Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Sep. 30, 2016 | Oct. 31, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | EPAY | |
Entity Registrant Name | BOTTOMLINE TECHNOLOGIES INC /DE/ | |
Entity Central Index Key | 1,073,349 | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 40,529,993 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 30, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 98,706 | $ 97,174 |
Marketable securities | 29,182 | 35,209 |
Accounts receivable net of allowances for doubtful accounts of $960 at September 30, 2016 and $982 at June 30, 2016 | 52,689 | 61,773 |
Deferred tax assets | 6,244 | |
Prepaid expenses and other current assets | 17,130 | 16,141 |
Total current assets | 197,707 | 216,541 |
Property and equipment, net | 53,718 | 51,029 |
Goodwill | 201,489 | 202,028 |
Intangible assets, net | 158,981 | 164,930 |
Other assets | 16,538 | 16,682 |
Total assets | 628,433 | 651,210 |
Current liabilities: | ||
Accounts payable | 9,313 | 10,218 |
Accrued expenses | 26,311 | 27,512 |
Deferred revenue | 63,616 | 74,332 |
Total current liabilities | 99,240 | 112,062 |
Convertible senior notes | 173,229 | 169,857 |
Deferred revenue, non-current | 19,231 | 19,086 |
Deferred income taxes | 21,276 | 28,147 |
Other liabilities | 27,710 | 27,271 |
Total liabilities | 340,686 | 356,423 |
Stockholders' equity | ||
Preferred Stock, $.001 par value: Authorized shares-4,000; issued and outstanding shares-none | ||
Common Stock, $.001 par value: Authorized shares-100,000; issued shares- 41,906 at September 30, 2016 and 41,602 at June 30, 2016; outstanding shares-37,926 at September 30, 2016 and 37,770 at June 30, 2016 | 42 | 42 |
Additional paid-in-capital | 600,022 | 591,800 |
Accumulated other comprehensive loss | (38,767) | (37,668) |
Treasury stock: 3,980 shares at September 30, 2016 and 3,832 shares at June 30, 2016, at cost | (79,487) | (75,832) |
Accumulated deficit | (194,063) | (183,555) |
Total stockholders' equity | 287,747 | 294,787 |
Total liabilities and stockholders' equity | $ 628,433 | $ 651,210 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 30, 2016 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, net of allowances for doubtful accounts and returns | $ 960 | $ 982 |
Preferred Stock, $.001 par value | $ 0.001 | $ 0.001 |
Preferred Stock, Authorized shares | 4,000,000 | 4,000,000 |
Preferred Stock, Issued shares | 0 | 0 |
Preferred Stock, Outstanding shares | 0 | 0 |
Common Stock, $.001 par value | $ 0.001 | $ 0.001 |
Common Stock, Authorized shares | 100,000,000 | 100,000,000 |
Common Stock, Issued shares | 41,906,000 | 41,602,000 |
Common Stock, Outstanding shares | 37,926,000 | 37,770,000 |
Treasury stock, shares | 3,980,000 | 3,832,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Revenues: | ||
Subscriptions and transactions | $ 52,132 | $ 46,197 |
Software licenses | 2,121 | 4,115 |
Service and maintenance | 27,673 | 30,784 |
Other | 1,158 | 1,785 |
Total revenues | 83,084 | 82,881 |
Cost of revenues: | ||
Subscriptions and transactions | 23,886 | 20,734 |
Software licenses | 128 | 288 |
Service and maintenance | 13,285 | 12,978 |
Other | 878 | 1,335 |
Total cost of revenues | 38,177 | 35,335 |
Gross profit | 44,907 | 47,546 |
Operating expenses: | ||
Sales and marketing | 18,875 | 20,155 |
Product development and engineering | 12,935 | 11,260 |
General and administrative | 12,704 | 8,823 |
Amortization of intangible assets | 6,285 | 7,279 |
Total operating expenses | 50,799 | 47,517 |
(Loss) income from operations | (5,892) | 29 |
Other expense, net | (3,935) | (3,671) |
Loss before income taxes | (9,827) | (3,642) |
Income tax provision | 681 | 611 |
Net loss | $ (10,508) | $ (4,253) |
Basic and diluted net loss per share: | $ (0.28) | $ (0.11) |
Shares used in computing basic and diluted net loss per share: | 37,940 | 38,004 |
Other comprehensive loss, net of tax: | ||
Unrealized (loss) gain on available for sale securities | $ (57) | $ 8 |
Minimum pension liability adjustments | 15 | 116 |
Foreign currency translation adjustments | (1,057) | (6,585) |
Other comprehensive loss, net of tax: | (1,099) | (6,461) |
Comprehensive loss | $ (11,607) | $ (10,714) |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Operating activities: | ||
Net loss | $ (10,508) | $ (4,253) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Amortization of acquired intangible assets | 6,285 | 7,279 |
Stock compensation expense | 8,199 | 7,588 |
Depreciation and amortization | 4,087 | 3,077 |
Deferred income tax benefit | (548) | (822) |
Provision for allowances on accounts receivable | 161 | |
Excess tax benefits associated with stock compensation | (40) | (27) |
Amortization of debt issuance costs | 296 | 296 |
Amortization of debt discount | 3,076 | 2,865 |
Amortization of premium on investments | 91 | 68 |
Write down of fixed assets | 17 | |
(Gain) loss on foreign exchange | (192) | 130 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 8,838 | 3,390 |
Prepaid expenses and other current assets | (1,052) | (137) |
Other assets | 127 | (1,123) |
Accounts payable | (973) | (592) |
Accrued expenses | 617 | (1,026) |
Deferred revenue | (10,253) | (5,625) |
Other liabilities | 447 | (340) |
Net cash provided by operating activities | 8,497 | 10,926 |
Investing activities: | ||
Purchases of held-to-maturity securities | (44) | |
Proceeds from sales of held-to-maturity securities | 44 | |
Purchase of available-for-sale securities | (7,579) | (4,790) |
Proceeds from sales of available-for-sale securities | 13,460 | 3,790 |
Capital expenditures including capitalization of software costs | (9,909) | (5,830) |
Net cash used in investing activities | (4,028) | (6,830) |
Financing activities: | ||
Repurchase of common stock | (3,773) | (21,354) |
Proceeds from exercise of stock options and employee stock purchase plan | 1,353 | 1,435 |
Excess tax benefits associated with stock compensation | 40 | 27 |
Net cash used in financing activities | (2,380) | (19,892) |
Effect of exchange rate changes on cash | (557) | (1,230) |
Increase (decrease) in cash and cash equivalents | 1,532 | (17,026) |
Cash and cash equivalents at beginning of period | 97,174 | 121,163 |
Cash and cash equivalents at end of period | $ 98,706 | $ 104,137 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Note 1—Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals and adjustments) considered necessary for a fair presentation of the interim financial information have been included. Operating results for the three months ended September 30, 2016, are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending June 30, 2017 (fiscal year 2017). For further information, refer to the financial statements and footnotes included in the Annual Report on Form 10-K as filed with the Securities and Exchange Commission (SEC) on August 29, 2016. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Sep. 30, 2016 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Note 2—Recent Accounting Pronouncements Recently Adopted Pronouncements In June 2014, the Financial Accounting Standards Board (FASB) issued an accounting standard update which eliminated the definition of a development stage entity and the financial reporting requirements specific to development stage entities. The update also eliminated an exception that previously existed in the consolidation accounting standard for determining whether a development stage entity had sufficient equity at risk and therefore was a variable interest entity (VIE). We adopted this standard effective July 1, 2016. Upon adoption, we were required to re-assess whether one of the entities in which we have an equity investment is a VIE. Based on the re-assessment, we concluded that this entity is a VIE, but that we are not the primary beneficiary (the primary beneficiary of a VIE is required to consolidate the VIE). Accordingly, the adoption of this standard did not have a material impact on our financial statements. In August 2014, the FASB issued an accounting standard update which requires management to evaluate, at each annual or interim reporting period, whether there are conditions or events that exist that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. We adopted this standard on July 1, 2016. The adoption of this standard did not have a material impact on our financial statements. In April 2015, the FASB issued an accounting standard update which requires that debt issuance costs be presented in the balance sheet as a direct reduction to the carrying value of the debt. We retrospectively adopted this standard effective July 1, 2016 and reclassified debt issuance costs from non-current assets to convertible senior notes in our consolidated balance sheets in all periods presented. Deferred debt issuance costs were approximately $1.4 million at September 30, 2016 and $1.7 million at June 30, 2016. In April 2015, the FASB issued an accounting standard update which provides guidance as to whether a cloud computing arrangement (e.g., software as a service, platform as a service, infrastructure as a service, and other similar arrangements) includes a software license, and based on that determination, how to account for such arrangements. We adopted this standard effective July 1, 2016 on a prospective basis. The adoption of this standard did not have a material impact on our financial statements. In November 2015, the FASB issued an accounting standard update which requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent in the balance sheet. As a result, each separate tax jurisdiction will have one net tax position, either a noncurrent deferred tax asset or a noncurrent deferred tax liability. The standard is effective for us on July 1, 2017, with early adoption permitted. We elected to adopt this standard as of July 1, 2016 on a prospective basis. If we had adopted the standard retrospectively, the impact would have resulted in a $6.2 million reduction to current deferred tax assets and noncurrent deferred tax liabilities in our June 30, 2016 balance sheet. The adoption of this standard did not have an impact on our statements of comprehensive loss or cash flows. Recent Accounting Pronouncements In May 2014, the FASB issued an accounting standard update which provides for new revenue recognition guidance, superseding nearly all existing revenue recognition guidance. The core principle of the new guidance is to recognize revenue when promised goods or services are transferred to customers, in an amount that reflects the consideration to which the vendor expects to receive for those goods or services. The new standard is expected to require more judgment and estimates within the revenue recognition process than required under existing US GAAP, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to separate performance obligations. The new standard is also expected to significantly increase the financial statement disclosure related to revenue recognition. This standard is currently effective for us on July 1, 2018 (the first quarter of our fiscal year ending June 30, 2019 (fiscal year 2019)) using one of two methods of adoption: (i) retrospective to each prior reporting period presented, with the option to elect certain practical expedients as defined within the standard; or (ii) modified retrospective with the cumulative effect of initially applying the standard recognized at the date of initial application inclusive of certain additional disclosures. We are continuing to