Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Mar. 31, 2018 | May 14, 2018 | Sep. 30, 2017 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | NETSCOUT SYSTEMS INC | ||
Trading Symbol | NTCT | ||
Entity Central Index Key | 1,078,075 | ||
Current Fiscal Year End Date | --03-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Mar. 31, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 80,274,022 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 2,722,835,641 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 369,821 | $ 304,880 |
Marketable securities | 77,941 | 137,892 |
Accounts receivable and unbilled costs, net of allowance for doubtful accounts of $1,991 and $2,066 at March 31, 2018 and 2017, respectively | 213,438 | 294,374 |
Inventories and deferred costs | 34,774 | 40,002 |
Prepaid income taxes | 22,932 | 40,346 |
Prepaid expenses and other current assets (related party balances of $3,187 and $3,585 at March 31, 2018 and 2017, respectively) | 33,502 | 36,972 |
Total current assets | 752,408 | 854,466 |
Fixed assets, net | 52,511 | 61,393 |
Goodwill | 1,712,764 | 1,718,162 |
Intangible assets, net | 831,374 | 931,269 |
Deferred income taxes | 6,685 | 6,580 |
Long-term marketable securities | 0 | 21,933 |
Other assets | 12,866 | 7,710 |
Total assets | 3,368,608 | 3,601,513 |
Current liabilities: | ||
Accounts payable (related party balances of $369 and $444 at March 31, 2018 and 2017, respectively) | 30,133 | 37,407 |
Accrued compensation | 46,552 | 77,607 |
Accrued other | 33,164 | 29,522 |
Income taxes payable | 1,526 | 5,057 |
Deferred revenue and customer deposits | 301,925 | 310,594 |
Total current liabilities | 413,300 | 460,187 |
Other long-term liabilities | 8,308 | 3,976 |
Deferred tax liability | 151,563 | 277,599 |
Accrued long-term retirement benefits | 35,246 | 32,117 |
Long-term deferred revenue and customer deposits | 91,409 | 86,595 |
Long-term debt | 600,000 | 300,000 |
Contingent liabilities, net of current portion | 0 | 4,789 |
Total liabilities | 1,299,826 | 1,165,263 |
Commitments and contingencies (Note 17) | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value: 5,000,000 shares authorized; no shares issued or outstanding at March 31, 2018 and 2017 | 0 | 0 |
Common stock, $0.001 par value: 300,000,000 shares authorized; 117,744,913 and 115,917,431 shares issued and 80,270,023 and 92,041,288 shares outstanding at March 31, 2018 and 2017, respectively | 117 | 116 |
Additional paid-in capital | 2,665,120 | 2,693,846 |
Accumulated other comprehensive income (loss) | 2,895 | (3,472) |
Treasury stock at cost, 37,474,890 and 23,876,143 shares at March 31, 2018 and 2017, respectively | (995,843) | (570,921) |
Retained earnings | 396,493 | 316,681 |
Total stockholders’ equity | 2,068,782 | 2,436,250 |
Total liabilities and stockholders’ equity | $ 3,368,608 | $ 3,601,513 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 31, 2017 |
Related Party Transaction [Line Items] | ||
Accounts receivable, allowance for doubtful accounts | $ 1,991 | $ 2,066 |
Related party prepaid expenses and other current assets | 33,502 | 36,972 |
Related party accounts payable | $ 30,133 | $ 37,407 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, shares issued (in shares) | 117,744,913 | 115,917,431 |
Common stock, shares outstanding (in shares) | 80,270,023 | 92,041,288 |
Treasury stock (in shares) | 37,474,890 | 23,876,143 |
Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
Related party prepaid expenses and other current assets | $ 3,187 | $ 3,585 |
Related party accounts payable | $ 369 | $ 444 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Revenue: | |||
Product | $ 546,127 | $ 735,531 | $ 633,408 |
Service | 440,660 | 426,581 | 322,011 |
Total revenue | 986,787 | 1,162,112 | 955,419 |
Cost of revenue: | |||
Product (related party balances of $245, $7,229 and $25,055, respectively) | 164,526 | 238,002 | 238,037 |
Service (related party balances of $665, $745 and $5,736, respectively) | 107,379 | 108,137 | 90,412 |
Total cost of revenue | 271,905 | 346,139 | 328,449 |
Gross profit | 714,882 | 815,973 | 626,970 |
Operating expenses: | |||
Research and development (related party balances of $3, $1,624 and $16,701, respectively) | 215,076 | 232,701 | 208,630 |
Sales and marketing (related party balances of $2, $2,423 and $15,430, respectively) | 312,536 | 328,628 | 293,335 |
General and administrative (related party balances of $1,703, $4,099 and $16,055, respectively) | 109,479 | 118,438 | 117,714 |
Amortization of acquired intangible assets | 76,640 | 70,141 | 32,373 |
Restructuring charges | 5,209 | 4,001 | 468 |
Total operating expenses | 718,940 | 753,909 | 652,520 |
Income (loss) from operations | (4,058) | 62,064 | (25,550) |
Interest and other income (expense), net: | |||
Interest income | 1,808 | 1,021 | 691 |
Interest expense | (12,633) | (9,184) | (6,329) |
Other income (expense), net (related party balances of $56, $426 and ($379), respectively) | (3,776) | (1,716) | (1,251) |
Total interest and other expense, net | (14,601) | (9,879) | (6,889) |
Income (loss) before income tax expense (benefit) | (18,659) | 52,185 | (32,439) |
Income tax expense (benefit) | (98,471) | 18,894 | (4,070) |
Net income (loss) | $ 79,812 | $ 33,291 | $ (28,369) |
Basic net income (loss) per share (in dollars per share) | $ 0.91 | $ 0.36 | $ (0.35) |
Diluted net income (loss) per share (in dollars per share) | $ 0.90 | $ 0.36 | $ (0.35) |
Weighted average common shares outstanding used in computing: | |||
Net income (loss) per share-basic (in shares) | 87,425 | 92,226 | 81,927 |
Net income (loss) per share-diluted (in shares) | 88,261 | 92,920 | 81,927 |
Consolidated Statements of Ope5
Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Related party cost of product | $ 164,526 | $ 238,002 | $ 238,037 |
Related party cost of service | 107,379 | 108,137 | 90,412 |
Related party research and development | 215,076 | 232,701 | 208,630 |
Related party selling and marketing | 312,536 | 328,628 | 293,335 |
Related party general and administrative expense | 109,479 | 118,438 | 117,714 |
Related party other income (expense), net | (3,776) | (1,716) | (1,251) |
Affiliated Entity | |||
Related Party Transaction [Line Items] | |||
Related party cost of product | 245 | 7,229 | 25,055 |
Related party cost of service | 665 | 745 | 5,736 |
Related party research and development | 3 | 1,624 | 16,701 |
Related party selling and marketing | 2 | 2,423 | 15,430 |
Related party general and administrative expense | 1,703 | 4,099 | 16,055 |
Related party other income (expense), net | $ 56 | $ 426 | $ (379) |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ 79,812 | $ 33,291 | $ (28,369) |
Other comprehensive income (loss): | |||
Cumulative translation adjustments | 4,889 | (1,000) | 1,446 |
Recognition of actuarial net gain (loss) from pension and other post-retirement plans, net of taxes (benefit) of $435, ($368) and $215 | 1,353 | (858) | 632 |
Changes in market value of investments: | |||
Changes in unrealized (losses) gains, net of (benefit) taxes of $15, $0 and $0 | (6) | (59) | 3 |
Total net change in market value of investments | (6) | (59) | 3 |
Changes in market value of derivatives: | |||
Changes in market value of derivatives, net of tax (benefits) of $267, ($167), and ($329) | 812 | (277) | (523) |
Reclassification adjustment for net (losses) gains included in net income (loss), net of (benefit) taxes of ($219), $135, and $915 | (681) | 223 | 1,586 |
Total net change in market value of derivatives | 131 | (54) | 1,063 |
Other comprehensive income (loss) | 6,367 | (1,971) | 3,144 |
Total comprehensive income (loss) | $ 86,179 | $ 31,320 | $ (25,225) |
Consolidated Statements of Com7
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Recognition of actuarial net gain from pension and other post-retirement plans, tax expense (benefit) | $ 435 | $ (368) | $ 215 |
Changes in unrealized (losses) gains, taxes | (15) | 0 | 0 |
Changes in market value of derivatives, taxes (benefit) | 267 | (167) | (329) |
Reclassification adjustment for net gains included in net income, taxes | $ (219) | $ 135 | $ 915 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common stock Voting | Additional Paid In Capital | Accumulated Other Comprehensive Income (Loss) | Treasury stock | Retained Earnings |
Beginning Balance at Mar. 31, 2015 | $ 435,750 | $ 51 | $ 298,101 | $ (4,645) | $ (169,516) | $ 311,759 |
Beginning Balance (in shares) at Mar. 31, 2015 | 50,812,548 | 10,004,743 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (28,369) | (28,369) | ||||
Unrealized net investment gains (losses) | 3 | 3 | ||||
Unrealized net gains (losses) on derivative financial instruments | 1,063 | 1,063 | ||||
Cumulative translation adjustments | 1,446 | 1,446 | ||||
Recognition from actuarial net gain from pension and other post-retirement plan | 632 | 632 | ||||
Issuance of common stock pursuant to vesting of restricted stock units | 1 | $ 1 | ||||
Issuance of common stock pursuant to vesting of restricted stock units (in shares) | 736,170 | |||||
Stock-based compensation expense for restricted stock units granted to employees | 26,609 | 26,609 | ||||
Issuance of common stock under employee stock purchase plan | 10,560 | 10,560 | ||||
Issuance of common stock under employee stock purchase plan (in shares) | 447,252 | |||||
Repurchase of treasury stock | (311,850) | $ (311,850) | ||||
Repurchase of treasury stock (in shares) | 10,402,402 | |||||
Issuance of shares related to the Comms Transaction | 2,305,611 | $ 62 | 2,305,549 | |||
Issuance of shares related to the Comms Transaction (in shares) | 62,499,644 | |||||
Tax effect from share-based compensation awards | 1,926 | 1,926 | ||||
Ending Balance at Mar. 31, 2016 | 2,443,382 | $ 114 | 2,642,745 | (1,501) | $ (481,366) | 283,390 |
Ending Balance (in shares) at Mar. 31, 2016 | 114,495,614 | 20,407,145 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 33,291 | 33,291 | ||||
Unrealized net investment gains (losses) | (59) | (59) | ||||
Unrealized net gains (losses) on derivative financial instruments | (54) | (54) | ||||
Cumulative translation adjustments | (1,000) | (1,000) | ||||
Recognition from actuarial net gain from pension and other post-retirement plan | (858) | (858) | ||||
Issuance of common stock pursuant to vesting of restricted stock units | 2 | $ 2 | ||||
Issuance of common stock pursuant to vesting of restricted stock units (in shares) | 950,159 | |||||
Stock-based compensation expense for restricted stock units granted to employees | 36,449 | 36,449 | ||||
Issuance of common stock under employee stock purchase plan | 15,697 | 15,697 | ||||
Issuance of common stock under employee stock purchase plan (in shares) | 471,658 | |||||
Repurchase of treasury stock | (89,555) | $ (89,555) | ||||
Repurchase of treasury stock (in shares) | 3,468,998 | |||||
Tax effect from share-based compensation awards | (1,045) | (1,045) | ||||
Ending Balance at Mar. 31, 2017 | 2,436,250 | $ 116 | 2,693,846 | (3,472) | $ (570,921) | 316,681 |
Ending Balance (in shares) at Mar. 31, 2017 | 115,917,431 | 23,876,143 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 79,812 | 79,812 | ||||
Unrealized net investment gains (losses) | (6) | (6) | ||||
Unrealized net gains (losses) on derivative financial instruments | 131 | 131 | ||||
Cumulative translation adjustments | 4,889 | 4,889 | ||||
Recognition from actuarial net gain from pension and other post-retirement plan | 1,353 | 1,353 | ||||
Issuance of common stock pursuant to vesting of restricted stock units | 1 | $ 1 | ||||
Issuance of common stock pursuant to vesting of restricted stock units (in shares) | 1,216,535 | |||||
Stock-based compensation expense for restricted stock units granted to employees | 43,425 | 43,425 | ||||
Issuance of common stock under employee stock purchase plan | 17,849 | 17,849 | ||||
Issuance of common stock under employee stock purchase plan (in shares) | 610,947 | |||||
Repurchase of treasury stock | (514,922) | (90,000) | $ (424,922) | |||
Repurchase of treasury stock (in shares) | 13,598,747 | |||||
Ending Balance at Mar. 31, 2018 | $ 2,068,782 | $ 117 | $ 2,665,120 | $ 2,895 | $ (995,843) | $ 396,493 |
