30, 2016. There were no amounts outstanding under the Credit Agreement as of June 30, 2016 or December 31, 2015.

Shareholders' Equity

Shareholders' Equity	6 Months Ended
	Jun. 30, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Shareholders' Equity	6. Shareholders’ Equity Equity Compensation Plans We have a stock plan (the “Stock Plan”) and an inducement stock plan for newly hired employees (the “Inducement Plan”) (collectively, the “Plans”). Under the Plans, stock options to purchase shares of our common stock may be granted with a fixed exercise price that is equal to the fair market value of our common stock on the date of grant. These options have a term of up to 10 years and vest over a predetermined period, generally four years. Incentive stock options granted under the Stock Plan may only be granted to our employees. The Plans also allow for awards of non-qualified stock options, stock appreciation rights, RSAs and unrestricted stock awards, and RSUs. Expense is recorded for performance options over the requisite service periods when achievement of related performance targets are considered to be probable. Stock-Based Compensation The estimated fair value of stock-based awards is recognized as compensation expense over the vesting period of the award, net of estimated forfeitures. We estimate forfeitures based on historical experience and expected future activity. The fair value of RSUs is determined based on the number of shares granted and the quoted price of our common stock on the date of grant. The fair value of stock option awards is estimated at the grant date based on the fair value of each vesting tranche as calculated by the Black-Scholes-Merton (“BSM”) option-pricing model. The BSM model requires various highly judgmental assumptions including expected volatility and option life. If any of the assumptions used in the BSM model change significantly, stock-based compensation expense may differ materially in the future from that recorded in the current period. The fair values of our stock option grants were estimated with the following weighted average assumptions: Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Dividend yield 0 % 0 % 0 % 0 % Expected life 3.4 years 3.3 years 3.4 years 3.3 years Expected volatility 55 % 52 % 55 % 52 % Risk-free interest rate 1.1 % 1.3 % 1.1 % 1.2 % The impact on our results of operations from stock-based compensation expense was as follows (in thousands, except per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Cost of revenue — service $ 36 $ 105 $ 173 $ 218 Selling, general and administrative 150 182 357 320 Research and development 29 18 98 31 Total stock-based compensation expense $ 215 $ 305 $ 628 $ 569 Per diluted share $ 0.02 $ 0.02 $ 0.05 $ 0.05 Stock Option Activity The following table summarizes stock option activity under the Plans for the six-month period ended June 30, 2016: Stock Options Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Aggregate Intrinsic Value Balance at January 1, 2016 1,778,697 $ 4.43 Granted 176,075 5.80 Exercised (124,176 ) 2.86 Forfeited (313,148 ) 5.22 Expired (878 ) 5.23 Balance at June 30, 2016 1,516,570 $ 4.56 6.71 $ 2,028,252 Vested and expected to vest at June 30, 2016 1,445,567 $ 4.50 6.61 $ 1,999,111 Exercisable at June 30, 2016 806,776 $ 3.73 4.95 $ 1,558,756 At June 30, 2016, total compensation cost related to stock options granted but not yet recognized was $726,953, net of estimated forfeitures. This cost will be amortized on the straight-line method over a weighted-average period of approximately 1.04 years. The following table summarizes certain information about stock options: Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Weighted-average grant-date fair value of option grants for the period $ 2.87 $ 1.88 $ 3.05 $ 1.92 Options in-the-money at period end 948,745 1,390,199 948,745 1,390,199 Aggregate intrinsic value of options exercised $ 310,756 $ 302,895 $ 360,086 $ 350,776 The aggregate intrinsic value represents the difference between the exercise price of the underlying options and the quoted price of our common stock for the number of options that were in-the-money at period end or that were exercised during the period. We issue new shares of common stock upon exercise of stock options. Restricted Stock Unit Activity The following table summarizes RSU activity for the six-month period ended June 30, 2016: Number of Shares Weighted Average Grant Date Fair Value Unvested at January 1, 2016 104,463 $ 5.97 Granted 41,429 5.78 Vested (29,147 ) 6.11 Forfeited (15,969 ) 5.77 Unvested at June 30, 2016 100,776 $ 5.89 Expected to vest after June 30, 2016 91,667 $ 5.87 At June 30, 2016, total compensation cost related to RSUs granted but not yet recognized was $370,774, net of estimated forfeitures. This cost will be amortized on the straight-line method over a period of approximately 0.96 years. Common Stock Reserved for Future Issuance The following table summarizes our shares of common stock reserved for future issuance under the Plans as of June 30, 2016: Stock options outstanding 1,516,570 RSUs outstanding 100,776 Stock awards available for future grant 1,132,968 Common stock reserved for future issuance 2,750,314