evaluate the expected impact of this standard on our consolidated financial statements and we have not yet selected a method of adoption. While our assessment of the impact of this standard is not complete, we currently believe that the most significant impact will be in two specific areas: • Under the new standard, the absence of vendor specific objective evidence (VSOE) in certain software license arrangements will no longer result in strict revenue deferral, as instead fair value will be assigned to arrangement elements based on a fair value hierarchy no longer dependent on the presence of VSOE. Absent a change in how we license our products, we believe that this will result in greater up-front recognition of software revenue for certain of our license arrangements. • Under the new standard, certain expenses we incur will require deferral and recognition over the period in which revenue is recognized, subject to certain exceptions. We believe that this will result in the deferral of certain implementation and commission costs associated with our SaaS offerings which would then be recognized as expense over a multi-year period; such costs are expensed directly as incurred today. However, we are unable to quantify the impact of these outcomes at this time, nor can we ensure that our continuing analysis and interpretation of the standard will result in this financial reporting outcome. In January 2016, the FASB issued an accounting standard update which requires, among other things, that entities measure equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) at fair value, with changes in fair value recognized in earnings. Under the standard, entities will no longer be able to recognize unrealized holding gains and losses on equity securities classified today as available for sale as a component of other comprehensive income. For equity investments without readily determinable fair values, the cost method of accounting is also eliminated; however subject to certain exceptions, entities will be able to elect to record equity investments without readily determinable fair values at cost, less impairment and plus or minus adjustments for observable price changes, with all such changes recognized in earnings. This new standard does not change the guidance for classifying and measuring investments in debt securities and loans. The standard is effective for us on July 1, 2018 (the first quarter of fiscal year 2019) on a prospective basis. We are currently evaluating the anticipated impact of this standard on our financial statements. In February 2016, the FASB issued an accounting standard update which requires balance sheet recognition of a lease liability and a corresponding right-of-use asset, with an optional policy election for short-term leases (i.e. leases with a term of 12 months or less that do not include options to purchase the underlying lease assets that the lessee is reasonably certain to exercise) under which a right-of-use asset and lease liability would not be recognized and short-term lease payments would be expensed on a straight line basis over the term of the lease. The amendments to this accounting standard also require new financial statement disclosures. This standard is effective for us on July 1, 2019 (the first quarter of the fiscal year ending June 30, 2020) with early adoption permitted; adoption is on a modified retrospective basis. We anticipate that upon adoption this standard will have a material impact to our consolidated balance sheet due to the recognition of right of use assets and lease liabilities; however we are still evaluating the anticipated impact of this standard on our financial statements. In March 2016, the FASB issued an accounting standard update intended to simplify several areas of accounting for share-based compensation arrangements, including the income tax impact of excess tax benefits and tax deficiencies, accounting for forfeitures, statutory tax withholding requirements and the presentation of excess tax benefits in the statement of cash flows. This standard is effective for us on July 1, 2017 (the first quarter of the fiscal year ending June 30, 2018) with early adoption permitted. We are currently evaluating the anticipated impact of this standard on our financial statements. In June 2016, the FASB issued an accounting standard update that introduces a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments including trade receivables. The estimate of expected credit losses will require entities to incorporate historical information, current information and reasonable and supportable forecasts. This standard also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses. This standard is effective for us on July 1, 2020 (the first quarter of the fiscal year ending June 30, 2021) with early application permitted. We are currently evaluating the anticipated impact of this standard on our financial statements. In August 2016, the FASB issued an accounting standard update that provides guidance on how certain cash receipts and payments are presented and classified in the statement of cash flows. The standard is intended to reduce current diversity in practice. The standard is effective for us on July 1, 2018 and requires a retrospective approach. Early adoption is permitted, including adoption in an interim period. We are currently evaluating the anticipated impact of this standard on our financial statements. |
Fair Value
Fair Value | 3 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Note 3—Fair Value Fair Values of Assets and Liabilities We measure fair value at the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the assumptions that market participants would use in pricing an asset or liability (the inputs) are based on a tiered fair value hierarchy consisting of three levels, as follows: Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets. Level 2: Other inputs that are observable directly or indirectly, such as quoted prices for similar instruments in active markets or for similar markets that are not active. Level 3: Unobservable inputs for which there is little or no market data and which require us to develop our own assumptions about how market participants would price the asset or liability. Valuation techniques for assets and liabilities include methodologies such as the market approach, the income approach or the cost approach, and may use unobservable inputs such as projections, estimates and management’s interpretation of current market data. These unobservable inputs are only utilized to the extent that observable inputs are not available or cost-effective to obtain. At September 30, 2016 and June 30, 2016, our assets and liabilities measured at fair value on a recurring basis were as follows: September 30, 2016 June 30, 2016 Fair Value Measurements Using Input Types Fair Value Measurements Using (in thousands) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Money market funds (cash and cash equivalents) $ 235 $ — $ — $ 235 $ 117 $ — $ — $ 117 Available for sale securities Debt US Corporate $ 10,888 — — $ 10,888 $ 9,580 — — $ 9,580 Residential mortgage-backed 7,607 — — 7,607 9,604 — — 9,604 Government - US 10,621 — — 10,621 15,962 — — 15,962 Total available for sale securities $ 29,116 $ — $ — $ 29,116 $ 35,146 $ — $ — $ 35,146 Fair Value of Financial Instruments We have certain financial instruments which consist of cash and cash equivalents, marketable securities, accounts receivable, accounts payable and convertible senior notes (the Notes) more fully described in Note 10. Fair value information for each of these instruments is as follows: • Cash and cash equivalents, accounts receivable and accounts payable fair value approximates their carrying values, due to the short-term nature of these instruments. • Marketable securities classified as held to maturity are recorded at amortized cost, which at September 30, 2016 and June 30, 2016, approximated fair value. • Marketable securities classified as available for sale are recorded at fair value. Unrealized gains and losses are included as a component of other accumulated comprehensive loss in shareholders’ equity, net of tax. We use the specific identification method to determine any realized gains or losses from the sale of our marketable securities classified as available for sale. • The carrying value of assets ($1.5 million and $1.4 million) related to deposits we have made to fund future requirements associated with Israeli severance arrangements approximated their fair value at September 30, 2016 and June 30, 2016, respectively. • We have certain other investments accounted for at cost. The carrying value of these investments was $7.7 million at both September 30, 2016 and June 30, 2016 and they are reported as a component of our other assets. These investments are recorded at cost less any write-downs for other-than-temporary impairment charges. To determine the fair value of these investments, we use all available financial information including information based on recent or pending third-party equity investments in these entities. In certain instances, a cost method investment’s fair value may not be estimated if there are no identified events or changes in circumstances that would indicate a significant adverse effect on the fair value of the investment and to do so would be impractical. • The Notes were recorded at $133.3 million upon issuance, which reflected their principal value less the fair value of the embedded conversion option (Conversion Feature). The carrying value (net of debt issuance costs) of the Notes, $173.2 million at September 30, 2016, will be accreted over the remaining term to maturity to their principal value of $189.8 million. The fair value of the Notes (inclusive of the Conversion Feature) was approximately $194.0 million as of September 30, 2016. We estimated the fair value of the Notes by reference to quoted market prices; however the Notes have only a limited trading volume and as such this fair value estimate is not necessarily the value at which the Notes could be retired or transferred. Marketable Securities The table below presents information regarding our marketable securities by major security type as of September 30, 2016 and June 30, 2016. September 30, 2016 June 30, 2016 Held to Maturity Available for Sale Total Held to Available for Sale Total (in thousands) Marketable securities: Corporate and other debt securities 66 29,116 29,182 63 35,146 35,209 Total marketable securities $ 66 $ 29,116 $ 29,182 $ 63 $ 35,146 $ 35,209 The following table summarizes the estimated fair value of our investments in available for sale marketable securities classified by the contractual maturity date of the securities: September 30, 2016 (in thousands) Due within 1 year $ 13,848 Due in 1 year through 5 years $ 15,268 Total $ 29,116 All of our available for sale marketable securities are included in current assets as we do not have the positive intent to hold these investments until maturity. The following table presents the aggregate fair values and gross unrealized losses for those available for sale investments that were in an unrealized loss position as of September 30, 2016, aggregated by investment category and the length of time that individual securities have been in a continuous loss position: At September 30, 2016 Less than 12 Months Fair Value Unrealized Loss (in thousands) US Corporate $ 8,752 $ 7 Residential mortgage-backed $ 3,458 $ 5 Government—US $ 498 $ — Total $ 12,708 $ 12 |