Ending Balance (in shares) at Mar. 31, 2018 | 117,744,913 | 37,474,890 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) | |
Cash flows from operating activities: | |||
Net income (loss) | $ 79,812 | $ 33,291 | $ (28,369) |
Adjustments to reconcile net income (loss) to cash provided by operating activities, net of the effects of acquisitions: | |||
Depreciation and amortization | 153,503 | 160,863 | 140,071 |
Loss on disposal of fixed assets | 481 | 271 | 134 |
Deal related compensation expense and accretion charges | 153 | 153 | 6,728 |
Share-based compensation expense associated with equity awards | 47,317 | 39,189 | 28,351 |
Deferred income taxes | (127,784) | (11,008) | (42,121) |
Other (gains) losses | 18 | (111) | (279) |
Changes in assets and liabilities | |||
Accounts receivable and unbilled costs | 84,952 | (48,080) | (23,259) |
Due from related party | 443 | 25,055 | (18,483) |
Inventories | 1,006 | 12,456 | 5,523 |
Prepaid expenses and other assets | 20,147 | (24,751) | (29,481) |
Accounts payable | (8,929) | 405 | 2,334 |
Accrued compensation and other expenses | (17,718) | 6,785 | 33,250 |
Due to related party | (75) | (2,792) | (6,743) |
Income taxes payable | (2,734) | 1,963 | 3,910 |
Deferred revenue | (8,138) | 33,075 | 25,645 |
Net cash provided by operating activities | 222,454 | 226,764 | 97,211 |
Cash flows from investing activities: | |||
Purchase of marketable securities | (114,178) | (199,841) | (100,278) |
Proceeds from maturity of marketable securities | 196,041 | 181,321 | 118,881 |
Purchase of fixed assets | (15,913) | (29,696) | (24,783) |
Purchase of intangible assets | (544) | (1,031) | (3,962) |
Acquisition of businesses, net of cash acquired | (8,334) | (4,606) | 27,700 |
(Increase) decrease in deposits | (330) | 129 | (150) |
Contingent purchase consideration | 523 | 660 | 0 |
Collection of contingently returnable consideration | 0 | 12,864 | 9,306 |
Capitalized software development costs | (137) | (1,421) | (1,625) |
Net cash provided by (used in) investing activities | 57,128 | (41,621) | 25,089 |
Cash flows from financing activities: | |||
Issuance of common stock under stock plans | 1 | 2 | 1 |
Payment of contingent consideration | (660) | 0 | 0 |
Treasury stock repurchases, including accelerated share repurchases | (501,324) | (79,996) | (302,784) |
Tax withholding on restricted stock units | (13,598) | (9,559) | (9,066) |
Proceeds from issuance of long-term debt, net of issuance costs | 294,619 | 0 | 294,623 |
Net cash used in financing activities | (220,962) | (89,553) | (17,226) |
Effect of exchange rate changes on cash and cash equivalents | 6,385 | (761) | 744 |
Net increase in cash and cash equivalents | 65,005 | 94,829 | 105,818 |
Cash and cash equivalents, beginning of year | 305,726 | 210,897 | 105,079 |
Cash and cash equivalents, end of year | 370,731 | 305,726 | 210,897 |
Supplemental disclosures of cash flow information: | |||
Cash paid for interest | 9,604 | 6,442 | 3,807 |
Cash paid for income taxes | 18,216 | 49,290 | 50,658 |
Non-cash transactions: | |||
Transfers of inventory to fixed assets | 5,556 | 4,928 | 1,229 |
Additions to property, plant and equipment included in accounts payable | 1,379 | 1,241 | (1,065) |
Debt issuance costs settled through the issuance of additional debt | 0 | 0 | 5,377 |
Issuance of common stock under employee stock purchase plans | 17,849 | 15,697 | 10,560 |
Contingent consideration related to acquisition, included in accrued other | 523 | 660 | 0 |
Tenant improvement allowance | 2,104 | 0 | 0 |
Purchase consideration | |||
Non-cash transactions: | |||
Noncash business transaction | 0 | 0 | 2,276,256 |
Contingently returnable consideration | |||
Non-cash transactions: | |||
Noncash business transaction | $ 0 | $ 0 | $ 29,355 |
NATURE OF BUSINESS
NATURE OF BUSINESS | 12 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
NATURE OF BUSINESS | NATURE OF BUSINESS NetScout Systems, Inc., or NetScout or the Company, has been a technology innovator for three-plus decades since its founding in 1984. The Company's solutions, based on patented Adaptive Service Intelligence (ASI) technology, help customers identify network and application performance issues, defend their networks from denial of service (DDoS) attacks, and rapidly find and isolate advanced network threats. As a result, customers can quickly resolve issues that cause business disruptions, downtime, poor service quality or compromised security, thereby driving compelling returns on their investments in their network and broader information technology (IT) initiatives. The Company reports revenue and income in one reportable segment. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The consolidated financial statements include the accounts of NetScout and its wholly owned subsidiaries. Inter-company transactions and balances have been eliminated in consolidation. Fiscal Year End During fiscal years 2018 and 2017, the fiscal year end of NetScout and its wholly owned subsidiaries ended on March 31st. During the fiscal year 2016, the fiscal year end of NetScout and its wholly owned subsidiaries ended on March 31st, except for Fluke Networks Enterprise business, which ended on April 1, 2016. During fiscal years 2018 and 2017, NetScout’s quarters ended on the last calendar day of the months of June, September and December. The fiscal year 2016 quarter end dates of the entities acquired as part of the acquisition of Danaher Corporation's (Danaher) Communications Business in July 2015 (Comms Transaction) were October 2nd and December 31st. The Company does not adjust for the difference in fiscal periods between the acquired entities and itself, as such difference would be fewer than 93 days, pursuant to Regulation S-X Rule 3A-02. References herein to Fiscal 2018, 2017 and 2016 refer to the fiscal years ended March 31, 2018, 2017, and 2016, respectively. Segment Reporting Our operating segments are determined based on the units that constitute a business for which financial information is available and for which operating results are regularly reviewed by the Chief Operating Decision Maker (CODM). The Company reports revenue and income in one reportable segment. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates in these financial statements include those involving revenue recognition, valuation of goodwill and acquired assets and liabilities, valuation of the pension obligation and share-based compensation. These items are continuously monitored and analyzed by management for changes in facts and circumstances and material changes in these estimates could occur in the future. Cash and Cash Equivalents and Marketable Securities Under current authoritative guidance, NetScout has classified its investments as "available-for-sale" which are carried at fair value based on quoted market prices and associated unrealized gains or losses are recorded as a separate component of stockholders’ equity until realized. NetScout considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents and those investments with original maturities greater than three months to be marketable securities. At March 31, 2018 and periodically throughout the year, NetScout has maintained cash balances in various operating accounts in excess of federally insured limits. NetScout limits the amount of credit exposure by investing only with credit worthy institutions which the Company believes are those institutions with an investment grade rating for deposits. Revenue Recognition The Company exercises judgment and uses estimates in connection with determining the amounts of product and services revenues to be recognized in each accounting period. The Company derives revenues primarily from the sale of network management tools and security solutions for service provider and enterprise customers, which include hardware, software and service offerings. The majority of the Company’s product sales consist of hardware products with embedded software that are essential to providing customers the intended functionality of the solutions. The Company also sells stand-alone software solutions to provide customers with enhanced functionality. In addition, the Company sells hardware bundled with a software license. Product revenue is recognized upon shipment, provided that evidence of an arrangement exists, title and risk of loss have passed to the customer, and in the case of software products, when the customer has the rights and ability to access the software, fees are fixed or determinable and collection of the related receivable is reasonably assured. If any significant obligations to the customer remain post-delivery, typically involving obligations relating to installation and acceptance by the customer, revenue recognition is deferred until such obligations have been fulfilled. Because many of the Company’s solutions are comprised of both hardware and more than incidental software components, the Company recognizes revenue in accordance with authoritative guidance on both hardware and software revenue recognition. The Company's service offerings include installation, integration, extended warranty and maintenance services, post-contract customer support (PCS), and other professional services including consulting and training. The Company generally provides software and/or hardware support as part of product sales. Revenue related to the initial bundled software and hardware support is recognized ratably over the support period. In addition, customers can elect to purchase extended support agreements for periods after the initial software/hardware warranty expiration. Support services generally include rights to unspecified upgrades (when and if available), telephone and internet-based support, updates, bug fixes and hardware repair and replacement. Consulting services are recognized upon delivery or completion of performance. Reimbursements of out-of-pocket expenditures incurred in connection with providing consulting services are included in services revenue, with the offsetting expense recorded in cost of service revenue. Training services include on-site and classroom training. Training revenues are recognized upon delivery of the training. Generally, the Company's contracts are accounted for individually. However, when contracts are closely interrelated and dependent on each other, it may be necessary to account for two or more contracts as one to reflect the substance of the group of contracts. Multi-element arrangements are concurrent customer purchases of a combination of the Company's product and service offerings that may be delivered at various points in time. For multi-element arrangements comprised only of hardware products and related services, the Company allocates the total arrangement consideration to the multiple elements based on each element’s fair value compared to the total relative selling price of all the elements. Each element’s selling price is based on management’s best estimate of selling price (BESP) paid by customers based on the element’s historical pricing when vendor-specific objective evidence (VSOE) or third-party evidence (TPE) does not exist. The Company has established BESP for product elements as the average or median selling price the element was recently sold for, whether sold alone or sold as part of a multiple element transaction. The Company also considers its overall pricing objectives and practices across different sales channels and geographies, and market conditions. The Company reviews sales of the product elements on a quarterly basis and updates when appropriate, its BESP for such elements to ensure that it reflects recent pricing experience. The Company has established VSOE for a majority of its service elements based on historical stand-alone sales or by the renewal rate offered to the customer. However, certain business units acquired as part of the Comms Transaction are unable to establish VSOE for undelivered elements. This occurs because the pricing for standalone sales does not occur in tight bands around a midpoint, and they are not contractually fixed. In