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2016
Commitments And Contingencies Disclosure [Abstract]
Commitments and Contingencies	7. Commitments and Contingencies Lease and rent obligations Our commitments include obligations outstanding under operating leases, which expire through 2020. We have lease commitments for office space in Bellevue, Washington; San Diego, California; Boston, Massachusetts; Taipei, Taiwan; Tokyo, Japan; and Trowbridge, UK. We also lease office space on a month-to-month basis in Akron, Ohio. In August 2013, we amended the lease agreement for our Bellevue, Washington headquarters, which was initially scheduled to expire in August 2014, and extended the lease term to May 2020. The amendment to the headquarters lease provided that no cash lease payments were to be made for a seven-month period from June 1, 2013 to December 31, 2013. In conjunction with the amended lease agreement, the landlord provided lease incentives totaling $1,128,000 for leasehold improvements and furniture related to new space in the same building, which were capitalized and are reflected in the deferred rent liability. We are amortizing these assets over the shorter of their economic life or the lease term. Rent expense was $259,000 and $519,000 for the three and six months ended June 30, 2016, respectively, and $257,000 and $521,000 for the three and six months ended June 30, 2015, respectively. As of June 30, 2016, we had $250,000 pledged as collateral for a bank letter of credit under the terms of our headquarters facility lease. The pledged cash supporting the outstanding letter of credit is classified as restricted cash. Future operating lease commitments are as follows by calendar year (in thousands): Remainder of 2016 $ 661 2017 1,185 2018 1,094 2019 1,038 2020 437 Total commitments $ 4,415 Loss Contingencies From time to time, we are subject to legal proceedings, claims, and litigation arising in the ordinary course of business including tax assessments. We defend ourselves vigorously against any such claims. When (i) it is probable that an asset has been impaired or a liability has been incurred and (ii) the amount of the loss can be reasonably estimated, we record the estimated loss. We provide disclosure in the notes to the consolidated financial statements for loss contingencies that do not meet both of these conditions if there is a reasonable possibility that a loss may have been incurred that would be material to the financial statements. Significant judgment is required to determine the probability that a liability has been incurred and whether such liability is reasonably estimable. We base accruals made on the best information available at the time which can be highly subjective. The final outcome of these matters could vary significantly from the amounts included in the accompanying consolidated financial statements. A third-party software vendor invoiced us a total of $934,000 for certain licensed software that was lost in transit by a common carrier during the second quarter of 2014. We accrued a liability of $100,000 in the second quarter of 2014 as an estimate of our potential liability for legal and insurance deductible expenses. During the first quarter of 2015, the vendor credited our account for the full $934,000 as the licenses had been deactivated and there was no indication of counterfeit use. Accordingly, we reversed approximately $85,000 of the accrual after payment of legal expenses in the first quarter of 2015. Volume Pricing Agreements In conjunction with our activities under our OEM Distribution Agreements (“ODAs”) with Microsoft Corporation (“Microsoft”), as further described in Note 9, we have entered into OEM Volume Royalty Pricing (“OVRP”) commitments with Microsoft. Under these OVRPs, we are provided with volume pricing on a customer-by-customer basis assuming certain minimum unit volumes are met. The OVRP terms are 12 months. In the event we do not meet the committed minimum unit volumes, we are obligated to pay the difference between the committed per-unit volume rate and the actual per-unit rate we achieved based upon actual units purchased. The OVRP arrangements do not equate to a minimum purchase commitment, but rather, the arrangements are a volume pricing arrangement based upon actual volume purchased. In substantially all significant instances, we have reciprocal agreements with our customers such that we will receive per-unit price adjustments, similar to the amounts we would subsequently owe to Microsoft if such OVRP volumes are not met. However, in the event a customer is unwilling or unable to pay us, we would be negatively impacted. Based upon the credit-worthiness of our customers, our historical OVRP experience with our customers and OVRP arrangements in general, we do not believe we will incur any material liability relating to active agreements, and, therefore, no provision or reserve has been recorded as of June 30, 2016 or December 31, 2015. In late 2015 Microsoft implemented significant pricing changes for its embedded products, including ending its design registration pricing discounts and its OVRP and changing the aggregate volume price structure and product royalties for existing embedded Windows products effective January 1, 2016. In December 2015 we renewed the majority of our Microsoft licensing customer agreements for 2016 retaining 2015 pricing. As a result, the price changes implemented by Microsoft may not have a significant impact until 2017.

Information about Geographic Ar

Information about Geographic Areas	6 Months Ended
	Jun. 30, 2016
Segment Reporting [Abstract]
Information about Geographic Areas	8. Information about Geographic Areas Our chief operating decision-makers (i.e., our Chief Executive Officer and certain direct reports) review financial information presented on a consolidated basis, accompanied by disaggregated information for purposes of allocating resources and evaluating financial performance. There are no segment managers who are held accountable by our chief operating decision-makers, or anyone else, for operations, operating results, or planning for levels or components below the consolidated unit level. Accordingly, we consider ourselves to be in a single reporting segment and operating unit structure. Revenue by geography is based on the sales region of the customer. The following table sets forth revenue and long-lived assets by geographic area (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Total revenue: North America $ 21,291 $ 27,015 $ 45,359 $ 50,761 Asia 554 603 828 1,988 Europe 893 1,255 1,990 2,389 Total revenue $ 22,738 $ 28,873 $ 48,177 $ 55,138 June 30, 2016 December 31, 2015 Long-lived assets: North America $ 1,062 $ 1,353 Asia 265 247 Europe 4,294 4,345 Total long-lived assets $ 5,621 $ 5,945