Other Investments
Other Investments | 3 Months Ended |
Sep. 30, 2016 | |
Schedule of Investments [Abstract] | |
Other Investments | Note 4 – Other Investments In December 2015, we made a $3.5 million investment in preferred stock of a privately held, early-stage technology company. We have the ability to exercise significant influence over this company; however, we have no ability to exert control. Investments in common stock or in-substance common stock, through which an investor has the ability to exercise significant influence over the operating or financial policies of the investee, are accounted for under the equity method of accounting. In-substance common stock is an investment that has risk and reward characteristics that are substantially similar to an entity’s common stock. The preferred stock underlying our investment is not in-substance common stock as its terms include a substantive liquidation preference not available to common stockholders. Accordingly, we accounted for our investment under the cost method of accounting, subject to periodic review for impairment. Impairment losses, to the extent occurring, would be recorded as an operating expense in the period incurred. Our maximum exposure, which is determined based on the cost of our investment, is $3.5 million as of September 30, 2016. There were no indicators of impairment identified as of September 30, 2016. We concluded that this company is a variable interest entity (VIE) as it lacks sufficient equity to finance its activities. However, we also concluded that we are not the primary beneficiary of the VIE as we do not have the power to exert control or direct the activities that most significantly impact the VIE’s economic performance. As we have determined we are not the primary beneficiary, consolidation of the VIE is not required. |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Note 5—Net Loss Per Share The following table sets forth the computation of basic and diluted net loss per share: Three Months Ended September 30, 2016 2015 (in thousands except per share data) Numerator - basic and diluted: Net loss $ (10,508 ) $ (4,253 ) Denominator: Shares used in computing basic and diluted net loss per share attributable to common stockholders 37,940 38,004 Basic and diluted net loss per share attributable to common stockholders $ (0.28 ) $ (0.11 ) For the three months ended September 30, 2016 and September 30, 2015, approximately 3.3 million and 3.1 million shares of unvested restricted stock and stock options, respectively, were excluded from the calculation of diluted earnings per share as their effect on the calculation would have been anti-dilutive. As more fully discussed in Note 10, in December 2012 we issued the Notes maturing in December 2017. We intend, upon conversion or maturity of the Notes, to satisfy any conversion premium by issuing shares of our common stock. We have also issued warrants for up to 6.3 million shares of our common stock at an exercise price of $40.04 per share. For the quarter ended September 30, 2016, shares potentially issuable upon conversion or maturity of the Notes or upon exercise of the warrants were excluded from our earnings per share calculations as their effect would have been anti-dilutive. |
Operations by Segments and Geog
Operations by Segments and Geographic Areas | 3 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Operations by Segments and Geographic Areas | Note 6—Operations by Segments and Geographic Areas Segment Information Operating segments are the components of our business for which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Our chief operating decision maker is our chief executive officer. Our operating segments are organized principally by the type of product or service offered and by geography. During the fiscal year ended June 30, 2016 (fiscal year 2016), we re-examined the aggregation of our operating segments and reclassified our cyber fraud and risk management and healthcare operating segments from the “Payments and Transactional Documents” reportable segment into the new “Other” reportable segment. To ensure a consistent presentation of the measurement of segment revenues and profit or loss, these changes are reflected for all periods presented. Similar operating segments have been aggregated into four reportable segments as follows: Payments and Transactional Documents. Hosted Solutions. Digital Banking. Other Periodically a sales person in one operating segment will sell products and services that are typically sold within a different operating segment. In such cases, the transaction is generally recorded by the operating segment to which the sales person is assigned. Accordingly, segment results can include the results of transactions that have been allocated to a specific segment based on the contributing sales resources, rather than the nature of the product or service. Conversely, a transaction can be recorded by the operating segment primarily responsible for delivery to the customer, even if the sales person is assigned to a different operating segment. Our chief operating decision maker assesses segment performance based on a variety of factors that normally include segment revenue and a segment measure of profit or loss. Each segment’s measure of profit or loss is on a pre-tax basis and excludes stock compensation expense, acquisition and integration related expenses (including acquisition related contingent consideration), amortization of acquired intangible assets, restructuring related charges, minimum pension liability adjustments, non-core charges related to our convertible notes, global enterprise resource planning (ERP) system implementation costs, charges related to reserves established or released against our deferred tax assets and other non-core or non-recurring gains and losses that arise from time to time. There are no inter-segment sales; accordingly, the measure of segment revenue and profit or loss reflects only revenues from external customers. The costs of certain corporate level expenses, primarily general and administrative expenses, are allocated to our operating segments based on a percentage of the segment’s revenues. We do not track or assign our assets by operating segment. Segment information for the three months ended September 30, 2016 and 2015 according to the segment descriptions above, is as follows: Three Months Ended September 30, 2016 2015 (in thousands) Segment revenue: Payments and Transactional Documents $ 24,846 $ 27,416 Hosted Solutions 35,557 33,870 Digital Banking 18,186 17,331 Other 4,495 4,264 Total segment revenue $ 83,084 $ 82,881 Segment measure of profit (loss): Payments and Transactional Documents $ 7,576 $ 7,790 Hosted Solutions 5,453 6,574 Digital Banking 25 1,863 Other (445 ) (908 ) Total measure of segment profit $ 12,609 $ 15,319 A reconciliation of the measure of segment profit to GAAP loss before income taxes is as follows: Three Months Ended September 30, 2016 2015 (in thousands) Total measure of segment profit $ 12,609 $ 15,319 Less: Amortization of acquired intangible assets (6,285 ) (7,279 ) Stock-based compensation expense (8,199 ) (7,588 ) Acquisition and integration related expenses (1,249 ) (110 ) Restructuring expenses — (20 ) Minimum pension liability and related adjustments (277 ) (36 ) Global ERP system implementation costs (2,491 ) (257 ) Other expense, net (3,935 ) (3,671 ) Loss before income taxes $ (9,827 ) $ (3,642 ) The following depreciation expense amounts are included in the segment measure of profit: Three Months Ended September 30, 2016 2015 (in thousands) Depreciation and other amortization expense: Payments and Transactional Documents $ 805 $ 692 Hosted Solutions 1,840 1,424 Digital Banking 1,370 858 Other 72 103 Total depreciation and other amortization expense $ 4,087 $ 3,077 Geographic Information We have presented geographic information about our revenues below. This presentation allocates revenue based on the point of sale, not the location of the customer. Accordingly, we derive revenues from geographic locations based on the location of the customer that would vary from the geographic areas listed here; particularly in respect of financial institution customers located in Australia for which the point of sale was North America. Three Months Ended September 30, 2016 2015 (in thousands) North America $ 50,522 $ 48,596 United Kingdom 20,831 22,832 Continental Europe 9,352 9,452 Asia-Pacific and Middle East 2,379 2,001 Total revenues from unaffiliated customers $ 83,084 $ 82,881 Long-lived assets, excluding deferred tax assets and intangible assets, which are based on geographical location, were as follows: September 30, June 30, 2016 2016 (in thousands) Long-lived assets: North America $ 57,821 $ 55,208 United Kingdom 8,346 8,499 Continental Europe 1,980 1,924 Asia-Pacific and Middle East 2,109 2,080 Total long-lived assets $ 70,256 $ 67,711 |
Income Taxes
Income Taxes | 3 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 7—Income Taxes The income tax expense we record in any interim period is based on our estimated effective tax rate for the fiscal year in those tax jurisdictions in which we can reliably estimate our effective tax rate. The calculation of our estimated effective tax rate requires an estimate of pre-tax income by tax jurisdiction, as well as total tax expense for the fiscal year. Accordingly, this tax rate is subject to adjustment if, in subsequent interim periods, there are changes to our initial estimates of total tax expense or pre-tax income, including income by jurisdiction. For those tax jurisdictions for which we are unable to reliably estimate an overall effective tax rate, we calculate income tax expense based upon the actual effective tax rate for the year-to-date period. We recorded income tax expense of $0.7 million and $0.6 million for the three months ended September 30, 2016 and 2015, respectively. The income tax expense for the three months ended September 30, 2016 was principally due to tax expense associated with our US and UK operations, offset in part by a tax benefit associated with our Swiss and Israeli operations. Our tax expense for the three months ended September 30, 2016 was offset in part by a discrete tax benefit of approximately $0.1 million from the enactment of legislation that decreased UK income tax rates. The US income tax expense was principally due to an increase in deferred tax liabilities for goodwill that is deductible for tax purposes but not amortized for financial reporting purposes. The income tax expense for the three months ended September 30, 2015 was principally due to tax expense associated with our US and UK operations, offset in part by a tax benefit associated with our Swiss and Israeli operations. We currently anticipate that our unrecognized tax benefits will decrease within the next twelve months by approximately $0.3 million as a result of the expiration of certain statutes of limitations associated with intercompany transactions subject to tax in multiple jurisdictions. We record a deferred tax asset if we believe that it is more likely than not that we will realize a future tax benefit. Ultimate realization of any deferred tax asset is dependent on our ability to generate sufficient future taxable income in the appropriate tax jurisdiction before the expiration of carryforward periods, if any. Our assessment of deferred tax asset recoverability considers many different factors including historical and projected operating results, the reversal of existing deferred tax liabilities that provide a source of future taxable income, the impact of current tax planning strategies and the availability of future tax planning strategies. We establish a valuation allowance against any deferred tax asset for which we are unable to conclude that recoverability is more likely than not. This is inherently judgmental, since we are required to assess many different factors and evaluate as much objective evidence as we can in reaching an overall conclusion. The particularly sensitive component of our evaluation is our projection of future operating results since this relies heavily on our estimates of future revenue and expense levels by tax jurisdiction. At September 30, 2016 we have recorded a $29.5 million valuation allowance against certain deferred tax assets given the uncertainty of recoverability of these amounts. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Note 8—Goodwill and Other Intangible Assets The following tables set forth the information for intangible assets subject to amortization and for intangible assets not subject to amortization. As of September 30, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Value Weighted Average Remaining Life (in thousands) (in years) Amortized intangible assets: Customer related $ 190,220 $ (113,157 ) $ 77,063 9.4 Core technology 130,347 (67,003 ) 63,344 9.3 Other intangible assets 20,521 (13,928 ) 6,593 6.1 Capitalized software development costs 13,716 (1,735 ) 11,981 5.8 Total $ 354,804 $ (195,823 ) $ 158,981 Unamortized intangible assets: Goodwill 201,489 Total intangible assets $ 360,470 As of June 30, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Value Weighted Average Remaining Life (in thousands) (in years) Amortized intangible assets: Customer related $ 190,549 $ (110,356 ) $ 80,193 9.6 Core technology 130,434 (64,591 ) 65,843 9.5 Other intangible assets 20,469 (13,320 ) 7,149 6.1 Capitalized software development costs 12,993 (1,248 ) 11,745 6.0 Total $ 354,445 $ (189,515 ) $ 164,930 Unamortized intangible assets: Goodwill 202,028 Total intangible assets $ 366,958 Estimated amortization expense for fiscal year 2017 and subsequent fiscal years for acquired intangible assets is as follows: (in thousands) 2017 $ 24,452 2018 20,550 2019 18,607 2020 16,523 2021 14,964 2022 and thereafter 58,189 Estimated amortization expense for fiscal year 2017 and subsequent fiscal years for capitalized software development costs using a straight-line methodology is stated below. Each period we evaluate whether amortization expense using a ratio of revenue in the period to total expected revenue over the product’s expected useful life would result in greater amortization than as calculated under a straight-line methodology and, if that were to occur, amortization in that period would be accelerated accordingly. (in thousands) 2017 $ 2,035 2018 2,087 2019 2,087 2020 2,087 2021 2,086 2022 and thereafter 2,086 The following table represents a rollforward of our goodwill balances, by reportable segment, as follows: Payments and Hosted Digital Other Total (in thousands) Balance at June 30, 2016 $ 60,852 $ 89,573 $ 35,880 $ 15,723 $ 202,028 Impact of foreign currency translation (387 ) (152 ) — — (539 ) Balance at September 30, 2016 $ 60,465 $ 89,421 $ 35,880 $ 15,723 $ 201,489 We perform an impairment test for goodwill during the fourth quarter each fiscal year. Based on our most recent impairment testing, during the fourth quarter of the year ended June 30, 2016, the excess of fair value over the carrying value of our Intellinx reporting unit was 14%. Given the relatively narrow excess of fair value over carrying value, we believe that this reporting unit remains at a heightened risk of impairment. The carrying value of goodwill in the Intellinx reporting unit was $12.0 million at September 30, 2016. There can be no assurance that there will not be impairment charges in future periods as a result of future impairment reviews. To the extent that future impairment charges occur it would have a material impact on our financial results. At September 30, 2016, the carrying value of goodwill for all of our reporting units was $201.5 million. |
Contingencies
Contingencies | 3 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Note 9—Contingencies During fiscal year 2016, we agreed to indemnify a customer against costs it may incur as a result of a lawsuit filed against them for alleged patent infringement related to certain technology licensed from us, which we license and resell from an outside supplier. We in turn received indemnification from the outside supplier. Bottomline was not named as a party to this lawsuit. In September 2016, we were notified by the supplier that the litigation had been resolved. We were not a party to the settlement, and neither we nor our customer incurred any monetary or other damages in connection therewith. We are, from time to time, a party to legal proceedings and claims that arise out of the ordinary course of our business. We are not currently a party to any material legal proceedings. |
Convertible Senior Notes
Convertible Senior Notes | 3 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | Note 10 Convertible Senior Notes On December 12, 2012, we issued $189.8 million aggregate principal amount of our 1.50% Convertible Senior Notes maturing on December 1, 2017 (the Notes), inclusive of the underwriters’ exercise in full of their over-allotment option of $24.8 million. Cash interest at a rate of 1.50% per year began to accrue on December 12, 2012 and is payable semi-annually on June 1 and December 1 of each year beginning on June 1, 2013. We received net proceeds from the offering of approximately $167.3 million after adjusting for debt issue costs, including the underwriting discount, and the net cash used to purchase the Note Hedges and sell the Warrants which are discussed below. The Notes were issued under an indenture dated December 12, 2012 (the “Base Indenture”) by and between us and The Bank of New York Mellon Trust Company, N.A., as Trustee and a First Supplemental Indenture dated December 12, 2012 (the “First Supplemental Indenture”) by and between us and the Trustee (the Base Indenture and the First Supplemental Indenture are collectively referred to as the “Indenture”). There are no financial or operating covenants relating to the Notes. The Notes are senior unsecured obligations of ours and rank senior in right of payment to any future unsecured indebtedness that is expressly subordinated in right of payment to the Notes, and equal in right of payment to any of our existing and future unsecured indebtedness that is not subordinated. The Notes are effectively junior in right of payment to any of our secured indebtedness (to the extent of the value of assets securing such indebtedness) and structurally junior to all existing and future indebtedness and other liabilities, including trade payables, of our subsidiaries. Prior to this offering, neither we nor our subsidiaries had any outstanding indebtedness for borrowed money. The Indenture does not limit the amount of debt that we or our subsidiaries may incur. The Notes are not guaranteed by us or any of our subsidiaries. Holders may convert their Notes at their option, prior to the close of business on the business day immediately preceding June 1, 2017, in multiples of $1,000 principal amount, only under the following circumstances: • during any calendar quarter commencing after the calendar quarter ending on March 31, 2013 (and only during such calendar quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; • during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of the convertible notes for each trading day of the measurement period was less than 98% of the product of the last reported sales price of our common stock and the conversion rate on each trading day; or • upon the occurrence of specified corporate events, including a merger or a sale of all or substantially all of our assets. On or after June 1, 2017 and until the close of business on the second scheduled trading day immediately preceding the maturity date of December 1, 2017, holders may convert their Notes, in multiples of $1,000 principal amount, at the option of the holder regardless of the foregoing circumstances. The conversion rate for the Notes is initially 33.3042 shares per $1,000 principal amount of Notes (equivalent to an initial conversion price of approximately $30.03 per share of our common stock). The conversion rate is subject to customary adjustment for certain events as described in the Indenture. The principal balance of the Notes is always required to be settled in cash. However, we are permitted at our election to settle any conversion obligation in excess of the principal portion in cash, shares of our common stock, or a combination of cash and shares of our common stock. We may not redeem the Notes prior to their maturity date. If we undergo a fundamental change (as described in the Indenture), subject to certain conditions, holders may require us to repurchase for cash all or part of their Notes in principal amounts of $1,000 or an integral multiple thereof. The fundamental change repurchase price will be equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. The Indenture contains customary events of default with respect to the Notes and provides that upon certain events of default occurring and continuing, the Trustee may, and the Trustee at the request of such holders of at least 25% in principal amount of the convertible notes shall, declare 100% of the principal of and accrued and unpaid interest, if any, on the Notes to be due and payable. In case of certain events of bankruptcy, insolvency or reorganization, involving us or a significant subsidiary, 100% of the principal of and accrued and unpaid interest on the Notes will automatically become due and payable. Upon such a declaration of acceleration, such principal and accrued and unpaid interest, if any, will be due and payable immediately. Under limited circumstances, we may be required to pay contingent interest on the Notes as a result of failure to comply with the reporting obligations in the Indenture or failure to file required Securities and Exchange Commission documents and reports. When applicable, the contingent interest payable per $1,000 principal amount is 0.25% per annum over the applicable term as provided under the Indenture. The contingent interest features of the Notes are embedded derivative instruments. The estimated fair value of the contingent interest features of the Notes was zero at issuance and at September 30, 2016, as the likelihood of any liability being incurred under these provisions was deemed remote and, to the extent occurring, the time period during which a contingent interest charge would apply is projected to be short. The Notes were recorded upon issuance using a residual method of valuation, meaning since the Conversion Feature was initially a derivative instrument recorded at fair value, we allocated debt proceeds to the Conversion Feature based on the fair value of that instrument and the residual proceeds were allocated to the Notes. The carrying amount of the Notes will be accreted to the principal amount over the remaining term to maturity and we will record a corresponding charge to interest expense. The net carrying amount of the Notes at