these scenarios the Company has typically established BESP by creating wider bands around a midpoint for standalone transactions or in some cases using cost plus a margin for the underlying services and products. If VSOE of fair value does not exist for a deliverable, the Company has determined that BESP is the highest level of fair value that exists for those deliverables. For multi-element arrangements comprised only of software products and related services, the Company allocates a portion of the total arrangement consideration to the undelivered elements, primarily support agreements and professional services, using vendor-specific objective evidence of fair value for the undelivered elements. The remaining portion of the total arrangement consideration is allocated to the delivered software, referred to as the residual method. VSOE of fair value of the undelivered elements is based on the price customers pay when the element is sold separately. The Company reviews the separate sales of the undelivered elements on a regular basis and updates when appropriate, its VSOE of fair value for such elements to ensure that it reflects recent pricing experience. If the Company cannot objectively determine the VSOE of the fair value of any undelivered software element, revenue is deferred until all elements are delivered and services have been performed, or until fair value can objectively be determined for any remaining undelivered elements. However, if the only undelivered element is maintenance and support, the entire arrangement fee is recognized over the service period. For multi-element arrangements comprised of a combination of hardware and software elements, the total arrangement consideration is bifurcated between the hardware and hardware related deliverables and the software and software related deliverables based on the relative selling prices of all deliverables as a group. Then, arrangement consideration for the hardware and hardware-related services is recognized upon delivery or as the related services are provided outlined above and revenue for the software and software-related services is allocated following the residual method and recognized based upon delivery or as the related services are provided. The Company's products are distributed through its direct sales force and indirect distribution channels through alliances with resellers and distributors. Revenue arrangements with resellers and distributors are recognized on a sell-in basis; that is, when the Company delivers the product to the reseller or distributor. The Company records consideration given to a reseller or distributor as a reduction of revenue to the extent the Company has recorded revenue from the reseller or distributor. With limited exceptions, the Company's return policy does not allow product returns for a refund. Returns have been insignificant to date. In addition, the Company has a history of successfully collecting receivables from our resellers and distributors. Commission Expense The Company recognizes commission expense related to the renewal of maintenance contracts at the time an order is booked. As a result, commission expense can be recognized in full even though the related revenue may not be fully recognized. Base commission expense on product revenue and corresponding new maintenance contracts is recognized in the same period as related product revenue, typically upon shipment. Uncollected Deferred Revenue Because of NetScout's revenue recognition policies, there are circumstances for which the Company does not recognize revenue relating to sales transactions that have been billed, but the related account receivable has not been collected. While the receivable represents an enforceable obligation, for balance sheet presentation purposes, the Company has not recognized the deferred revenue or the related account receivable and no amounts appear in the consolidated balance sheets for such transactions. The aggregate amount of unrecognized accounts receivable and deferred revenue was $20.0 million and $17.9 million at March 31, 2018 and 2017 , respectively. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of investments, trade accounts receivable and accounts payable. NetScout's cash, cash equivalents, and marketable securities are placed with financial institutions with high credit standings. At March 31, 2018 and 2017 respectively, the Company had no direct customers or indirect channel partners which accounted for more than 10% of the accounts receivable balance. During the fiscal year ended March 31, 2018 no direct customers or indirect channel partners accounted for more than 10% of total revenue. During the fiscal years ended March 31, 2017 and 2016 , one direct customer, Verizon, accounted for more than 10% of total revenue, while no indirect channel partner accounted for more than 10% of total revenue. As disclosed parenthetically within the Company's consolidated balance sheet, the Company had a receivable from related parties in the amount of $3.2 million that represents a concentration of credit risk at March 31, 2018 . Historically, the Company has not experienced any significant failure of its customers to meet their payment obligations nor does the Company anticipate material non-performance by its customers in the future; accordingly, the Company does not require collateral from its customers. However, if the Company’s assumptions are incorrect, there could be an adverse impact on its allowance for doubtful accounts. Trade Receivable Valuations Accounts receivable are stated at their net realizable value. The allowance against gross trade receivables reflects the best estimate of probable losses inherent in the receivables portfolio determined on the basis of historical experience, specific allowances for known troubled accounts and other currently available information. Inventories Inventories are stated at the lower of actual cost or net realizable value. Cost is determined by using the first-in, first-out (FIFO) method. Fixed Assets Fixed assets are stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term or anticipated useful life of the improvement. Gains and losses upon asset disposal are recognized in the year of disposition. Expenditures for replacements and building improvements are capitalized, while expenditures for maintenance and repairs are charged against earnings as incurred. Valuation of Goodwill, Intangible Assets and Other Acquisition Accounting Items The Company amortizes acquired definite-lived intangible assets over their estimated useful lives. Goodwill and other indefinite-lived intangible assets are not amortized but subject to annual impairment tests; more frequently if events or circumstances occur that would indicate a potential decline in their fair value. The Company performs the assessment annually during the fourth quarter and on an interim basis if potential impairment indicators arise. The Company has identified two reporting units: (1) Service Assurance and (2) Security. To test impairment, the Company first assesses qualitative factors to determine whether the existence of events and circumstances indicate that it is more likely than not that the intangible asset is impaired. If based on the Company's qualitative assessment it is more likely than not that the fair value of the intangible asset is less than its carrying amount, quantitative impairment testing is required. However, if the Company concludes otherwise, quantitative impairment testing is not required. During fiscal year 2018, the Company performed a quantitative analysis for goodwill and its non-amortizing intangible asset. The Company determined the fair value of the reporting unit's goodwill using established income and market valuation approaches and the fair value of its trade names using a forward-looking relief from royalty model. All goodwill and indefinite-lived intangible assets were estimated to be recoverable as of January 31, 2018. The Company completed three acquisitions during the three-year period ended March 31, 2018 . The acquisition method of accounting requires an estimate of the fair value of the assets and liabilities acquired as part of these transactions. In order to estimate the fair value of acquired intangible assets, the Company uses a relief from royalty model which requires management to estimate: future revenues expected to be generated by the acquired intangible assets, a royalty rate which a market participant would pay related to the projected revenue stream, a present value factor which approximates a risk adjusted rate of return for a market participant purchasing the assets, and a technology migration curve representing a period of time over which the technology assets or some portion thereof are still being used. The Company is also required to develop the fair value for customer relationships acquired as part of these transactions which requires that we create estimates for the following items: a projection of future revenues associated with the acquired company’s existing customers, a turnover rate for those customers, a margin related to those sales, and a risk adjusted rate of return for a market participant purchasing those relationships. The Company has a contingent liability for $523 thousand related to the acquisition of Efflux in July 2017 for which an escrow account was established to cover damages NetScout suffers related to any liabilities that NetScout did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the merger agreement. Generally, indemnification claims that Efflux would be liable for are limited to the total amount of the escrow account and shall be the sole source for the satisfaction of any damages to the Company for such claims, but such limitation does not apply with respect to seller's breach of certain fundamental representations or related to other specified indemnity items, for which certain of Efflux's shareholders may be liable for additional amounts in excess of the escrow amount. Except to the extent that valid indemnification claims are made prior to such time, the $523 thousand will be paid to the seller on July 12, 2018. The Company's contingent purchase consideration at March 31, 2017 included $660 thousand related to the acquisition of Avvasi Incorporated (Avvasi) in August 2016 for which an escrow account was established to cover damages NetScout suffers related to any liabilities that NetScout did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the asset purchase agreement. The $660 thousand was paid to the seller on August 21, 2017. The Comms Transaction during fiscal year ended March 31, 2016 contained both contingently returnable consideration and contingent purchase consideration. The contingently returnable consideration represented a contingent right of return from Danaher to reimburse NetScout for certain cash awards paid by NetScout to employees of the Communications Business transferred to Newco for post-combination services on various dates through August 4, 2016. During the fiscal year ended March 31, 2017, certain post-combination cash retention payments had been disbursed. Danaher reimbursed the Company for those costs and NetScout reimbursed Danaher for the tax benefit. The acquisition of Simena LLC on November 18, 2011 also contained contingent consideration based on the ultimate settlement of assets and liabilities acquired as part of the transaction, and the former owners' future period of employment with the Company. Contingent consideration accounting requires the Company to estimate the probability of various settlement scenarios, the former owners' expected period of employment with NetScout, and a risk adjusted interest rate to present value the payment streams. Capitalized Software Development Costs Costs incurred in the research and development of the Company’s products are expensed as incurred, except for certain software development costs. Costs associated with the development of computer software are expensed prior to the establishment of technological feasibility and capitalized thereafter until the related software products are available for first