Significant Risk Concentrations

Significant Risk Concentrations	6 Months Ended
	Jun. 30, 2016
Risks And Uncertainties [Abstract]
Significant Risk Concentrations	9. Significant Risk Concentrations Significant Customer One customer, Honeywell International, Inc. and affiliated entities (“Honeywell”), accounted for $3.5 million, or 16%, and $7.7 million, or 16%, of total revenue for the three and six months ended June 30, 2016, respectively. Another customer, Future Electronics, Inc., accounted for $3.9 million, or 13%, and $7.9 million, or 14%, of total revenue for the three and six months ended June 30, 2015, respectively. No other customers accounted for more than 10% of our revenue for any of the periods noted above. Honeywell had total accounts receivable balances of $7.1 million, or approximately 38% of total accounts receivable, at June 30, 2016 and $6.1 million, or 32% of total accounts receivable, at December 31, 2015. No other customers had accounts receivable balances that were 10% or more of the total accounts receivable at June 30, 2016 or December 31, 2015. Significant Supplier We have two ODAs with Microsoft which enable us to sell Microsoft Windows Embedded operating systems to our customers in the United States, Canada, Argentina, Brazil, Chile, Columbia, Mexico, Peru, Puerto Rico, the Caribbean, the European Union, the European Free Trade Association, Turkey and Africa, which expire on June 30, 2017. We also have four ODAs with Microsoft which allow us to sell Microsoft Windows Mobile operating systems in the Americas (excluding Cuba), Japan, Taiwan, Europe, the Middle East, and Africa, which also expire on June 30, 2017. Software sales under these agreements constitute a significant portion of our software revenue and total revenue. These agreements are typically renewed bi-annually, annually or semi-annually; however, there is no automatic renewal provision in any of these agreements. Further, these agreements can be terminated unilaterally by Microsoft at any time. Microsoft currently offers a rebate program to sell Microsoft Windows Embedded operating systems pursuant to which we earn money for achieving certain predefined objectives. Under this rebate program, we recognized $123,000 and $209,000 during the three and six months ended June 30, 2016, respectively, compared to $103,000 and $166,000 during the three and six months ended June 30, 2015, respectively. These rebates were treated as reductions in cost of sales. Additionally, during the three and six months ended June 30, 2016, we qualified for $288,000 and $489,000, respectively, in rebate credits, compared to $240,000 and $387,000 for the three and six months ended June 30, 2015, respectively. These are accounted for as reductions in marketing expense if and when qualified program expenditures are made. Microsoft has implemented significant pricing changes for its embedded products, including ending its design registration pricing discounts, its OVRP and changing the aggregate volume price structure and product royalties for existing embedded Windows products effective January 1, 2016. In December 2015 we renewed the majority of our Microsoft licensing customer agreements for 2016 retaining 2015 pricing. As a result, the price changes implemented by Microsoft may not have a significant impact until 2017.

Subsequent Event

Subsequent Event	6 Months Ended
	Jun. 30, 2016
Subsequent Events [Abstract]
Subsequent Event	10. Subsequent Event On July 28, 2016, our board of Directors approved a restructuring plan that includes a workforce reduction in our professional engineering services group. The workforce reduction will impact 26 personnel, comprised of both employees and consultants, representing approximately 13% of our pre-reduction headcount, and is intended to reduce expenses in our professional engineering services workforce and to better align our organizational structure with our increasing strategic focus on DataV software and services. We currently anticipate incurring pre-tax restructuring charges of approximately $0.6 million in the third quarter of 2016, representing one-time cash employee termination benefits including severance, accrued paid-time off and other employment obligations. We expect the staff reductions will be substantially completed by the end of the third quarter of 2016 and anticipate that the majority of the cost savings will be realized beginning in the fourth quarter of 2016.