September 30, 2016 was as follows: (in thousands) Principal amount $ 189,750 Unamortized debt issuance costs (1,381 ) Unamortized discount (15,140 ) Net carrying value $ 173,229 We incurred certain third party costs in connection with our issuance of the Notes, principally related to underwriting and legal fees, which are being amortized to interest expense ratably over the five-year term of the Notes. The following table sets forth total interest expense related to the Notes: Three Months Ended September 30, 2016 2015 (in thousands) Contractual interest expense (cash) $ 712 $ 712 Amortization of debt discount (non-cash) 3,076 2,865 Amortization of debt issue costs (non-cash) 296 296 $ 4,084 $ 3,873 Effective interest rate of the liability component 7.99 % 7.54 % Note Hedges In December 2012, we entered into privately negotiated transactions to purchase hedge instruments (the Note Hedges), covering approximately 6.3 million shares of our common stock. The Note Hedges are subject to anti-dilution provisions substantially similar to those of the Notes, have a strike price that corresponds to the conversion price of the Notes, are exercisable by us upon any conversion under the Notes and expire on December 1, 2017. The Note Hedges are generally expected to reduce the potential dilution to our common stock (or, in the event the Conversion Feature is settled in cash, to reduce our cash payment obligation) in the event that at the time of conversion our stock price exceeds the conversion price under the Notes. The cost of the Note Hedges, $42.3 million, is expected to be tax deductible as an original issue discount over the life of the Notes, as the Notes and the Note Hedges represent an integrated debt instrument for tax purposes. The Note Hedges are transactions that are separate from the terms of the Notes and the Warrants (discussed below), and holders of the Notes and the Warrants have no rights with respect to the Note Hedges. Warrants In December 2012, we received aggregate proceeds of $25.8 million, net of issue costs, from the sale of warrants (the Warrants), for the purchase of up to 6.3 million shares of our common stock, subject to antidilution adjustments, at a strike price of $40.04 per share. The Warrants are exercisable in equal tranches over a period of 150 days beginning on March 1, 2018, and ending on October 18, 2018. The Warrants are transactions that are separate from the terms of the Notes and the Note Hedges, and holders of the Notes and Note Hedges have no rights with respect to the Warrants. |
Derivative Instruments
Derivative Instruments | 3 Months Ended |
Sep. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Note 11—Derivative Instruments Our derivative instruments for the quarter ended September 30, 2016 consisted of the Note Hedges, Conversion Feature and Warrants as discussed in Note 10. As of September 30, 2016, each of these instruments continued to meet the classification requirements for inclusion within stockholders’ equity and as such they were not subject to fair value re-measurement. We are required, for the remaining term of the Notes, to assess whether we continue to meet the stockholders’ equity classification requirements. If in any future period we failed to satisfy those requirements, we would be required to reclassify the derivative instruments out of stockholders’ equity, to either assets or liabilities depending on their nature, and record those instruments at fair value with changes in fair value reflected in earnings. |
Postretirement and Other Employ
Postretirement and Other Employee Benefits | 3 Months Ended |
Sep. 30, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Postretirement and Other Employee Benefits | Note 12—Postretirement and Other Employee Benefits Defined Benefit Pension Plan We sponsor a retirement plan for our Swiss-based employees that is governed by local regulatory requirements. This plan includes certain minimum benefit guarantees that, under US GAAP, require defined benefit plan accounting. Net periodic pension costs for the Swiss pension plan include the following components: Three Months Ended September 30, 2016 2015 (in thousands) Components of net periodic cost Service cost $ 750 $ 578 Interest cost 32 123 Prior service credit (23 ) (23 ) Net actuarial loss 165 18 Expected return on plan assets (224 ) (204 ) Net periodic cost $ 700 $ 492 |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals and adjustments) considered necessary for a fair presentation of the interim financial information have been included. Operating results for the three months ended September 30, 2016, are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending June 30, 2017 (fiscal year 2017). For further information, refer to the financial statements and footnotes included in the Annual Report on Form 10-K as filed with the Securities and Exchange Commission (SEC) on August 29, 2016. |
Recently Adopted Pronouncements | Recently Adopted Pronouncements In June 2014, the Financial Accounting Standards Board (FASB) issued an accounting standard update which eliminated the definition of a development stage entity and the financial reporting requirements specific to development stage entities. The update also eliminated an exception that previously existed in the consolidation accounting standard for determining whether a development stage entity had sufficient equity at risk and therefore was a variable interest entity (VIE). We adopted this standard effective July 1, 2016. Upon adoption, we were required to re-assess whether one of the entities in which we have an equity investment is a VIE. Based on the re-assessment, we concluded that this entity is a VIE, but that we are not the primary beneficiary (the primary beneficiary of a VIE is required to consolidate the VIE). Accordingly, the adoption of this standard did not have a material impact on our financial statements. In August 2014, the FASB issued an accounting standard update which requires management to evaluate, at each annual or interim reporting period, whether there are conditions or events that exist that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. We adopted this standard on July 1, 2016. The adoption of this standard did not have a material impact on our financial statements. In April 2015, the FASB issued an accounting standard update which requires that debt issuance costs be presented in the balance sheet as a direct reduction to the carrying value of the debt. We retrospectively adopted this standard effective July 1, 2016 and reclassified debt issuance costs from non-current assets to convertible senior notes in our consolidated balance sheets in all periods presented. Deferred debt issuance costs were approximately $1.4 million at September 30, 2016 and $1.7 million at June 30, 2016. In April 2015, the FASB issued an accounting standard update which provides guidance as to whether a cloud computing arrangement (e.g., software as a service, platform as a service, infrastructure as a service, and other similar arrangements) includes a software license, and based on that determination, how to account for such arrangements. We adopted this standard effective July 1, 2016 on a prospective basis. The adoption of this standard did not have a material impact on our financial statements. In November 2015, the FASB issued an accounting standard update which requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent in the balance sheet. As a result, each separate tax jurisdiction will have one net tax position, either a noncurrent deferred tax asset or a noncurrent deferred tax liability. The standard is effective for us on July 1, 2017, with early adoption permitted. We elected to adopt this standard as of July 1, 2016 on a prospective basis. If we had adopted the standard retrospectively, the impact would have resulted in a $6.2 million reduction to current deferred tax assets and noncurrent deferred tax liabilities in our June 30, 2016 balance sheet. The adoption of this standard did not have an impact on our statements of comprehensive loss or cash flows. Recent Accounting Pronouncements In May 2014, the FASB issued an accounting standard update which provides for new revenue recognition guidance, superseding nearly all existing revenue recognition guidance. The core principle of the new guidance is to recognize revenue when promised goods or services are transferred to customers, in an amount that reflects the consideration to which the vendor expects to receive for those goods or services. The new standard is expected to require more judgment and estimates within the revenue recognition process than required under existing US GAAP, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to separate performance obligations. The new standard is also expected to significantly increase the financial statement disclosure related to revenue recognition. This standard is currently effective for us on July 1, 2018 (the first quarter of our fiscal year ending June 30, 2019 (fiscal year 2019)) using one of two methods of adoption: (i) retrospective to each prior reporting period presented, with the option to elect certain practical expedients as defined within the standard; or (ii) modified retrospective with the cumulative effect of initially applying the standard recognized at the date of initial application inclusive of certain additional disclosures. We are continuing to evaluate the expected impact of this standard on our consolidated financial statements and we have not yet selected a method of adoption. While our assessment of the impact of this standard is not complete, we currently believe that the most significant impact will be in two specific areas: • Under the new standard, the absence of vendor specific objective evidence (VSOE) in certain software license arrangements will no longer result in strict revenue deferral, as instead fair value will be assigned to arrangement elements based on a fair value hierarchy no longer dependent on the presence of VSOE. Absent a change in how we license our products, we believe that this will result in greater up-front recognition of software revenue for certain of our license arrangements. • Under the new standard, certain expenses we incur will require deferral and recognition over the period in which revenue is recognized, subject to certain exceptions. We believe that this will result in the deferral of certain implementation and commission costs associated with our SaaS offerings which would then be recognized as expense over a multi-year period; such costs are expensed directly as incurred today. However, we are unable to quantify the impact of these outcomes at this time, nor can we ensure that our continuing analysis and interpretation of the standard will result in this financial reporting outcome. In January 2016, the FASB issued an accounting standard update which requires, among other things, that entities measure equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) at fair value, with changes in fair value recognized in earnings. Under the standard, entities will no longer be able to recognize unrealized holding gains and losses on equity securities classified today as available for sale as a component of other comprehensive income. For equity investments without readily determinable fair values, the cost method of accounting is also eliminated; however subject to certain exceptions, entities will be able to elect to record equity