customer shipment. Such costs are amortized using the straight-line method over the estimated economic life of the product, which generally does not exceed three years . Capitalized software development costs are periodically assessed for recoverability in the event of changes to the anticipated future revenue for the software products or changes in product technologies. Unamortized capitalized software development costs that are determined to be in excess of the net realizable value of the software products would be expensed in the period in which such a determination is made. Typically for accounting purposes, these R&D investments have not been capitalized because of the development methodology employed. The developments are added individually to the core code over a shorter period of time but marketed as a release once all portions are complete. Amortization included as cost of product revenue was $1.0 million , $594 thousand and $ 0 for the fiscal years ended March 31, 2018 , 2017 , and 2016 , respectively. The Company capitalized $0.1 million and $1.4 million in software development costs in the fiscal years ended March 31, 2018 and 2017 . Derivative Financial Instruments Under authoritative guidance for derivative instruments and hedging activities, all hedging activities must be documented at the inception of the hedge and must meet the definition of highly effective in offsetting changes to future cash flows in order for the derivative to qualify for hedge accounting. Under the guidance, if an instrument qualifies for hedge accounting, the changes in the fair value each period for open contracts, measured at the end of the period, are recorded to other comprehensive income. Otherwise, changes in the fair value are recorded in earnings each period. Management must perform initial and ongoing tests in order to qualify for hedge accounting. In accordance with the guidance, the Company accounts for its instruments under hedge accounting. The effectiveness and a measurement of ineffectiveness of qualifying hedge contracts are assessed by the Company quarterly. The Company records the fair value of its derivatives in prepaid expenses and other current assets and accrued other in the Company's consolidated balance sheet. The effective portion of gains or losses resulting from changes in the fair value of qualifying hedges are recorded in other comprehensive income (loss) until the forecasted transaction occurs, with any ineffective portion classified directly to the Company’s consolidated statement of operations based on the expense categories of the items being hedged. When forecasted transactions occur, unrealized gains or losses associated with the effective portion of the hedge are reclassified to the respective expense categories in the Company’s consolidated statement of operations. Gains or losses related to hedging activity are included as operating activities in the Company’s consolidated statement of cash flows. If the underlying forecasted transactions do not occur, or it becomes probable that they will not occur, the gain or loss on the related cash flow hedge is recognized immediately in earnings. Contingencies NetScout accounts for claims and contingencies in accordance with authoritative guidance that requires an estimated loss to be recorded from a claim or loss contingency when information available prior to issuance of our consolidated financial statements indicates that it is probable that a liability has been incurred at the date of the consolidated financial statements and the amount of the loss can be reasonably estimated. If NetScout determines that it is reasonably possible but not probable that an asset has been impaired or a liability has been incurred or if the amount of a probable loss cannot be reasonably estimated, then in accordance with the authoritative guidance, we disclose the amount or range of estimated loss if the amount or range of estimated loss is material. Accounting for claims and contingencies requires NetScout to use its judgment. NetScout consults with legal counsel on those issues related to litigation and seeks input from other experts and advisors with respect to matters in the ordinary course of business. Contingent liabilities include contingent consideration in connection with the Company’s acquisitions. Contingent consideration represents earnout payments in connection with the Company’s acquisitions and is recognized at fair value on the acquisition date and remeasured each reporting period with subsequent adjustments recognized in the consolidated statements of income. The Company discounts the contingent purchase consideration to present value using a risk adjusted interest rate at each reporting period. Contingent consideration is valued using significant inputs that are not observable in the market which are defined as Level 3 inputs pursuant to fair value measurement accounting. The Company believes its estimates and assumptions are reasonable, however, there is significant judgment involved. Changes in the fair value of contingent liabilities may result from changes in discount periods. The Company reflects changes in fair value due to probability changes in earnings in the consolidated statements of income. Earnout payments are reflected in cash flows from financing activities and the changes in fair value are reflected in cash flows from operating activities in the consolidated statements of cash flows. Share-Based Compensation NetScout recognizes compensation expense for all share-based payments granted. Under the fair value recognition provisions, share-based compensation is calculated net of an estimated forfeiture rate and compensation cost is only recognized for those shares expected to vest on a straight-line basis over the expected requisite service period of the award. Foreign Currency NetScout accounts for its reporting of foreign operations in accordance with guidance which establishes guidelines for the determination of the functional currency of foreign subsidiaries. In accordance with the guidance, NetScout has determined its functional currency for those foreign subsidiaries that are an extension of NetScout's U.S. operations to be the U.S. Dollar. Assets and liabilities of subsidiaries operating outside the United States with a functional currency other than U.S. dollars are translated into United States dollars using the period-end exchange rate, and income and expense items are translated using the average exchange rate during the period. Cumulative translation adjustments are reflected as a separate component of stockholders’ equity. NetScout will experience currency exchange risk with respect to foreign currency denominated expenses. In order to partially offset the risks associated with the effects of certain foreign currency exposures, NetScout has established a program that utilizes foreign currency forward contracts. Under this program, increases or decreases in foreign currency exposures are partially offset by gains or losses on forward contracts, to mitigate the impact of foreign currency transaction gains or losses. The Company does not use forward contracts to engage in currency speculation. All outstanding foreign currency forward contracts are recorded at fair value at the end of each fiscal period. The Company had foreign currency losses of $4.1 million , $2.5 million and $1.5 million for the fiscal years ended March 31, 2018 , 2017 and 2016 , respectively. These amounts are included in other income (expense), net. Advertising Expense NetScout recognizes advertising expense as incurred. Advertising expense was $6.5 million , $8.1 million and $6.4 million for the fiscal years ended March 31, 2018 , 2017 and 2016 , respectively. Comprehensive Income (Loss) Comprehensive income (loss) is comprised of net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) typically consists of unrealized gains and losses on marketable securities, unrealized gain (loss) on hedge contracts, actuarial gains and losses, and foreign currency translation adjustments. Income Taxes NetScout accounts for its income taxes under the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax basis, as well as the effect of any net operating loss and tax credit carryforwards. Income tax expense is comprised of the current tax liability or benefit and the change in deferred tax assets and liabilities. We evaluate the recoverability of deferred tax assets by considering all positive and negative evidence relating to future profitability. We weigh objective and verifiable evidence more heavily in this analysis. In situations where we conclude that we do not have sufficient objective and verifiable evidence to support the realizability of the deferred tax asset, we create a valuation allowance against it. Recent Accounting Standards In March 2018, the Financial Account Standards Board (FASB) issued Accounting Standards Update (ASU) 2018-05 associated with the accounting and disclosures around the enactment of the Act and the Securities and Exchange Commission’s Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which the Company has adopted. In February 2018, the FASB issued ASU 2018-02, Reclassification of Certain Tax Effects From Accumulated Other Comprehensive Income. ASU 2018-02 amends ASC 220, Income Statement - Reporting Comprehensive Income, to allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Act. In addition, under the ASU 2018-02, the Company may be required to provide certain disclosures regarding stranded tax effects. ASU 2018-02 is effective for years beginning after December 15, 2018, and interim periods within those fiscal years. ASU 2018-02 is effective for the Company beginning April 1, 2019. Early adoption is permitted. The Company does not believe the adoption of ASU 2018-02 will have a material impact on its consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities (ASU 2017-12). ASU 2017-12 intends to better align an entity's risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The amendments expand and refine hedge accounting for both non-financial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. This standard is effective for financial statements issued for fiscal years beginning after December 15, 2018, with early adoption permitted. ASU 2017-12 is effective for the Company beginning April 1, 2019. The Company is currently assessing the potential impact of the adoption of ASU 2017-12 on its consolidated financial statements. In March 2017, the FASB issued ASU 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-Retirement Benefit Cost (ASU 2017-07) which requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. This standard is effective for financial statements issued for fiscal years beginning after December 15, 2017 and should be applied retrospectively to all periods presented. ASU 2017-07 is effective for the Company beginning April 1, 2018. The Company does not believe the adoption of ASU 2017-07 will have a material impact on its consolidated financial statements. In January 2017, the FASB i |
CASH, CASH EQUIVALENTS AND MARK
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES | 12 Months Ended |