Summary of Significant Accoun16

Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2016
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements of BSQUARE Corporation (“BSQUARE”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting and include the accounts of BSQUARE and our wholly owned subsidiaries. Certain information and footnote disclosures normally included in the annual consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. In our opinion, the unaudited condensed consolidated financial statements include all material adjustments, all of which are of a normal and recurring nature, necessary to present fairly our financial position as of June 30, 2016, our operating results for the three and six months ended June 30, 2016 and 2015 and our cash flows for the six months ended June 30, 2016 and 2015. The accompanying financial information as of December 31, 2015 is derived from audited financial statements. Preparing financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Examples include provisions for bad debts and income taxes, estimates of progress on professional engineering service arrangements and bonus accruals. Actual results may differ from these estimates. Interim results are not necessarily indicative of results for a full year. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2015. All intercompany balances have been eliminated.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers,” amending revenue recognition guidance and requiring more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The guidance, as amended, is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted for public companies effective for annual and interim reporting periods beginning after December 15, 2016. We are currently evaluating the impact this ASU will have on our consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17, “Balance Sheet Classification of Deferred Taxes,” to simplify the presentation of deferred income taxes. The amendments in this ASU require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The amendments in this ASU apply to all entities that present a classified statement of financial position. The current requirement that deferred tax liabilities and assets of a tax-paying component of an entity be offset and presented as a single amount is not affected by the amendments in this ASU. We adopted the new guidance retrospectively beginning with the year ended December 31, 2014, and applied such guidance consistently for the year ended December 31, 2015. In February 2016, the FASB issued ASU No. 2016-2, “Leases,” to make leasing activities more transparent and comparable, requiring most leases be recognized by lessees on their balance sheets as right-of-use assets, along with corresponding lease liabilities. ASU 2016-2 is effective for public business entities for annual periods beginning after December 31, 2018 and interim periods within that year, with early adoption permitted. We are currently evaluating the impact this ASU may have on our consolidated financial statements and related disclosures. In March 2016, the FASB amended the existing accounting standards for stock-based compensation, ASU 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting
Income (Loss) Per Share	Income (Loss) Per Share Basic income (loss) per share is computed using the weighted average number of common shares outstanding during the period, and excludes any dilutive effects of common stock equivalent shares, such as options, restricted stock awards and restricted stock units. Restricted stock awards (“RSAs”) are considered outstanding and included in the computation of basic income or loss per share when underlying restrictions expire and the awards are no longer forfeitable. Restricted stock units (“RSUs”) are considered outstanding and included in the computation of basic income or loss per share only when vested. Diluted income (loss) per share is computed using the weighted average number of common shares outstanding and common stock equivalent shares outstanding during the period using the treasury stock method. Common stock equivalent shares are excluded from the computation if their effect is anti-dilutive. We excluded an aggregate of 1,864,147 and 654,441 options for the three and six months ended June 30, 2016, respectively, from diluted earnings per share because their effect was anti-dilutive. For the three months ended June 30, 2016, this included common stock equivalent shares of 1,188,189 calculated using the treasury stock method that would have been included in diluted earnings per share had we been in a net income position. In a period where we are in a loss position, diluted loss per share is computed using the basic share count. We excluded an aggregate of 114,270 and 130,159 options for the three and six months ended June 30, 2015, respectively, from diluted earnings per share because their effect was anti-dilutive.

Cash, Cash Equivalents and In17

Cash, Cash Equivalents and Investments (Tables)	6 Months Ended
	Jun. 30, 2016
Cash And Cash Equivalents [Abstract]
Cash, Cash Equivalents and Short-Term Investments	Cash, cash equivalents and short-term investments consisted of the following (in thousands): June 30, 2016 December 31, 2015 Cash $ 8,583 $ 7,270 Cash equivalents: Money market funds 1,536 1,500 Corporate commercial paper 500 5,404 Corporate debt securities — 2,269 Total cash equivalents 2,036 9,173 Total cash and cash equivalents 10,619 16,443 Short-term investments: Corporate commercial paper 10,990 6,245 Treasury bonds — 1,007 Corporate debt securities 5,289 6,028 Total short-term investments 16,279 13,280 Restricted cash equivalents—money market fund 250 250 Total cash, cash equivalents and short-term investments $ 27,148 $ 29,973

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	6 Months Ended
	Jun. 30, 2016
Fair Value Disclosures [Abstract]
Assets and Liabilities Measured at Fair Value on Recurring Basis	Assets and liabilities measured at fair value on a recurring basis as of June 30, 2016 and December 31, 2015 are summarized below (in thousands): June 30, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1) Direct or Indirect Observable Inputs (Level 2) Total Assets Cash equivalents: Money market funds $ 1,536 $ — $ 1,536 Corporate commercial paper — 500 500 Corporate debt securities — — — Total cash equivalents 1,536 500 2,036 Short-term investments: Corporate commercial paper — 10,990 10,990 Treasury bonds — — — Corporate debt securities — 5,289 5,289 Total short-term investments — 16,279 16,279 Restricted cash equivalents—money market fund 250 — 250 Total assets measured at fair value $ 1,786 $ 16,779 $ 18,565 December 31, 2015 Quoted Prices in Active Markets for Identical Assets (Level 1) Direct or Indirect Observable Inputs (Level 2) Total Assets Cash equivalents: Money market funds $ 5,404 $ — $ 5,404 Corporate commercial paper — 1,500 1,500 Corporate debt securities — 2,269 2,269 Total cash equivalents 5,404 3,769 9,173 Short-term investments: Corporate commercial paper — 6,245 6,245 Treasury bonds — 1,007 1,007 Corporate debt securities — 6,028 6,028 Total short-term investments — 13,280 13,280 Restricted cash equivalents—money market fund 250 — 250 Total assets measured at fair value $ 5,654 $ 17,049 $ 22,703

Goodwill and Intangible Assets

Goodwill and Intangible Assets (Tables)	6 Months Ended
	Jun. 30, 2016
Goodwill And Intangible Assets Disclosure [Abstract]
Information Regarding Intangible Assets	Information regarding our intangible assets is as follows (in thousands): June 30, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Value Customer relationships $ 1,275 $ (749 ) $ 526 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Carrying Value Customer relationships $ 1,275 $ (681 ) $ 594
Expected Amortization Expense for Future Period	Amortization in future periods is expected to be as follows (in thousands): Remainder of 2016 $ 63 2017 98 2018 98 2019 98 2020 98 2021 71 Total $ 526

Shareholders' Equity (Tables)