investments without readily determinable fair values at cost, less impairment and plus or minus adjustments for observable price changes, with all such changes recognized in earnings. This new standard does not change the guidance for classifying and measuring investments in debt securities and loans. The standard is effective for us on July 1, 2018 (the first quarter of fiscal year 2019) on a prospective basis. We are currently evaluating the anticipated impact of this standard on our financial statements. In February 2016, the FASB issued an accounting standard update which requires balance sheet recognition of a lease liability and a corresponding right-of-use asset, with an optional policy election for short-term leases (i.e. leases with a term of 12 months or less that do not include options to purchase the underlying lease assets that the lessee is reasonably certain to exercise) under which a right-of-use asset and lease liability would not be recognized and short-term lease payments would be expensed on a straight line basis over the term of the lease. The amendments to this accounting standard also require new financial statement disclosures. This standard is effective for us on July 1, 2019 (the first quarter of the fiscal year ending June 30, 2020) with early adoption permitted; adoption is on a modified retrospective basis. We anticipate that upon adoption this standard will have a material impact to our consolidated balance sheet due to the recognition of right of use assets and lease liabilities; however we are still evaluating the anticipated impact of this standard on our financial statements. In March 2016, the FASB issued an accounting standard update intended to simplify several areas of accounting for share-based compensation arrangements, including the income tax impact of excess tax benefits and tax deficiencies, accounting for forfeitures, statutory tax withholding requirements and the presentation of excess tax benefits in the statement of cash flows. This standard is effective for us on July 1, 2017 (the first quarter of the fiscal year ending June 30, 2018) with early adoption permitted. We are currently evaluating the anticipated impact of this standard on our financial statements. In June 2016, the FASB issued an accounting standard update that introduces a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments including trade receivables. The estimate of expected credit losses will require entities to incorporate historical information, current information and reasonable and supportable forecasts. This standard also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses. This standard is effective for us on July 1, 2020 (the first quarter of the fiscal year ending June 30, 2021) with early application permitted. We are currently evaluating the anticipated impact of this standard on our financial statements. In August 2016, the FASB issued an accounting standard update that provides guidance on how certain cash receipts and payments are presented and classified in the statement of cash flows. The standard is intended to reduce current diversity in practice. The standard is effective for us on July 1, 2018 and requires a retrospective approach. Early adoption is permitted, including adoption in an interim period. We are currently evaluating the anticipated impact of this standard on our financial statements. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments We have certain financial instruments which consist of cash and cash equivalents, marketable securities, accounts receivable, accounts payable and convertible senior notes (the Notes) more fully described in Note 10. Fair value information for each of these instruments is as follows: • Cash and cash equivalents, accounts receivable and accounts payable fair value approximates their carrying values, due to the short-term nature of these instruments. • Marketable securities classified as held to maturity are recorded at amortized cost, which at September 30, 2016 and June 30, 2016, approximated fair value. • Marketable securities classified as available for sale are recorded at fair value. Unrealized gains and losses are included as a component of other accumulated comprehensive loss in shareholders’ equity, net of tax. We use the specific identification method to determine any realized gains or losses from the sale of our marketable securities classified as available for sale. • The carrying value of assets ($1.5 million and $1.4 million) related to deposits we have made to fund future requirements associated with Israeli severance arrangements approximated their fair value at September 30, 2016 and June 30, 2016, respectively. • We have certain other investments accounted for at cost. The carrying value of these investments was $7.7 million at both September 30, 2016 and June 30, 2016 and they are reported as a component of our other assets. These investments are recorded at cost less any write-downs for other-than-temporary impairment charges. To determine the fair value of these investments, we use all available financial information including information based on recent or pending third-party equity investments in these entities. In certain instances, a cost method investment’s fair value may not be estimated if there are no identified events or changes in circumstances that would indicate a significant adverse effect on the fair value of the investment and to do so would be impractical. • The Notes were recorded at $133.3 million upon issuance, which reflected their principal value less the fair value of the embedded conversion option (Conversion Feature). The carrying value (net of debt issuance costs) of the Notes, $173.2 million at September 30, 2016, will be accreted over the remaining term to maturity to their principal value of $189.8 million. The fair value of the Notes (inclusive of the Conversion Feature) was approximately $194.0 million as of September 30, 2016. We estimated the fair value of the Notes by reference to quoted market prices; however the Notes have only a limited trading volume and as such this fair value estimate is not necessarily the value at which the Notes could be retired or transferred. |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | At September 30, 2016 and June 30, 2016, our assets and liabilities measured at fair value on a recurring basis were as follows: September 30, 2016 June 30, 2016 Fair Value Measurements Using Input Types Fair Value Measurements Using (in thousands) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Money market funds (cash and cash equivalents) $ 235 $ — $ — $ 235 $ 117 $ — $ — $ 117 Available for sale securities Debt US Corporate $ 10,888 — — $ 10,888 $ 9,580 — — $ 9,580 Residential mortgage-backed 7,607 — — 7,607 9,604 — — 9,604 Government - US 10,621 — — 10,621 15,962 — — 15,962 Total available for sale securities $ 29,116 $ — $ — $ 29,116 $ 35,146 $ — $ — $ 35,146 |
Marketable Securities by Major Security Type | The table below presents information regarding our marketable securities by major security type as of September 30, 2016 and June 30, 2016. September 30, 2016 June 30, 2016 Held to Maturity Available for Sale Total Held to Available for Sale Total (in thousands) Marketable securities: Corporate and other debt securities 66 29,116 29,182 63 35,146 35,209 Total marketable securities $ 66 $ 29,116 $ 29,182 $ 63 $ 35,146 $ 35,209 |
Estimated Fair Value of Our Investments in Available for Sale Marketable Securities Classified | The following table summarizes the estimated fair value of our investments in available for sale marketable securities classified by the contractual maturity date of the securities: September 30, 2016 (in thousands) Due within 1 year $ 13,848 Due in 1 year through 5 years $ 15,268 Total $ 29,116 |
Summary of Gross Unrealized Losses and Fair Values of Available for Sale Investments | The following table presents the aggregate fair values and gross unrealized losses for those available for sale investments that were in an unrealized loss position as of September 30, 2016, aggregated by investment category and the length of time that individual securities have been in a continuous loss position: At September 30, 2016 Less than 12 Months Fair Value Unrealized Loss (in thousands) US Corporate $ 8,752 $ 7 Residential mortgage-backed $ 3,458 $ 5 Government—US $ 498 $ — Total $ 12,708 $ 12 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Net Loss Per Share | The following table sets forth the computation of basic and diluted net loss per share: Three Months Ended September 30, 2016 2015 (in thousands except per share data) Numerator - basic and diluted: Net loss $ (10,508 ) $ (4,253 ) Denominator: Shares used in computing basic and diluted net loss per share attributable to common stockholders 37,940 38,004 Basic and diluted net loss per share attributable to common stockholders $ (0.28 ) $ (0.11 ) |
Operations by Segments and Ge21
Operations by Segments and Geographic Areas (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | Segment information for the three months ended September 30, 2016 and 2015 according to the segment descriptions above, is as follows: Three Months Ended September 30, 2016 2015 (in thousands) Segment revenue: Payments and Transactional Documents $ 24,846 $ 27,416 Hosted Solutions 35,557 33,870 Digital Banking 18,186 17,331 Other 4,495 4,264 Total segment revenue $ 83,084 $ 82,881 Segment measure of profit (loss): Payments and Transactional Documents $ 7,576 $ 7,790 Hosted Solutions 5,453 6,574 Digital Banking 25 1,863 Other (445 ) (908 ) Total measure of segment profit $ 12,609 $ 15,319 |
Reconciliation of Measure of Segment Profit to GAAP Loss Before Income Taxes | A reconciliation of the measure of segment profit to GAAP loss before income taxes is as follows: Three Months Ended September 30, 2016 2015 (in thousands) Total measure of segment profit $ 12,609 $ 15,319 Less: Amortization of acquired intangible assets (6,285 ) (7,279 ) Stock-based compensation expense (8,199 ) (7,588 ) Acquisition and integration related expenses (1,249 ) (110 ) Restructuring expenses — (20 ) Minimum pension liability and related adjustments (277 ) (36 ) Global ERP system implementation costs (2,491 ) (257 ) Other expense, net (3,935 ) (3,671 ) Loss before income taxes $ (9,827 ) $ (3,642 ) |
Schedule of Segment Depreciation Expense Included in Segment Measure of Profit | The following depreciation expense amounts are included in the segment measure of profit: Three Months Ended September 30, 2016 2015 (in thousands) Depreciation and other amortization expense: Payments and Transactional Documents $ 805 $ 692 Hosted Solutions 1,840 1,424 Digital Banking 1,370 858 Other 72 103 Total depreciation and other amortization expense $ 4,087 $ 3,077 |
Schedule of Revenue Based on Point of Sale | We have presented geographic information about our revenues below. This presentation allocates revenue based on the point of sale, not the location of the customer. Accordingly, we derive revenues from geographic locations based on the location of the customer that would vary from the geographic areas listed here; particularly in respect of financial institution customers located in Australia for which the point of sale was North America. Three Months Ended September 30, 2016 2015 (in thousands) North America $ 50,522 $ 48,596 United Kingdom 20,831 22,832 Continental Europe 9,352 9,452 Asia-Pacific and Middle East 2,379 2,001 Total revenues from unaffiliated customers $ 83,084 $ 82,881 |