Mar. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES | CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES Cash and cash equivalents consisted of money market instruments and cash maintained with various financial institutions at March 31, 2018 and 2017 . Cash, Cash Equivalents and Restricted Cash The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows (in thousands): March 31, 2018 March 31, 2017 March 31, 2016 March 31, 2015 Cash and cash equivalents $ 369,821 $ 304,880 $ 210,711 $ 104,893 Restricted cash 910 846 186 186 Total cash, cash equivalents and restricted cash $ 370,731 $ 305,726 $ 210,897 $ 105,079 The Company's restricted cash includes cash balances which are legally or contractually restricted. The Company's restricted cash is included within prepaid and other current assets and consists of amounts related to holdbacks associated with prior acquisitions. Marketable Securities The following is a summary of marketable securities held by NetScout at March 31, 2018 classified as short-term and long-term (in thousands): Amortized Cost Unrealized Losses Fair Value Type of security: U.S. government and municipal obligations $ 42,246 $ (60 ) $ 42,186 Commercial paper 33,003 — 33,003 Corporate bonds 2,754 (2 ) 2,752 Total short-term marketable securities 78,003 (62 ) 77,941 Total long-term marketable securities — — — Total marketable securities $ 78,003 $ (62 ) $ 77,941 The following is a summary of marketable securities held by NetScout at March 31, 2017 , classified as short-term and long-term (in thousands): Amortized Cost Unrealized Losses Fair Value Type of security: U.S. government and municipal obligations $ 98,989 $ (21 ) $ 98,968 Commercial paper 29,469 — 29,469 Corporate bonds 7,959 (3 ) 7,956 Certificates of deposit 1,499 — 1,499 Total short-term marketable securities 137,916 (24 ) 137,892 U.S. government and municipal obligations 21,952 (19 ) 21,933 Total long-term marketable securities 21,952 (19 ) 21,933 Total marketable securities $ 159,868 $ (43 ) $ 159,825 Contractual maturities of the Company’s marketable securities held at March 31, 2018 and March 31, 2017 were as follows (in thousands): March 31, March 31, Available-for-sale securities: Due in 1 year or less $ 77,941 $ 137,892 Due after 1 year through 5 years — 21,933 $ 77,941 $ 159,825 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value. Level 1 refers to fair values determined based on quoted prices in active markets for identical assets. Level 2 refers to fair values estimated using significant other observable inputs, and Level 3 includes fair values estimated using significant non-observable inputs. The following tables present the Company’s financial assets and liabilities measured on a recurring basis using the fair value hierarchy at March 31, 2018 and 2017 (in thousands): Fair Value Measurements at March 31, 2018 Level 1 Level 2 Level 3 Total ASSETS: Cash and cash equivalents $ 369,821 $ — $ — $ 369,821 U.S. government and municipal obligations 14,513 27,673 — 42,186 Commercial paper — 33,003 — 33,003 Corporate bonds 2,752 — — 2,752 Derivative financial instruments — 122 — 122 $ 387,086 $ 60,798 $ — $ 447,884 LIABILITIES: Contingent purchase consideration $ — $ — $ (5,464 ) $ (5,464 ) Derivative financial instruments — (40 ) — (40 ) $ — $ (40 ) $ (5,464 ) $ (5,504 ) Fair Value Measurements at March 31, 2017 Level 1 Level 2 Level 3 Total ASSETS: Cash and cash equivalents $ 304,880 $ — $ — $ 304,880 U.S. government and municipal obligations 40,628 80,273 — 120,901 Commercial paper — 29,469 — 29,469 Corporate bonds 7,956 — — 7,956 Certificate of deposits — 1,499 — 1,499 Derivative financial instruments — 110 — 110 $ 353,464 $ 111,351 $ — $ 464,815 LIABILITIES: Contingent purchase consideration $ — $ — $ (5,449 ) $ (5,449 ) Derivative financial instruments — (213 ) — (213 ) $ — $ (213 ) $ (5,449 ) $ (5,662 ) This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. On a recurring basis, the Company measures certain financial assets and liabilities at fair value, including marketable securities and derivative financial instruments. The Company’s Level 1 investments are classified as such because they are valued using quoted market prices or alternative pricing sources with reasonable levels of price transparency. The Company’s Level 2 investments are classified as such because fair value is calculated using market observable data for similar but not identical instruments, or a discounted cash flow model using the contractual interest rate as compared to the underlying interest yield curve. The Company classifies municipal obligations as Level 2 because the fair values are determined using quoted prices from markets the Company considers to be inactive. Commercial paper is classified as Level 2 because the Company uses market information from similar but not identical instruments and discounted cash flow models based on interest rate yield curves to determine fair value. The Company's derivative financial instruments consist of forward foreign exchange contracts and are classified as Level 2 because the fair values of these derivatives are determined using models based on market observable inputs, including spot prices for foreign currencies and credit derivatives, as well as an interest rate factor. The Company's Level 3 liabilities consist of contingent purchase consideration. The Company's contingent purchase consideration includes $523 thousand related to the acquisition of Efflux Systems, Inc. (Efflux) in the second quarter of fiscal year 2018. The contingent purchase consideration represents amounts deposited into an escrow account, which was established to cover damages NetScout might suffer related to any liabilities that NetScout did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the merger agreement. The contingent purchase consideration is included as accrued other in the Company's consolidated balance sheet at March 31, 2018 . The Company's contingent purchase consideration at March 31, 2017 included $660 thousand related to the acquisition of certain assets and liabilities of Avvasi Inc. (Avvasi) in the second quarter of fiscal year 2017. The contingent purchase consideration represented amounts deposited into an escrow account, which was established to cover damages the Company suffers related to any liabilities that the Company did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the merger agreement. The contingent purchase consideration was paid to the seller in August 2017. The fair value of contingent purchase consideration related to the acquisition of Simena LLC (Simena) in November 2011 for future consideration to be paid to the former seller is $4.9 million and $4.8 million at March 31, 2018 and 2017, respectively. The contingent purchase consideration is included as a contingent liability within accrued other in the Company's consolidated balance sheet at March 31, 2018 and as a long-term contingent liability at March 31, 2017 . The following table sets forth a reconciliation of changes in the fair value of the Company’s Level 3 financial liabilities for the year ended March 31, 2018 (in thousands): Contingent Purchase Consideration Balance at March 31, 2017 $ (5,449 ) Additions to Level 3 (523 ) Increase in fair value and accretion expense (included within research and development expense) (152 ) Payments made 660 Balance at March 31, 2018 $ (5,464 ) Deal-related compensation expense and accretion charges related to the contingent purchase consideration for the fiscal year ended March 31, 2018 were $152 thousand and were included as part of earnings. The following table sets forth a reconciliation of changes in the fair value of the Company’s Level 3 financial liabilities for the year ended March 31, 2017 (in thousands): Contingent Purchase Consideration Contingently Returnable Consideration Balance at March 31, 2016 $ (7,293 ) $ 16,131 Additions to Level 3 (660 ) — Increase in fair value and accretion expense (included within research and development expense) (153 ) — Decrease in fair value — (610 ) Gross presentation of contingently returnable consideration to contingent purchase consideration (3,910 ) 3,910 Payments received — (19,431 ) Payments made 6,567 — Balance at March 31, 2017 $ (5,449 ) $ — Deal related compensation expense, accretion charges and changes related to settlements of contractual non-compliance liabilities for the fiscal year ended March 31, 2017 were $153 thousand and were included as part of earnings. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Mar. 31, 2018 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories are stated at the lower of actual cost or net realizable value. Cost is determined by using the FIFO method. Inventories consist of the following (in thousands): March 31, 2018 2017 Raw materials $ 20,860 $ 22,305 Work in process 2,589 998 Finished goods and deferred costs 11,325 16,699 $ 34,774 $ 40,002 |
FIXED ASSETS
FIXED ASSETS | 12 Months Ended |
Mar. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
FIXED ASSETS | FIXED ASSETS Fixed assets consist of the following (in thousands): Estimated Useful Life in Years March 31, 2018 2017 Furniture and fixtures 3-7 $ 6,596 $ 6,436 Computer equipment and internal use software 3-5 147,237 135,100 Demonstration and spare part units 2-5 31,338 28,036 Leasehold improvements (1) up to 12 19,340 16,623 204,511 186,195 Less – accumulated depreciation (152,000 ) (124,802 ) $ 52,511 $ 61,393 (1) Leasehold improvements are depreciated over the shorter of the lease term or anticipated useful life of the improvement. Depreciation expense was $34.7 million , $33.0 million and $26.6 million for the fiscal years ended March 31, 2018 , 2017 and 2016 , respectively. |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
ACQUISITIONS | ACQUISITIONS Efflux On July 12, 2017 (the Efflux Closing Date), the Company completed the acquisition of Efflux for $8.6 million . Efflux's technology detects, analyzes and correlates threat activity within enterprise networks. The Efflux technology and engineering talent have been integrated into Arbor Networks in order to support the ongoing enhancement of Arbor Spectrum for advanced threat detection. The Company has completed the purchase accounting related to the Efflux acquisition. The following table summarizes the allocation of the purchase price (in thousands): Initial cash payment $ 8,104 Estimated fair value of contingent purchase consideration 523 Estimated purchase price $ 8,627 Estimated fair value of assets acquired and liabilities assumed (in thousands): Cash $ 93 Accounts receivable 3 Prepaid and other current assets 208 Property, plant and equipment 8 Intangible assets 2,590 Deferred tax asset 841 Accounts payable (7 ) Accrued other liabilities (200 ) Deferred revenue (8 ) Deferred tax liabilities (978 ) Goodwill $ 6,077 Of the total consideration, $523 thousand was deposited into an escrow account. The escrow account was established to cover damages NetScout suffers related to any liabilities that NetScout did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the merger agreement. Generally, indemnification claims that Efflux would be liable for are limited to the total amount of the escrow account such account and shall be the sole source for the satisfaction of any damages to the Company for such claims, but such limitation does not apply with respect to seller's breach of certain fundamental representations or related to other specified indemnity items, for which certain of Efflux's shareholders may be liable for additional amounts in excess of the escrow amount. The $523 thousand will be paid to the seller on July 12, 2018. In connection with the Efflux acquisition, certain former employees of Efflux will receive cash retention payments subject to such employee's continued employment with the Company through the next regularly scheduled payroll dates following each of the first and second anniversaries of the Efflux Closing Date. The cash retention payment liability was accounted for separately from the business combination as the cash retention payment is automatically forfeited upon termination of employment. The Company will record the liability over the period it is earned as compensation expense for post-combination services. Goodwill was recognized for the excess purchase price over the fair value of the net assets acquired. Goodwill of $6.1 million from the acquisition was included within the Security reporting unit. Goodwill and intangible assets recorded as part of the acquisition are not deductible for tax purposes. The fair values of intangible assets were based on valuations using an income approach. These assumptions include estimates of future revenues associated with the technology purchased as part of the acquisition and the migration of the current technology to a more advanced version of the software. This fair value measurement was based on significant inputs not observable in the market and thus represents Level 3 fair value measurements. The following table reflects the fair value of the acquired identifiable intangible assets and related