Shareholders' Equity (Tables)	6 Months Ended
	Jun. 30, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Fair Values of Stock Option Grants Estimated with Weighted Average Assumptions	The fair values of our stock option grants were estimated with the following weighted average assumptions: Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Dividend yield 0 % 0 % 0 % 0 % Expected life 3.4 years 3.3 years 3.4 years 3.3 years Expected volatility 55 % 52 % 55 % 52 % Risk-free interest rate 1.1 % 1.3 % 1.1 % 1.2 %
Stock-Based Compensation Expense	The impact on our results of operations from stock-based compensation expense was as follows (in thousands, except per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Cost of revenue — service $ 36 $ 105 $ 173 $ 218 Selling, general and administrative 150 182 357 320 Research and development 29 18 98 31 Total stock-based compensation expense $ 215 $ 305 $ 628 $ 569 Per diluted share $ 0.02 $ 0.02 $ 0.05 $ 0.05
Summary of Stock Option Activity	The following table summarizes stock option activity under the Plans for the six-month period ended June 30, 2016: Stock Options Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Aggregate Intrinsic Value Balance at January 1, 2016 1,778,697 $ 4.43 Granted 176,075 5.80 Exercised (124,176 ) 2.86 Forfeited (313,148 ) 5.22 Expired (878 ) 5.23 Balance at June 30, 2016 1,516,570 $ 4.56 6.71 $ 2,028,252 Vested and expected to vest at June 30, 2016 1,445,567 $ 4.50 6.61 $ 1,999,111 Exercisable at June 30, 2016 806,776 $ 3.73 4.95 $ 1,558,756
Summary of Certain Information about Stock Options	The following table summarizes certain information about stock options: Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Weighted-average grant-date fair value of option grants for the period $ 2.87 $ 1.88 $ 3.05 $ 1.92 Options in-the-money at period end 948,745 1,390,199 948,745 1,390,199 Aggregate intrinsic value of options exercised $ 310,756 $ 302,895 $ 360,086 $ 350,776
Summary of Restricted Stock Unit Activity	The following table summarizes RSU activity for the six-month period ended June 30, 2016: Number of Shares Weighted Average Grant Date Fair Value Unvested at January 1, 2016 104,463 $ 5.97 Granted 41,429 5.78 Vested (29,147 ) 6.11 Forfeited (15,969 ) 5.77 Unvested at June 30, 2016 100,776 $ 5.89 Expected to vest after June 30, 2016 91,667 $ 5.87
Summary of Shares of Common Stock Reserved for Future Issuance under Plans	The following table summarizes our shares of common stock reserved for future issuance under the Plans as of June 30, 2016: Stock options outstanding 1,516,570 RSUs outstanding 100,776 Stock awards available for future grant 1,132,968 Common stock reserved for future issuance 2,750,314

Commitments and Contingencies (

Commitments and Contingencies (Tables)	6 Months Ended
	Jun. 30, 2016
Commitments And Contingencies Disclosure [Abstract]
Future Operating Lease Commitments	Future operating lease commitments are as follows by calendar year (in thousands): Remainder of 2016 $ 661 2017 1,185 2018 1,094 2019 1,038 2020 437 Total commitments $ 4,415

Information about Geographic 22

Information about Geographic Areas (Tables)	6 Months Ended
	Jun. 30, 2016
Segment Reporting [Abstract]
Revenue and Long-Lived Assets by Geographic Area	Revenue by geography is based on the sales region of the customer. The following table sets forth revenue and long-lived assets by geographic area (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Total revenue: North America $ 21,291 $ 27,015 $ 45,359 $ 50,761 Asia 554 603 828 1,988 Europe 893 1,255 1,990 2,389 Total revenue $ 22,738 $ 28,873 $ 48,177 $ 55,138 June 30, 2016 December 31, 2015 Long-lived assets: North America $ 1,062 $ 1,353 Asia 265 247 Europe 4,294 4,345 Total long-lived assets $ 5,621 $ 5,945

Summary of Significant Accoun23

Summary of Significant Accounting Policies - Additional Information (Detail) - Options [Member] - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Summary Of Accounting Policies [Line Items]
Shares excluded from computations of diluted earnings per share	1,864,147	114,270	654,441	130,159
Dilutive effect of common stock equivalent shares using treasury stock method	1,188,189

Cash, Cash Equivalents and In24

Cash, Cash Equivalents and Investments - Cash, Cash Equivalents and Short-Term Investments (Detail) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015	Jun. 30, 2015	Dec. 31, 2014
Investment Holdings [Line Items]
Cash	$ 8,583	$ 7,270
Cash equivalents:
Total cash equivalents	2,036	9,173
Total cash and cash equivalents	10,619	16,443	$ 11,966	$ 13,127
Short-term investments:
Total short-term investments	16,279	13,280
Restricted cash equivalents—money market fund	250	250
Total cash, cash equivalents and short-term investments	27,148	29,973
Corporate commercial paper [Member]
Cash equivalents:
Total cash equivalents	500	5,404
Short-term investments:
Total short-term investments	10,990	6,245
Corporate debt securities [Member]
Cash equivalents:
Total cash equivalents		2,269
Short-term investments:
Total short-term investments	5,289	6,028
Treasury bonds [Member]
Short-term investments:
Total short-term investments		1,007
Money market funds [Member]
Cash equivalents:
Total cash equivalents	$ 1,536	$ 1,500