Schedule of Long-Lived Assets, Excluding Deferred Tax Assets and Intangible Assets, Based on Geographic Designation | Long-lived assets, excluding deferred tax assets and intangible assets, which are based on geographical location, were as follows: September 30, June 30, 2016 2016 (in thousands) Long-lived assets: North America $ 57,821 $ 55,208 United Kingdom 8,346 8,499 Continental Europe 1,980 1,924 Asia-Pacific and Middle East 2,109 2,080 Total long-lived assets $ 70,256 $ 67,711 |
Goodwill and Other Intangible22
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Schedule of Intangible Assets Subject to Amortization and for Intangible Assets Not Subject to Amortization | The following tables set forth the information for intangible assets subject to amortization and for intangible assets not subject to amortization. As of September 30, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Value Weighted Average Remaining Life (in thousands) (in years) Amortized intangible assets: Customer related $ 190,220 $ (113,157 ) $ 77,063 9.4 Core technology 130,347 (67,003 ) 63,344 9.3 Other intangible assets 20,521 (13,928 ) 6,593 6.1 Capitalized software development costs 13,716 (1,735 ) 11,981 5.8 Total $ 354,804 $ (195,823 ) $ 158,981 Unamortized intangible assets: Goodwill 201,489 Total intangible assets $ 360,470 As of June 30, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Value Weighted Average Remaining Life (in thousands) (in years) Amortized intangible assets: Customer related $ 190,549 $ (110,356 ) $ 80,193 9.6 Core technology 130,434 (64,591 ) 65,843 9.5 Other intangible assets 20,469 (13,320 ) 7,149 6.1 Capitalized software development costs 12,993 (1,248 ) 11,745 6.0 Total $ 354,445 $ (189,515 ) $ 164,930 Unamortized intangible assets: Goodwill 202,028 Total intangible assets $ 366,958 |
Schedule of Estimated Amortization Expense | Estimated amortization expense for fiscal year 2017 and subsequent fiscal years for acquired intangible assets is as follows: (in thousands) 2017 $ 24,452 2018 20,550 2019 18,607 2020 16,523 2021 14,964 2022 and thereafter 58,189 |
Schedule of Rollforward of Goodwill Balances, by Reportable Segment | The following table represents a rollforward of our goodwill balances, by reportable segment, as follows: Payments and Hosted Digital Other Total (in thousands) Balance at June 30, 2016 $ 60,852 $ 89,573 $ 35,880 $ 15,723 $ 202,028 Impact of foreign currency translation (387 ) (152 ) — — (539 ) Balance at September 30, 2016 $ 60,465 $ 89,421 $ 35,880 $ 15,723 $ 201,489 |
Software Developed Other Than For Internal Use [Member] | |
Schedule of Estimated Amortization Expense | Estimated amortization expense for fiscal year 2017 and subsequent fiscal years for capitalized software development costs using a straight-line methodology is stated below. (in thousands) 2017 $ 2,035 2018 2,087 2019 2,087 2020 2,087 2021 2,086 2022 and thereafter 2,086 |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Net Carrying Amount of Notes | The net carrying amount of the Notes at September 30, 2016 was as follows: (in thousands) Principal amount $ 189,750 Unamortized debt issuance costs (1,381 ) Unamortized discount (15,140 ) Net carrying value $ 173,229 |
Total Interest Expense Related to Notes | The following table sets forth total interest expense related to the Notes: Three Months Ended September 30, 2016 2015 (in thousands) Contractual interest expense (cash) $ 712 $ 712 Amortization of debt discount (non-cash) 3,076 2,865 Amortization of debt issue costs (non-cash) 296 296 $ 4,084 $ 3,873 Effective interest rate of the liability component 7.99 % 7.54 % |
Recent Accounting Pronounceme24
Recent Accounting Pronouncements - Additional Information (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 30, 2016 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Deferred debt issuance cost | $ 1,400 | $ 1,700 |
Deferred tax assets | 6,244 | |
Deferred income taxes | $ 21,276 | 28,147 |
Adjustments for New Accounting Principle, Early Adoption [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Deferred tax assets | (6,200) | |
Deferred income taxes | $ (6,200) |
Fair Value - Schedule of Assets
Fair Value - Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 30, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total available for sale debt securities, current | $ 29,116 | $ 35,146 |
Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market funds (cash and cash equivalents) | 235 | 117 |
Total available for sale debt securities, current | 29,116 | 35,146 |
Fair Value, Measurements, Recurring [Member] | US Corporate [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total available for debt sale securities | 10,888 | 9,580 |
Fair Value, Measurements, Recurring [Member] | Residential Mortgage-Backed [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total available for debt sale securities | 7,607 | 9,604 |
Fair Value, Measurements, Recurring [Member] | Government - US [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total available for debt sale securities | 10,621 | 15,962 |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market funds (cash and cash equivalents) | 235 | 117 |
Total available for sale debt securities, current | 29,116 | 35,146 |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | US Corporate [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total available for debt sale securities | 10,888 | 9,580 |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | Residential Mortgage-Backed [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total available for debt sale securities | 7,607 | 9,604 |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | Government - US [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total available for debt sale securities | $ 10,621 | $ 15,962 |
Fair Value - Additional Informa
Fair Value - Additional Information (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 30, 2016 | Dec. 12, 2012 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Certain other investments accounted for at cost | $ 7,700 | $ 7,700 | |
Issuance of convertible notes | $ 133,300 | ||
Carrying value of convertible senior notes | 173,229 | 169,857 | |
Estimated fair value of convertible debt | 194,000 | ||
Israeli Severance Arrangements [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Carrying value of assets related to deposits | 1,500 | $ 1,400 | |
1.50% Convertible Senior Notes Maturing on December 1, 2017 [Member] | Convertible Senior Notes [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Convertible senior notes issued | $ 189,750 | $ 189,800 |
Fair Value - Marketable Securit
Fair Value - Marketable Securities by Major Security Type (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 30, 2016 |
Marketable Securities [Line Items] | ||
Held to Maturity | $ 66 | $ 63 |
Available for Sale | 29,116 | 35,146 |
Total | 29,182 | 35,209 |
Corporate and Other Debt Securities [Member] | ||
Marketable Securities [Line Items] | ||
Held to Maturity | 66 | 63 |
Available for Sale | 29,116 | 35,146 |
Total | $ 29,182 | $ 35,209 |
Fair Value - Estimated Fair Val
Fair Value - Estimated Fair Value of Our Investments in Available for Sale Marketable Securities Classified (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 30, 2016 |
Fair Value Disclosures [Abstract] | ||
Due within 1 year | $ 13,848 | |
Due in 1 year through 5 years | 15,268 | |
Total | $ 29,116 | $ 35,146 |
Fair Value - Summary of Gross U
Fair Value - Summary of Gross Unrealized Losses and Fair Values of Available for Sale Investments (Detail) $ in Thousands | Sep. 30, 2016USD ($) |
Schedule of Available-for-sale Securities [Line Items] | |
Less than 12 Months, Unrealized Loss | $ 12 |
Less than 12 Months, Fair Value | 12,708 |
US Corporate [Member] | |
Schedule of Available-for-sale Securities [Line Items] | |
Less than 12 Months, Unrealized Loss | 7 |
Less than 12 Months, Fair Value | 8,752 |
Residential Mortgage-Backed [Member] | |
Schedule of Available-for-sale Securities [Line Items] | |
Less than 12 Months, Unrealized Loss | 5 |
Less than 12 Months, Fair Value | 3,458 |
Government - US [Member] | |
Schedule of Available-for-sale Securities [Line Items] | |
Less than 12 Months, Fair Value | $ 498 |
Other Investments - Additional
Other Investments - Additional Information (Detail) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 | Sep. 30, 2015 |
Schedule of Investments [Line Items] | |||
Impairment of variable interest entity investment | $ 17,000 | ||
Variable Interest Entity, Not Primary Beneficiary [Member] | |||
Schedule of Investments [Line Items] | |||
Impairment of variable interest entity investment | $ 0 | ||
Variable Interest Entity, Not Primary Beneficiary [Member] | Other Assets [Member] | |||
Schedule of Investments [Line Items] | |||
Variable interest entity investment, maximum loss exposure | $ 3,500,000 | ||
Preferred Stock [Member] | Variable Interest Entity, Not Primary Beneficiary [Member] | |||
Schedule of Investments [Line Items] | |||
Investments in a privately held company | $ 3,500,000 |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Computation of Basic and Diluted Net Loss Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Numerator - basic and diluted: | ||
Net loss | $ (10,508) | $ (4,253) |
Denominator: | ||
Shares used in computing basic and diluted net loss per share attributable to common stockholders | 37,940 | 38,004 |
Basic and diluted net loss per share attributable to common stockholders | $ (0.28) | $ (0.11) |
Net Loss per Share - Additional
Net Loss per Share - Additional Information (Detail) - $ / shares | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Earnings Per Share [Abstract] | ||
Anti-dilutive securities excluded from calculation of diluted earnings per share | 3,300,000 | 3,100,000 |
Number of shares purchased through issue of warrants | 6,300,000 | |
Common stock exercise price | $ 40.04 |
Operations by Segments and Ge33
Operations by Segments and Geographic Areas - Additional Information (Detail) | 3 Months Ended |
Sep. 30, 2016Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 4 |
Operations by Segments and Ge34
Operations by Segments and Geographic Areas - Schedule of Segment Reporting Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Segment revenue: | ||
Total segment revenue | $ 83,084 | $ 82,881 |
Segment measure of profit (loss): | ||
Total measure of segment profit | (5,892) | 29 |
Operating Segments [Member] | ||
Segment measure of profit (loss): | ||
Total measure of segment profit | 12,609 | 15,319 |
Payments and Transactional Documents [Member] | ||
Segment revenue: | ||
Total segment revenue | 24,846 | 27,416 |
Payments and Transactional Documents [Member] | Operating Segments [Member] | ||
Segment measure of profit (loss): | ||
Total measure of segment profit | 7,576 | 7,790 |
Hosted Solutions [Member] | ||
Segment revenue: | ||
Total segment revenue | 35,557 | 33,870 |
Hosted Solutions [Member] | Operating Segments [Member] | ||
Segment measure of profit (loss): | ||
Total measure of segment profit | 5,453 | 6,574 |
Digital Banking [Member] | ||
Segment revenue: | ||
Total segment revenue | 18,186 | 17,331 |
Digital Banking [Member] | Operating Segments [Member] | ||
Segment measure of profit (loss): | ||
Total measure of segment profit | 25 | 1,863 |
Other [Member] | ||
Segment revenue: | ||
Total segment revenue | 4,495 | 4,264 |