estimates of useful lives (in thousands): Fair Value Useful Life (Years) Developed technology $ 1,980 10 Customer relationships 610 10 $ 2,590 The weighted average useful life of identifiable intangible assets acquired from Efflux is 10 years. Avvasi On August 19, 2016, the Company acquired certain assets and liabilities of Avvasi for $4.6 million . Avvasi’s technology allows service providers to measure, improve and monetize video in their networks. This acquisition builds on the Company's ongoing investment in enhancing its service assurance capabilities for video traffic over 4G/LTE networks. Goodwill was recognized for the excess purchase price over the fair value of the net assets acquired. Goodwill of $2.0 million from the acquisition was included within the Service Assurance reporting unit. Communications Business On July 14, 2015 (Closing Date), the Company completed the Comms Transaction, which was structured as a Reverse Morris Trust transaction whereby Danaher contributed its Communications Business to a new subsidiary, Potomac Holding LLC (Newco). The total equity consideration was approximately $2.3 billion based on issuing approximately 62.5 million new shares of NetScout common stock to the existing common unit holders of Newco, based on the July 13, 2015 NetScout common stock closing share price of $36.89 per share. On the Closing Date, the Company did not gain control over certain foreign entities due to regulatory and other compliance requirements (Delayed Close Entities). The Company closed on the acquisition of these Delayed Close Entities on October 7, 2015. In connection with the Comms Transaction, under the Employee Matters Agreement dated July 14, 2015 by and among the Company, Danaher and Newco, Danaher funded certain contracts under which employees provided post-combination services to the Company. 1) For any outstanding Danaher restricted stock units or stock options held by employees of the Communications Business transferred to Newco (Newco Employees) that vested from July 14, 2015 through August 4, 2015, the awards continued to vest in Danaher shares. These awards met the definition of a derivative under ASC 815 and as such, the Company determined the fair value of these awards on July 14, 2015 and recorded them separately from the business combination as prepaid compensation. The derivative was amortized into compensation expense through August 4, 2015, the post-combination requisite settlement date. The total amount of compensation expense for post-combination services recorded for fiscal years ended March 31, 2018 , 2017, and 2016 was $0 , $0 and $6.5 million , respectively. 2) All outstanding Danaher restricted stock units or stock options held by Newco Employees that were due to vest after August 4, 2015 were canceled and replaced by NetScout with a cash retention award equal to one half of the value of the employee’s canceled Danaher equity award and up to an aggregate of $15 million of restricted stock units relating to shares of NetScout common stock equal to the remaining one half of the value of the employee’s canceled Danaher equity award. The restricted stock units issued are considered new share-based payment awards granted by NetScout to the former employees of Danaher. NetScout accounted for these new awards separately from the business combination. The Company recognized share-based compensation net of an estimated forfeiture rate and only recognized compensation cost for those shares expected to vest on a straight-line basis over the requisite service period of the award. The cash retention award was paid on August 4, 2016, to those employees that continued their employment with NetScout through the applicable vesting date of August 4, 2016. Danaher reimbursed NetScout for the amount of the cash retention payments (net of any applicable employment taxes and tax deductions). The cash retention award liability was accounted for separately from the business combination as the cash retention award was automatically forfeited upon termination of employment. NetScout recorded the cash retention award liability over the period it was earned as compensation expense for post-combination services. The reimbursement by Danaher to NetScout of the cash retention award payment was accounted for separately from the business combination on the date of the acquisition. For the fiscal years ended March 31, 2018 , 2017, and 2016, $0 , $4.3 million and $8.0 million , respectively, has been recorded as compensation expense for post-combination services. 3) Newco Employees that were entitled to receive an incentive bonus under the Danaher annual bonus plan and who continued to be employed by NetScout through December 31, 2015 received a cash incentive bonus payment. The cash incentive bonus liability was accounted for separately from the business combination as the cash incentive bonus is automatically forfeited upon termination of employment. NetScout recorded the liability over the period it was earned as compensation expense for post-combination services. The payment of the cash retention award, which was reimbursed by Danaher to NetScout, was accounted for separately from the business combination on the date of the acquisition. For the fiscal years ended March 31, 2018 , 2017, and 2016, $0 , $0 and $9.3 million , respectively, was recorded as compensation expense for post-combination services. 4) Certain Newco Employees received cash retention payments that were subject to the employee’s continued employment with NetScout through October 16, 2015, ninety (90) days after the close of the acquisition. The cash retention payment liability was accounted for separately from the business combination as the cash retention payment was automatically forfeited upon termination of employment. NetScout recorded the liability over the period it was earned as compensation expense for post-combination services. The payment of the cash retention award, which was reimbursed by Danaher to NetScout, was accounted for separately from the business combination on the date of the acquisition. For the fiscal year ended March 31, 2018 , 2017 and 2016, $0 , $0 and $7.8 million , respectively, was recorded as compensation expense for post-combination services. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL & INTANGIBLE ASSETS Goodwill The Company has two reporting units: (1) Service Assurance and (2) Security. At March 31, 2018 , goodwill attributable to the Company's Service Assurance and Security reporting units was $1.2 billion and $555.9 million , respectively. At March 31, 2017 , goodwill attributable to the Company's Service Assurance and Security reporting units was $1.2 billion and $548.5 million , respectively. Goodwill is tested for impairment at a reporting unit level at least annually, or on an interim basis if an event occurs or circumstances change that would, more likely than not, reduce the fair value of the reporting unit below its carrying value. The Company completed its annual impairment test on January 31, 2018 . In fiscal years 2018 and 2017, the Company's quantitative impairment tests indicated that goodwill was not impaired. The Company determined the fair values of its reporting units by preparing a discounted cash flow analysis using forward looking projections of the reporting units’ future operating results and by comparing the value of the reporting units to the implied market value of selected peers. The significant assumptions used in the discounted cash flow analysis include: revenue and revenue growth, selling margins, other operating expenditures, the discounted rate used to present value future cash flows and terminal growth rates. The discount rate used is a cost of equity method, which is essentially equal to the "market participant" weighted-average cost of capital (WACC). The Service Assurance and Security reporting units' goodwill fair value substantially exceeded their respective carrying value. The change in the carrying amount of goodwill for the fiscal year ended March 31, 2018 is due to the acquisition of Efflux and the impact of foreign currency translation adjustments related to asset balances that are recorded in currencies other than the U.S. Dollar. The changes in the carrying amount of goodwill for the fiscal years ended March 31, 2018 and 2017 are as follows (in thousands): Balance at March 31, 2016 $ 1,709,369 Goodwill attributable to the Avvasi acquisition 1,950 Purchase accounting adjustments 3,792 Foreign currency translation impact and other adjustments 3,051 Balance at March 31, 2017 $ 1,718,162 Goodwill attributable to the Efflux acquisition 6,077 Foreign currency translation impact (11,475 ) Balance as of March 31, 2018 $ 1,712,764 Intangible Assets The net carrying amounts of intangible assets were $831.4 million and $931.3 million at March 31, 2018 and 2017 , respectively. Intangible assets acquired in a business combination are recorded under the acquisition method of accounting at their estimated fair values at the date of acquisition. The Company amortizes intangible assets over their estimated useful lives, except for the acquired trade name which resulted from the Network General acquisition, which has an indefinite life and thus is not amortized. The carrying value of the indefinite lived trade name is evaluated for potential impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. In fiscal year 2018 and 2017 , the Company's annual impairment tests indicated that the acquired trade name was not impaired. In the fourth quarter of fiscal year 2018, the Company performed a quantitative step 1 analysis of its non-amortizing trade name. The Company determined the fair value of its trade name using a forward-looking relief from royalty model. The significant assumptions used in the forward-looking relief from royalty method include: revenue growth, royalty rates and the discount rate. The non-amortizing trade name fair value substantially exceeded its carrying value. During the fiscal years ended March 31, 2018 and 2017 , the Company acquired technology licenses for $0.5 million and $1.0 million , respectively. These amounts are included within distributor relationships and are being amortized using the economic benefit method over a useful life of 3 years. Intangible assets include the indefinite lived trade name with a carrying value of $18.6 million and the following amortizable intangible assets at March 31, 2018 (in thousands): Cost Accumulated Amortization Net Developed technology $ 259,758 $ (148,937 ) $ 110,821 Customer relationships 845,490 (176,425 ) 669,065 Distributor relationships and technology licenses 9,019 (5,389 ) 3,630 Definite-lived trademark and trade name 44,387 (18,138 ) 26,249 Core technology 7,345 (6,712 ) 633 Net beneficial leases 336 (336 ) — Non-compete agreements 317 (317 ) — Leasehold interest 2,600 (2,130 ) 470 Backlog 18,544 (18,544 ) — Capitalized software 3,183 (1,621 ) 1,562 Other 1,247 (903 ) 344 $ 1,192,226 $ (379,452 ) $ 812,774 Intangible assets include the indefinite lived trade name with a carrying value of $18.6 million and the following amortizable intangible assets at March 31, 2017 (in thousands): Cost Accumulated Amortization Net Developed technology $ 254,005 $ (110,200 ) $ 143,805 Customer relationships 831,731 (105,319 ) 726,412 Distributor relationships and technology licenses 8,290 (3,068 ) 5,222 Definite-lived trademark and trade name 43,817 (12,078 ) 31,739 Core technology 7,108 (6,009 ) 1,099 Net beneficial leases 336 (336 ) — Non-compete agreements 278 (278 ) — Leasehold interest 2,600 (998 ) 1,602 Backlog 18,142 (18,133 ) 9 Capitalized software 3,047 (594 ) 2,453 Other 1,208 (880 ) 328 $ 1,170,562 $ (257,893 ) $ 912,669 Amortization included as product revenue consists of amortization of backlog. Amortization included as cost of product revenue consists of amortization of developed technology, distributor relationships and technology licenses, core technology and software. Amortization included as operating expense consists of all other intangible assets. The following table provides a summary of amortization expense during the fiscal years ended March 31, 2018 , 2017 , and 2016 (in thousands). Years Ended March 31, 2018 2017 2016 Amortization of intangible assets included as: Product revenue $ 9 $ 11,438 $ 6,747 Cost of product revenue 40,286 44,326 45,127 Operating expense 76,661 70,325 32,547 $ 116,956 $ 126,089 $ 84,421 The following is the expected future amortization expense at March 31, 2018 for the fiscal years ended March 31 (in thousands): 2019 $ 130,108 2020 116,494 2021 80,232 2022 69,778 2023 62,045 Thereafter 354,117 Total $ 812,774 The weighted average amortization period of developed technology and core technology is 11.5 years. The weighted average amortization period for customer and distributor relationships is 16.1 years. The weighted average amortization period for trademarks and trade names is 8.5 years. The weighted average amortization period for leasehold interests is 5.6 years . The weighted average amortization period for backlog is 2.0 years . The weighted average amortization period for capitalized software is 4.0 years . The weighted average amortization period for all amortizing intangible assets is 14.6 years. |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 12 Months Ended |