Fair Value Measurements - Asset

Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Short-term investments:
Total short-term investments	$ 16,279	$ 13,280
Restricted cash equivalents—money market fund	250	250
Recurring basis [Member]
Cash equivalents:
Total cash equivalents	2,036	9,173
Short-term investments:
Total short-term investments	16,279	13,280
Restricted cash equivalents—money market fund	250	250
Total assets measured at fair value	18,565	22,703
Corporate commercial paper [Member]
Short-term investments:
Total short-term investments	10,990	6,245
Corporate commercial paper [Member] | Recurring basis [Member]
Cash equivalents:
Total cash equivalents	500	1,500
Short-term investments:
Total short-term investments	10,990	6,245
Corporate debt securities [Member]
Short-term investments:
Total short-term investments	5,289	6,028
Corporate debt securities [Member] | Recurring basis [Member]
Cash equivalents:
Total cash equivalents		2,269
Short-term investments:
Total short-term investments	5,289	6,028
Treasury bonds [Member]
Short-term investments:
Total short-term investments		1,007
Treasury bonds [Member] | Recurring basis [Member]
Short-term investments:
Total short-term investments		1,007
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Recurring basis [Member]
Cash equivalents:
Total cash equivalents	1,536	5,404
Short-term investments:
Restricted cash equivalents—money market fund	250	250
Total assets measured at fair value	1,786	5,654
Direct or Indirect Observable Inputs (Level 2) [Member] | Recurring basis [Member]
Cash equivalents:
Total cash equivalents	500	3,769
Short-term investments:
Total short-term investments	16,279	13,280
Total assets measured at fair value	16,779	17,049
Direct or Indirect Observable Inputs (Level 2) [Member] | Corporate commercial paper [Member] | Recurring basis [Member]
Cash equivalents:
Total cash equivalents	500	1,500
Short-term investments:
Total short-term investments	10,990	6,245
Direct or Indirect Observable Inputs (Level 2) [Member] | Corporate debt securities [Member] | Recurring basis [Member]
Cash equivalents:
Total cash equivalents		2,269
Short-term investments:
Total short-term investments	5,289	6,028
Direct or Indirect Observable Inputs (Level 2) [Member] | Treasury bonds [Member] | Recurring basis [Member]
Short-term investments:
Total short-term investments		1,007
Money market funds [Member] | Recurring basis [Member]
Cash equivalents:
Total cash equivalents	1,536	5,404
Money market funds [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Recurring basis [Member]
Cash equivalents:
Total cash equivalents	$ 1,536	$ 5,404

Goodwill and Intangible Asset26

Goodwill and Intangible Assets - Additional Information (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Goodwill And Intangible Assets Disclosure [Abstract]
Change in carrying amount of goodwill	$ 0		$ 0
Amortization expense	$ 34,000	$ 34,000	$ 68,000	$ 68,000

Goodwill and Intangible Asset27

Goodwill and Intangible Assets - Information Regarding Intangible Assets (Detail) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Acquired Finite-Lived Intangible Assets [Line Items]
Net Carrying Value	$ 526	$ 594
Customer relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	1,275	1,275
Accumulated Amortization	(749)	(681)
Net Carrying Value	$ 526	$ 594

Goodwill and Intangible Asset28

Goodwill and Intangible Assets - Expected Amortization Expense for Future Period (Detail) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Goodwill And Intangible Assets Disclosure [Abstract]
Remainder of 2016	$ 63
2,017	98
2,018	98
2,019	98
2,020	98
2,021	71
Net Carrying Value	$ 526	$ 594

Credit Agreement - Additional I

Credit Agreement - Additional Information (Detail) - Credit Agreement [Member] - Unsecured Line of Credit Agreement [Member] - USD ($)	Sep. 22, 2015	Jun. 30, 2016	Dec. 31, 2015
Line Of Credit Facility [Line Items]
Line of credit, interest rate description		The Credit Agreement shall bear interest at either (1) a rate per annum equal to 1.5% below the bank’s applicable prime rate or (2) 1.5% above the Bank’s applicable LIBOR rate, in each case as defined in the Credit Agreement.
Line of credit, amount outstanding		$ 0	$ 0
Prime Rate [Member] | Minimum [Member]
Line Of Credit Facility [Line Items]
Line of credit, interest rate, basis spread on variable rate		1.50%
LIBOR Rate [Member] | Maximum [Member]
Line Of Credit Facility [Line Items]
Line of credit, interest rate, basis spread on variable rate		1.50%
JPMorgan Chase Bank, N.A. [Member]
Line Of Credit Facility [Line Items]
Line of credit, term	2 years
Line of credit, maximum borrowing capacity	$ 12,000,000

Shareholders' Equity - Addition

Shareholders' Equity - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2016USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation cost related to stock options granted but not yet recognized, net of estimated forfeitures	$ 726,953
Amortization cost, weighted-average period	1 year 15 days
Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Term of stock options granted	10 years
Vesting of options granted	4 years
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Amortization cost, weighted-average period	11 months 16 days
Compensation cost related to restricted stock units granted but not yet recognized, net of estimated forfeitures	$ 370,774