Segment measure of profit (loss): | ||
Total measure of segment profit | $ (445) | $ (908) |
Operations by Segments and Ge35
Operations by Segments and Geographic Areas - Reconciliation of Measure of Segment Profit to GAAP Loss Before Income Taxes (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||
Total measure of segment profit | $ (5,892) | $ 29 |
Less: | ||
Amortization of acquired intangible assets | (6,285) | (7,279) |
Stock-based compensation expense | (8,199) | (7,588) |
Other expense, net | (3,935) | (3,671) |
Loss before income taxes | (9,827) | (3,642) |
Operating Segments [Member] | ||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||
Total measure of segment profit | 12,609 | 15,319 |
Segment Reconciling Items [Member] | ||
Less: | ||
Amortization of acquired intangible assets | (6,285) | (7,279) |
Stock-based compensation expense | (8,199) | (7,588) |
Acquisition and integration related expenses | (1,249) | (110) |
Restructuring expenses | (20) | |
Minimum pension liability and related adjustments | (277) | (36) |
Global ERP system implementation costs | (2,491) | (257) |
Other expense, net | $ (3,935) | $ (3,671) |
Operations by Segments and Ge36
Operations by Segments and Geographic Areas - Schedule of Segment Depreciation Expense Included in Segment Measure of Profit (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Depreciation and other amortization expense: | ||
Depreciation and other amortization expense | $ 4,087 | $ 3,077 |
Payments and Transactional Documents [Member] | ||
Depreciation and other amortization expense: | ||
Depreciation and other amortization expense | 805 | 692 |
Hosted Solutions [Member] | ||
Depreciation and other amortization expense: | ||
Depreciation and other amortization expense | 1,840 | 1,424 |
Digital Banking [Member] | ||
Depreciation and other amortization expense: | ||
Depreciation and other amortization expense | 1,370 | 858 |
Other [Member] | ||
Depreciation and other amortization expense: | ||
Depreciation and other amortization expense | $ 72 | $ 103 |
Operations by Segments and Ge37
Operations by Segments and Geographic Areas - Schedule of Revenue Based on Point of Sale (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues from unaffiliated customers | $ 83,084 | $ 82,881 |
North America [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues from unaffiliated customers | 50,522 | 48,596 |
United Kingdom [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues from unaffiliated customers | 20,831 | 22,832 |
Continental Europe [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues from unaffiliated customers | 9,352 | 9,452 |
Asia-Pacific and Middle East [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues from unaffiliated customers | $ 2,379 | $ 2,001 |
Operations by Industry Segments
Operations by Industry Segments and Geographic Areas - Schedule of Long-Lived Assets, Excluding Deferred Tax Assets and Intangible Assets, Based on Geographic Designation (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 30, 2016 |
Long-lived assets | ||
Long-lived assets | $ 70,256 | $ 67,711 |
North America [Member] | ||
Long-lived assets | ||
Long-lived assets | 57,821 | 55,208 |
United Kingdom [Member] | ||
Long-lived assets | ||
Long-lived assets | 8,346 | 8,499 |
Continental Europe [Member] | ||
Long-lived assets | ||
Long-lived assets | 1,980 | 1,924 |
Asia-Pacific and Middle East [Member] | ||
Long-lived assets | ||
Long-lived assets | $ 2,109 | $ 2,080 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Income Tax Contingency [Line Items] | ||
Income tax (benefit) expense | $ 681 | $ 611 |
Unrecognized tax benefits decrease as a result of the expiration of certain statutes | 300 | |
Valuation allowance against certain deferred tax assets | 29,500 | |
United Kingdom [Member] | ||
Income Tax Contingency [Line Items] | ||
Discrete tax benefit | $ 100 |
Goodwill and Other Intangible40
Goodwill and Other Intangible Assets - Schedule of Intangible Assets Subject to Amortization and for Intangible Assets Not Subject to Amortization (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Jun. 30, 2016 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 354,804 | $ 354,445 |
Accumulated Amortization | (195,823) | (189,515) |
Net Carrying Value | 158,981 | 164,930 |
Goodwill | 201,489 | 202,028 |
Total intangible assets | 360,470 | 366,958 |
Customer Related [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 190,220 | 190,549 |
Accumulated Amortization | (113,157) | (110,356) |
Net Carrying Value | $ 77,063 | $ 80,193 |
Weighted Average Remaining Life | 9 years 4 months 24 days | 9 years 7 months 6 days |
Core Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 130,347 | $ 130,434 |
Accumulated Amortization | (67,003) | (64,591) |
Net Carrying Value | $ 63,344 | $ 65,843 |
Weighted Average Remaining Life | 9 years 3 months 18 days | 9 years 6 months |
Other Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 20,521 | $ 20,469 |
Accumulated Amortization | (13,928) | (13,320) |
Net Carrying Value | $ 6,593 | $ 7,149 |
Weighted Average Remaining Life | 6 years 1 month 6 days | 6 years 1 month 6 days |
Software Developed Other Than For Internal Use [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 13,716 | $ 12,993 |
Accumulated Amortization | (1,735) | (1,248) |
Net Carrying Value | $ 11,981 | $ 11,745 |
Weighted Average Remaining Life | 5 years 9 months 18 days | 6 years |
Goodwill and Other Intangible41
Goodwill and Other Intangible Assets - Schedule of Estimated Amortization Expense (Detail) $ in Thousands | Sep. 30, 2016USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
2,017 | $ 24,452 |
2,018 | 20,550 |
2,019 | 18,607 |
2,020 | 16,523 |
2,021 | 14,964 |
2022 and thereafter | 58,189 |
Software Developed Other Than For Internal Use [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
2,017 | 2,035 |
2,018 | 2,087 |
2,019 | 2,087 |
2,020 | 2,087 |
2,021 | 2,086 |
2022 and thereafter | $ 2,086 |
Goodwill and Other Intangible42
Goodwill and Other Intangible Assets - Schedule of Rollforward of Goodwill Balances, by Reportable Segment (Detail) $ in Thousands | 3 Months Ended |
Sep. 30, 2016USD ($) | |
Goodwill [Line Items] | |
Beginning Balance | $ 202,028 |
Impact of foreign currency translation | (539) |
Ending Balance | 201,489 |
Payments and Transactional Documents [Member] | |
Goodwill [Line Items] | |
Beginning Balance | 60,852 |
Impact of foreign currency translation | (387) |
Ending Balance | 60,465 |
Hosted Solutions [Member] | |
Goodwill [Line Items] | |
Beginning Balance | 89,573 |
Impact of foreign currency translation | (152) |
Ending Balance | 89,421 |
Digital Banking [Member] | |
Goodwill [Line Items] | |
Beginning Balance | 35,880 |
Ending Balance | 35,880 |
Other [Member] | |
Goodwill [Line Items] | |
Beginning Balance | 15,723 |
Ending Balance | $ 15,723 |
Goodwill and Other Intangible43
Goodwill and Other Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 30, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | $ 201,489 | $ 202,028 |
Intellinx [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Percentage of excess fair value over carrying value | 14.00% | |
Goodwill | $ 12,000 |
Convertible Senior Notes - Addi
Convertible Senior Notes - Additional Information (Detail) - USD ($) | Dec. 12, 2012 | Dec. 31, 2012 | Sep. 30, 2016 |
Debt Instrument [Line Items] | |||
Warrant expiration period | 150 days | ||
Warrants [Member] | |||
Debt Instrument [Line Items] | |||
Warrants exercisable beginning | Mar. 1, 2018 | ||
Warrants exercisable ending | Oct. 18, 2018 | ||
1.50% Convertible Senior Notes Maturing on December 1, 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Convertible notes conversion amount in multiples | $ 1,000 | ||
Percentage of common stock conversion price | 130.00% | ||
Initial conversion rate per $1,000 principal amount | 33.3042 | ||
Initial conversion price per share | $ 30.03 | ||
1.50% Convertible Senior Notes Maturing on December 1, 2017 [Member] | Convertible Senior Notes [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount of Convertible Senior Notes | $ 189,800,000 | $ 189,750,000 | |
Interest rate on Convertible Senior Notes | 1.50% | ||
Maturity date of Convertible Senior Notes | Dec. 1, 2017 | ||
Underwriters' exercise in full of over-allotment option | $ 24,800,000 | ||
Net proceeds from offering after adjusting for expenses, commissions and discounts | $ 167,300,000 | ||
Consecutive trading days | 30 days | ||
Common stock minimum trading days | 20 days | ||
Conditions for conversion of notes | During the five business day period after any five consecutive trading day period (the "measurement period") in which the trading price per $1,000 principal amount of the convertible notes for each trading day of the measurement period was less than 98% of the product of the last reported sales price of our common stock and the conversion rate on each trading day | ||
Last day conversion rate | 98.00% | ||
Percentage of repurchase price equal to principal amount of notes to be repurchased | 100.00% | ||
Redemption percentage of principal amount of notes outstanding by notice | 25.00% | ||
Redemption percentage of principal amount of notes outstanding at request by holders with accrued and unpaid interest | 100.00% | ||
Certain events of bankruptcy, insolvency or reorganization, redemption percentage of principal amount of notes outstanding with accrued and unpaid interest | 100.00% | ||
Notes Principal amount | $ 1,000 | ||
Interest rate per annum | 0.25% | ||
Estimated fair value of the contingent interest feature of the notes | $ 0 | ||
Convertible Senior Notes, term | 5 years | ||
Hedging of common stock | 6,300,000 | ||
Cost of the Note Hedges | $ 42,300,000 | ||
Proceeds from issuance of warrants, net of issue costs | $ 25,800,000 | ||
Purchase of common stock | 6,300,000 | ||
Common stock, strike price per share | $ 40.04 |
Convertible Senior Notes - Net
Convertible Senior Notes - Net Carrying Amount of Notes (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 12, 2012 |
Debt Instrument [Line Items] | ||
Net carrying value | $ 173,229 | |
1.50% Convertible Senior Notes Maturing on December 1, 2017 [Member] | Convertible Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount | 189,750 | $ 189,800 |
Unamortized debt issuance costs | (1,381) | |
Unamortized discount | $ (15,140) |
Convertible Senior Notes - Tota
Convertible Senior Notes - Total Interest Expense Related to Notes (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Debt Instrument [Line Items] | ||
Amortization of debt discount (non-cash) | $ 3,076 | $ 2,865 |
Amortization of debt issue costs (non-cash) | 296 | 296 |
Convertible Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Contractual interest expense (cash) | 712 | 712 |
Amortization of debt discount (non-cash) | 3,076 | 2,865 |
Amortization of debt issue costs (non-cash) | 296 | 296 |
Total interest expense | $ 4,084 | $ 3,873 |
Effective interest rate of the liability component | 7.99% | 7.54% |
Postretirement and Other Empl47
Postretirement and Other Employee Benefits - Components of Net Periodic Pension Costs for the Swiss Pension Plan (Detail) - Swiss Pension Plan [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Components of net periodic cost | ||
Service cost | $ 750 | $ 578 |
Interest cost | 32 | 123 |
Prior service credit | (23) | (23) |
Net actuarial loss | 165 | 18 |
Expected return on plan assets | (224) | (204) |
Net periodic cost | $ 700 | $ 492 |