Mar. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES NetScout operates internationally and, in the normal course of business, is exposed to fluctuations in foreign currency exchange rates. The exposures result from costs that are denominated in currencies other than the U.S. Dollar, primarily the Euro, British Pound, Canadian Dollar, and Indian Rupee. The Company manages its foreign cash flow risk by hedging forecasted cash flows for operating expenses denominated in foreign currencies for up to twelve months, within specified guidelines through the use of forward contracts. The Company enters into foreign currency exchange contracts to hedge cash flow exposures from costs that are denominated in currencies other than the U.S. Dollar. These hedges are designated as cash flow hedges at inception. All of the Company’s derivative instruments are utilized for risk management purposes, and the Company does not use derivatives for speculative trading purposes. These contracts will mature over the next twelve months and are expected to impact earnings on or before maturity. The notional amounts and fair values of derivative instruments in the consolidated balance sheets at March 31, 2018 and 2017 were as follows (in thousands): Notional Amounts (a) Prepaid Expenses and Other Current Assets Accrued Other March 31, 2018 March 31, 2017 March 31, 2018 March 31, 2017 March 31, 2018 March 31, 2017 Derivatives Designated as Hedging Instruments: Forward contracts $ 11,225 $ 14,752 $ 122 $ 110 $ 40 $ 213 (a) Notional amounts represent the gross contract/notional amount of the derivatives outstanding. The following table provides the effect foreign exchange forward contracts had on other comprehensive income (loss), (OCI) and results of operations at March 31, 2018 and 2017 (in thousands): Derivatives in Cash Flow Hedging Relationships Effective Portion Ineffective Portion Gain (Loss) Recognized in OCI on Derivative (a) Gain (Loss) Reclassified from Accumulated OCI into Income (b) Gain (Loss) Recognized in Income (Amount Excluded from Effectiveness Testing) (c) March 31, March 31, March 31, March 31, March 31, March 31, 2018 2017 Location 2018 2017 Location 2018 2017 Forward contracts $ 1,079 $ (444 ) Research and development $ (121 ) $ (3 ) Research and development $ 60 $ 74 Sales and marketing (779 ) 361 Sales and marketing (153 ) (183 ) $ 1,079 $ (444 ) $ (900 ) $ 358 $ (93 ) $ (109 ) (a) The amount represents the change in fair value of derivative contracts due to changes in spot rates. (b) The amount represents reclassification from other comprehensive income to earnings that occurs when the hedged item affects earnings. (c) The amount represents the change in fair value of derivative contracts due to changes in the difference between the spot price and forward price that is excluded from the assessment of hedge effectiveness and therefore recognized in earnings. No gains or losses were reclassified as a result of discontinuance of cash flow hedges. |
RESTRUCTURING CHARGES
RESTRUCTURING CHARGES | 12 Months Ended |
Mar. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | RESTRUCTURING CHARGES During the fiscal year ended March 31, 2016, the Company recorded a restructuring charge of $500 thousand related to one-time termination benefits to be paid to one employee, which was the completion of a plan that was required as a closing condition for the Comms Transaction. During the fiscal year ended March 31, 2017, the Company approved two restructuring plans. During the quarter ended June 30, 2016, the Company restructured certain departments to better align functions subsequent to the Comms Transaction. As a result of the restructuring program, the Company recorded $2.0 million of restructuring charges related to one-time termination benefits to be paid to nineteen employees which was recorded during the fiscal year ended March 31, 2017. The one-time termination benefits related to this plan were paid in full during the fiscal year ended March 31, 2017. In addition, during the quarter ended March 31, 2017, the Company restructured certain departments to better align functions subsequent to the Comms Transaction, resulting in the termination of forty-one employees. Communication of the plan to the impacted employees was substantially completed on March 31, 2017. As a result of the workforce reduction, during the fiscal year ended March 31, 2017, the Company recorded a restructuring change totaling $1.9 million related to one-time termination benefits and $0.4 million in facility related charges. All of the workforce reduction was completed during the quarter ended September 30, 2017. During the fiscal year ended March 31, 2018, the Company recorded an additional charge for one-time termination benefits and facility-related costs of $0.9 million . The one-time termination benefits and facilities-related costs related to this plan were paid in full during the fiscal year ended March 31, 2018. During the fiscal year ended March 31, 2018, the Company restructured certain departments to better align functions resulting in the termination of sixty-one employees. As a result of the workforce reduction, during the twelve months ended March 31, 2018, the Company recorded a restructuring charge totaling $5.1 million related to one-time termination benefits for the employees that were notified during the period. Additional one-time termination benefit charges and facility-related costs of approximately $1.7 million are anticipated to be recorded in the next six months. The one-time termination benefits will be paid in full during the fiscal year ending March 31, 2019. The following table provides a summary of the activity related to the restructuring plans and the related restructuring liability (in thousands): Q3 FY2016 Plan Q1 FY2017 Plan Q4 FY2017 Plan Q3 FY2018 Plan Employee-Related Employee-Related Employee-Related Facilities Related Employee-Related Total Balance at March 31, 2016 $ 272 $ — $ — $ — $ — $ 272 Restructuring charges to operations — 2,034 1,867 405 — 4,306 Cash payments (272 ) (1,739 ) (317 ) — — (2,328 ) Other adjustments — (295 ) — — — (295 ) Balance at March 31, 2017 $ — $ — $ 1,550 $ 405 $ — $ 1,955 Restructuring charges to operations — — 729 208 5,085 6,022 Cash payments — — (1,867 ) (374 ) (1,331 ) (3,572 ) Other adjustments — — (412 ) (239 ) (58 ) (709 ) Balance at March 31, 2018 $ — $ — $ — $ — $ 3,696 $ 3,696 The accrual for employee-related severance is included as accrued compensation in the Company's consolidated balance sheets. The balance is expected to be paid in full in the next twelve months. The accruals for facilities-related exit costs are included as accrued other and other long-term liabilities. |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT On January 16, 2018, the Company amended and expanded its existing credit agreement (Amended Credit Agreement) with a syndicate of lenders by and among: the Company; JPMorgan Chase Bank, N.A. (JPMorgan), as administrative agent and collateral agent; J.P. Morgan Securities LLC, KeyBanc Capital Markets, Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBC Capital Markets and Wells Fargo Securities, LLC, as joint lead arrangers and joint bookrunners; Fifth Third Bank, Santander Bank, N.A., SunTrust Bank, N.A. and U.S. Bank National Association, as co-documentation agents; and the lenders party thereto. The Amended Credit Agreement provides for a five -year $1.0 billion senior secured revolving credit facility, including a letter of credit sub-facility of up to $75.0 million. The Company may elect to use the new credit facility for general corporate purposes or to finance the repurchase of the Company's common stock under the Company's common stock repurchase plan. The commitments under the Amended Credit Agreement will expire on January 16, 2023, and any outstanding loans will be due on that date. On February 1, 2018, the Company also announced that it entered into agreements with JPMorgan Chase Bank, National Association and Bank of America, N.A. (the Dealers) to repurchase an aggregate of $300 million of the Company's common stock via accelerated stock repurchase transactions (the ASR) under the Company's previously disclosed share repurchase program. On February 1, 2018, the Company borrowed an additional $300 million aggregate principal amount under its Amended Credit Agreement in order to finance the payment of the ASR to each of the Dealers. At March 31, 2018 , $600 million was outstanding under the Amended Credit Agreement. At the Company’s election, revolving loans under the Amended Credit Agreement bear interest at either (a) an Alternate Base Rate per annum equal to the greatest of (1) JPMorgan’s prime rate, (2) 0.50% in excess of the New York Federal Reserve Bank (NYFRB) rate, or (3) an adjusted one month LIBOR rate plus 1% ; or (b) such adjusted LIBOR rate (for the interest period selected by the Company), in each case plus an applicable margin. For the period from the delivery of the Company's financial statements for the quarter ended December 31, 2017, until the Company has delivered financial statements for the quarter ended March 31, 2018 , the applicable margin will be 1.50% per annum for LIBOR loans and 0.50% per annum for Alternate Base Rate loans, and thereafter the applicable margin will vary depending on the Company’s leverage ratio, ranging from 1.00% per annum for Base Rate loans and 2.00% per annum for LIBOR loans if the Company’s consolidated leverage ratio is greater than 3.50 to 1.00, down to 0.00% per annum for Alternate Base Rate loans and 1.00% per annum for LIBOR loans if the Company’s consolidated leverage ratio is equal to or less than 1.50 to 1.00. The Company’s consolidated leverage ratio is the ratio of its total funded debt compared to its consolidated adjusted EBITDA. Consolidated adjusted EBITDA includes certain adjustments, including, without limitation, adjustments relating to extraordinary, unusual or non-recurring charges, certain restructuring charges, non-cash charges, certain transaction costs and expenses and certain pro forma adjustments in connection with material acquisitions and dispositions, all as set forth in detail in the definition of consolidated adjusted EBITDA in the Amended Credit Agreement. Commitment fees will accrue on the daily unused amount of the credit facility. For the period from the delivery of the Company's financial statements for the quarter ended December 31, 2017 until the Company has delivered financial statements for the quarter ended March 31, 2018 , the commitment fee will be 0.25% per annum, and thereafter the commitment fee will vary depending on the Company’s consolidated leverage ratio, ranging from 0.30% per annum if the Company’s consolidated leverage ratio is greater than 2.75 to 1.00, down to 0.15% per annum if the Company’s consolidated leverage ratio is equal to or less than 1.50 to 1.00. Letter of credit participation fees are payable to each