Shareholders' Equity - Fair Val

Shareholders' Equity - Fair Values of Stock Option Grants Estimated with Weighted Average Assumptions (Detail) - Employee Stock Option [Member]	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%	0.00%	0.00%	0.00%
Expected life	3 years 4 months 24 days	3 years 3 months 18 days	3 years 4 months 24 days	3 years 3 months 18 days
Expected volatility	55.00%	52.00%	55.00%	52.00%
Risk-free interest rate	1.10%	1.30%	1.10%	1.20%

Shareholders' Equity - Stock-Ba

Shareholders' Equity - Stock-Based Compensation Expense (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 215	$ 305	$ 628	$ 569
Per diluted share	$ 0.02	$ 0.02	$ 0.05	$ 0.05
Cost of revenue-service [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 36	$ 105	$ 173	$ 218
Selling, general and administrative [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	150	182	357	320
Research and development [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 29	$ 18	$ 98	$ 31

Shareholders' Equity - Summary

Shareholders' Equity - Summary of Stock Option Activity (Detail)	6 Months Ended
	Jun. 30, 2016USD ($)$ / sharesshares
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Roll Forward
Number of Shares, Beginning Balance | shares	1,778,697
Granted, Number of Shares | shares	176,075
Exercised, Number of Shares | shares	(124,176)
Forfeited, Number of Shares | shares	(313,148)
Expired, Number of Shares | shares	(878)
Number of Shares, Ending Balance | shares	1,516,570
Vested and expected to vest, Number of Shares, Ending Balance | shares	1,445,567
Exercisable, Number of Shares, Ending Balance | shares	806,776
Weighted Average Exercise Price, Beginning Balance | $ / shares	$ 4.43
Granted, Weighted Average Exercise Price | $ / shares	5.80
Exercised, Weighted Average Exercise Price | $ / shares	2.86
Forfeited, Weighted Average Exercise Price | $ / shares	5.22
Expired, Weighted Average Exercise Price | $ / shares	5.23
Weighted Average Exercise Price, Ending Balance | $ / shares	4.56
Vested and expected to vest, Weighted Average Exercise Price, Ending Balance | $ / shares	4.50
Exercisable, Weighted Average Exercise Price, Ending Balance | $ / shares	$ 3.73
Weighted Average Remaining Contractual Life (in years)	6 years 8 months 16 days
Vested and expected to vest, Weighted Average Remaining Contractual Life (in years)	6 years 7 months 10 days
Exercisable, Weighted Average Remaining Contractual Life (in years)	4 years 11 months 12 days
Aggregate Intrinsic Value | $	$ 2,028,252
Vested and expected to vest, Aggregate Intrinsic Value | $	1,999,111
Exercisable, Aggregate Intrinsic Value | $	$ 1,558,756

Shareholders' Equity - Summar34

Shareholders' Equity - Summary of Certain Information about Stock Options (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Weighted-average grant-date fair value of option grants for the period	$ 2.87	$ 1.88	$ 3.05	$ 1.92
Options in-the-money at period end	948,745	1,390,199	948,745	1,390,199
Aggregate intrinsic value of options exercised	$ 310,756	$ 302,895	$ 360,086	$ 350,776

Shareholders' Equity - Summar35

Shareholders' Equity - Summary of Restricted Stock Unit Activity (Detail)	6 Months Ended
	Jun. 30, 2016$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unvested, Number of Shares, Ending Balance	100,776
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unvested, Number of Shares, Beginning Balance	104,463
Granted, Number of Shares	41,429
Vested, Number of Shares	(29,147)
Forfeited, Number of Shares	(15,969)
Unvested, Number of Shares, Ending Balance	100,776
Expected to vest, Number of Shares, Ending Balance	91,667
Unvested, Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares	$ 5.97
Granted, Weighted Average Grant Date Fair Value | $ / shares	5.78
Vested, Weighted Average Grant Date Fair Value | $ / shares	6.11
Forfeited, Weighted Average Grant Date Fair Value | $ / shares	5.77
Unvested, Weighted Average Grant Date Fair Value, Ending Balance | $ / shares	5.89
Expected to vest, Weighted Average Grant Date Fair Value, Ending Balance | $ / shares	$ 5.87

Shareholders' Equity - Summar36

Shareholders' Equity - Summary of Shares of Common Stock Reserved for Future Issuance under Plans (Detail) - shares	Jun. 30, 2016	Dec. 31, 2015
Common Stock Number Of Shares Par Value And Other Disclosures [Abstract]
Stock options outstanding	1,516,570	1,778,697
RSUs outstanding	100,776
Stock awards available for future grant	1,132,968
Common stock reserved for future issuance	2,750,314

Commitments and Contingencies -

Commitments and Contingencies - Additional Information (Detail) - USD ($)	1 Months Ended	3 Months Ended				6 Months Ended		7 Months Ended
	Aug. 31, 2013	Jun. 30, 2016	Jun. 30, 2015	Mar. 31, 2015	Jun. 30, 2014	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2013	Dec. 31, 2015
Other Commitments [Line Items]
Operating leases, expiration year						2,020
Rent expense		$ 259,000	$ 257,000			$ 519,000	$ 521,000
Restricted cash equivalents		250,000				250,000			$ 250,000
Third party software vendor licensed lost					$ 934,000
Accrued contingent liability		$ 0			$ 100,000	$ 0			$ 0
Loss contingency receivable				$ 934,000
Payment of legal expenses				$ 85,000
Volume pricing agreements period of OVRP						12 months
Bellevue [Member] | Washington [Member]
Other Commitments [Line Items]
Expiration date of operating lease	2014-08
Extended expiration date of operating lease	2020-05
Cash lease payments made								$ 0
Leasehold improvements and furniture provided by the landlord	$ 1,128,000

Commitments and Contingencies38

Commitments and Contingencies - Future Operating Lease Commitments (Detail) $ in Thousands	Jun. 30, 2016USD ($)
Operating Leases Future Minimum Payments Due [Abstract]
Remainder of 2016	$ 661
2,017	1,185
2,018	1,094
2,019	1,038
2,020	437
Total commitments	$ 4,415

Information about Geographic 39

Information about Geographic Areas - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2016Segment
Segment Reporting [Abstract]
Number of reportable segment	1
Number of operating segment	1

Information about Geographic 40

Information about Geographic Areas - Revenue and Long-Lived Assets by Geographic Area (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015
Total revenue:
Total revenue	$ 22,738	$ 28,873	$ 48,177	$ 55,138
Long-lived assets:
Total long-lived assets	5,621		5,621		$ 5,945
North America [Member]
Total revenue:
Total revenue	21,291	27,015	45,359	50,761
Long-lived assets:
Total long-lived assets	1,062		1,062		1,353
Asia [Member]
Total revenue:
Total revenue	554	603	828	1,988
Long-lived assets:
Total long-lived assets	265		265		247
Europe [Member]
Total revenue:
Total revenue	893	$ 1,255	1,990	$ 2,389
Long-lived assets:
Total long-lived assets	$ 4,294		$ 4,294		$ 4,345

Significant Risk Concentratio41

Significant Risk Concentrations - Additional Information (Detail)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2016USD ($)Customer	Jun. 30, 2015USD ($)Customer	Jun. 30, 2016USD ($)CustomerAgreement	Jun. 30, 2015USD ($)Customer	Dec. 31, 2015USD ($)Customer
Concentration Risk [Line Items]
Total revenue	$ 22,738,000	$ 28,873,000	$ 48,177,000	$ 55,138,000
Accounts receivable	19,377,000		$ 19,377,000		$ 19,009,000
Expiration date one of OEM Distribution agreements for embedded operating systems			Jun. 30, 2017
Number of OEM Distribution agreements for embedded operating systems | Agreement			2
Expiration date of OEM Distribution agreements for mobile operating systems, non-EMEA			Jun. 30, 2017
Number of OEM Distribution agreements for mobile operating systems | Agreement			4
Cost of revenue-service [Member]
Concentration Risk [Line Items]
Earnings under the rebate program	123,000	103,000	$ 209,000	166,000
Reduction in marketing expense [Member]
Concentration Risk [Line Items]
Earnings under the rebate program	288,000	240,000	489,000	387,000
Honeywell International Inc and affiliated entities [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Total revenue	3,500,000		7,700,000
Honeywell International Inc and affiliated entities [Member] | Credit Concentration Risk [Member]
Concentration Risk [Line Items]
Accounts receivable	$ 7,100,000		$ 7,100,000		$ 6,100,000
Future Electronics, Inc. [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Total revenue		$ 3,900,000		$ 7,900,000
Revenue [Member] | Honeywell International Inc and affiliated entities [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Number of customer account as major customer | Customer	1		1
Concentration risk, percentage	16.00%		16.00%
Revenue [Member] | Future Electronics, Inc. [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Number of customer account as major customer | Customer		1		1
Concentration risk, percentage		13.00%		14.00%
Revenue [Member] | Customer accounted for 10% or more [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Number of customer account as major customer | Customer	0	0	0	0
Accounts receivable [Member] | Honeywell International Inc and affiliated entities [Member] | Credit Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration risk, percentage			38.00%		32.00%
Accounts receivable [Member] | Customer accounted for 10% or more [Member] | Credit Concentration Risk [Member]
Concentration Risk [Line Items]
Number of customer account as major customer | Customer			0		0

Subsequent Event - Additional I

Subsequent Event - Additional Information (Detail) $ in Millions	Jul. 28, 2016Employee	Sep. 30, 2016USD ($)	Jun. 30, 2016
Subsequent Event [Line Items]
Effective date of restructuring			Jul. 28, 2016
Scenario, Forecast [Member]
Subsequent Event [Line Items]
Pre-tax restructuring charges | $		$ 0.6
Subsequent Event [Member]
Subsequent Event [Line Items]
Expected number of employees will be impacted by workforce reduction | Employee	26
Expected percentage of pre-reduction headcount will be impacted by workforce reduction	13.00%