lender on the amount of such lender’s letter of credit exposure, during the period from the closing date of the Amended Credit Agreement to but excluding the date which is the later of (i) the date on which such lender’s commitment terminates or (ii) the date on which such lender ceases to have any letter of credit exposure, at a rate per annum equal to the applicable margin for LIBOR loans. Additionally, the Company will pay a fronting fee to each issuing bank in amounts to be agreed to between the Company and the applicable issuing bank. Interest on Alternate Base Rate loans is payable at the end of each calendar quarter. Interest on LIBOR loans is payable at the end of each interest rate period or at the end of each three-month interval within an interest rate period if the period is longer than three months. The Company may also prepay loans under the Amended Credit Agreement at any time, without penalty, subject to certain notice requirements. Debt is recorded at the amount drawn on the revolving credit facility plus interest based on floating rates reflective of changes in the market which approximates fair value. The loans and other obligations under the credit facility are (a) guaranteed by each of the Company’s wholly owned material domestic restricted subsidiaries, subject to certain exceptions, and (b) are secured by substantially all of the assets of the Company and the subsidiary guarantors, including a pledge of all the capital stock of material subsidiaries held directly by the Company and the subsidiary guarantors (which pledge, in the case of any foreign subsidiary, is limited to 65% of the voting stock), subject to certain customary exceptions and limitations. The Amended Credit Agreement generally prohibits any other liens on the assets of the Company and its restricted subsidiaries, subject to certain exceptions as described in the Amended Credit Agreement. The Amended Credit Agreement contains certain covenants applicable to the Company and its restricted subsidiaries, including, without limitation, limitations on additional indebtedness, liens, various fundamental changes, dividends and distributions, investments (including acquisitions), transactions with affiliates, asset sales, including sale-leaseback transactions, speculative hedge agreements, payment of junior financing, changes in business and other limitations customary in senior secured credit facilities. In addition, the Company is required to maintain certain consolidated leverage and interest coverage ratios. These covenants and limitations are more fully described in the Amended Credit Agreement. At March 31, 2018 , the Company was in compliance with all of these covenants. The Amended Credit Agreement provides that events of default will exist in certain circumstances, including failure to make payment of principal or interest on the loans when required, failure to perform certain obligations under the Amended Credit Agreement and related documents, defaults under certain other indebtedness, certain insolvency events, certain events arising under ERISA, a change of control and certain other events. Upon an event of default, the administrative agent with the consent of, or at the request of, the holders of more than 50% in principal amount of the loans and commitments may terminate the commitments and accelerate the maturity of the loans and enforce certain other remedies under the Amended Credit Agreement and the other loan documents. In connection with the Company's Amended Credit Agreement described above, the Company terminated its previous term loan dated as of July 14, 2015, by and among the Company; JPMorgan Chase Bank, N.A. (JPMorgan), as administrative agent and collateral agent; J.P. Morgan Securities LLC, KeyBanc Capital Markets, Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBC Capital Markets and Wells Fargo Securities, LLC, as joint lead arrangers and joint bookrunners; Santander Bank, N.A., SunTrust Bank, N.A. and U.S. Bank National Association, as co-documentation agents; and the lenders party thereto. The Company has capitalized debt issuance costs totaling $12.2 million at March 31, 2018, which are being amortized over the life of the revolving credit facility. The unamortized balance was $8.3 million as of March 31, 2018 . The balance of $1.7 million was included as prepaid expenses and other current assets and a balance of $6.6 million was included as other assets in Company’s consolidated balance sheet. |
NET INCOME (LOSS) PER SHARE
NET INCOME (LOSS) PER SHARE | 12 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
NET INCOME (LOSS) PER SHARE | NET INCOME (LOSS) PER SHARE Calculations of the basic and diluted net income (loss) per share and potential common shares are as follows (in thousands, except for per share data): Year Ended March 31, 2018 2017 2016 Numerator: Net income (loss) $ 79,812 $ 33,291 $ (28,369 ) Denominator: Denominator for basic net income (loss) per share - weighted average common shares outstanding 87,425 92,226 81,927 Dilutive common equivalent shares: Weighted average restricted stock units 836 694 — Denominator for diluted net income (loss) per share - weighted average shares outstanding 88,261 92,920 81,927 Net income (loss) per share: Basic net income (loss) per share $ 0.91 $ 0.36 $ (0.35 ) Diluted net income (loss) per share $ 0.90 $ 0.36 $ (0.35 ) The following table sets forth options and restricted stock units excluded from the calculation of diluted net income per share, since their inclusion would be antidilutive (in thousands): Year Ended March 31, 2018 2017 2016 Restricted stock units 1,450 1,320 453 Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted average number of shares outstanding during the period. Unvested restricted shares, although legally issued and outstanding, are not considered outstanding for purposes of calculating basic earnings per share. Diluted net income (loss) per share is calculated by dividing net income (loss) by the weighted average number of shares outstanding plus the dilutive effect, if any, of outstanding restricted shares and restricted stock units using the treasury stock method. The calculation of the dilutive effect of outstanding equity awards under the treasury stock method includes consideration of proceeds from the assumed exercise of unrecognized compensation expense. As we incurred a net loss in the fiscal year ended March 31, 2016, all outstanding restricted stock units have an anti-dilutive effect and are therefore excluded from the computation of diluted weighted average share outstanding. The delivery of 7.4 million shares under the Company's accelerated share repurchase (ASR) agreements reduced our outstanding shares used to determine our weighted average common shares outstanding for purposes of calculating basic and diluted earnings per share for the fiscal year ended March 31, 2018. See Note 13 for additional information. We evaluated the ASR agreements for potential dilutive effects of any shares remaining to be received or owed upon settlement and determined the additional shares to be received would be anti-dilutive, and therefore they were not included in our calculation of diluted earnings per share for the fiscal year ended March 31, 2018. |
TREASURY STOCK
TREASURY STOCK | 12 Months Ended |
Mar. 31, 2018 | |
Equity [Abstract] | |
TREASURY STOCK | TREASURY STOCK On April 22, 2014, the Company's Board of Directors approved a stock repurchase program. This program authorized management to make repurchases of NetScout outstanding common stock of up to $100 million . Through July 15, 2015, the Company had repurchased 824,452 shares totaling $ 34.3 million in the open market under this stock repurchase plan. The Company repurchased 67,752 shares for $2.8 million under the program during the fiscal year ended March 31, 2016. At March 31, 2018, there were no shares of common stock that remained available to be purchased under this plan due to the approval of another share repurchase program approved on May 19, 2015. On May 19, 2015, the Company’s Board of Directors approved a share repurchase program, conditional upon the completion of the Comms Transaction. This program enabled the Company to repurchase up to 20 million shares of its common stock. This plan became effective on July 14, 2015 upon the completion of the Comms Transaction and replaced the Company's previously existing open market stock repurchase program described above. The Company was not obligated to acquire any specific amount of common stock within any particular timeframe under this program. The Company repurchased 6,773,438 shares for $227.6 million , 3,148,426 shares for $80.0 million and 10,078,136 shares for $300.0 million in the open market under this stock repurchase plan during the fiscal years ended March 31, 2018 , 2017 and 2016, respectively. At March 31, 2018 , there were no shares of common stock that remained available to be purchased under this plan. On October 24, 2017, the Company’s Board of Directors approved a new share repurchase program that enables the Company to repurchase up to twenty-five million shares of its common stock. This new program became effective once the Company’s previously disclosed twenty million share repurchase program was completed. The Company is not obligated to acquire any specific amount of common stock within any particular timeframe as a result of its new share repurchase program. On February 1, 2018, the Company entered into ASR agreements with two third-party financial institutions (the Dealers) to repurchase an aggregate of $300 million of the Company's common stock via accelerated stock repurchase transactions under the Company’s twenty million share repurchase program and the twenty five million share repurchase program. The Company borrowed $300 million against its Amended Credit Facility in order to finance the payment of the initial purchase price to each of the Dealers. Under the terms of the ASR, the Company made a $150 million payment to each of the Dealers on February 2, 2018, and received an initial delivery of 3,693,931 shares from each of the Dealers, or 7,387,862 shares in the aggregate, which is approximately 70 percent of the total number of shares of the Company's common stock expected to be repurchased under the ASR. As part of this purchase, 970,650 shares for $27.6 million were deducted under the twenty million share repurchase program and 6,417,212 shares for $182.4 million were deducted from the twenty-five million share repurchase program. The final number of ASR shares is dependent upon the average of the daily volume-weighted average prices of the Company’s common stock during the term of the ASR, less a discount and subject to adjustments pursuant to the terms and conditions of the ASR. The delivery of additional shares of common stock to the Company or an additional delivery of shares of common stock or a cash payment, at NetScout's election, by the Company to the Dealers may be required. The final settlement of each of the ASR transactions is expected to occur no later than the end of the second quarter of fiscal year 2019. At March 31, 2018, 18,582,788 shares of common stock remained available to be purchased under the current program. In connection with the vesting and release of the restriction on previously vested shares of restricted stock, the Company repurchased 408,097 shares for $13.6 million , 320,572 shares for $9.6 million and 256,514 shares for $9.1 million related to minimum statutory tax withholding requirements on these restricted stock units during the fiscal years ended March 31, 2018 , 2017 and 2016 , respectively. These repurchase transactions do not fall under the repurchase program described above, and therefore do not reduce the amount that is available for repurchase under those programs. |
STOCK PLANS
STOCK PLANS | 12 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK PLANS | STOCK PLANS 2011 Employee Stock Purchase Plan On September 7, 2011, the Company’s stockholders approved the 2011 Employee Stock Purchase Plan (the ESPP), under which 2,500,000 shares of the Company’s common stock have been reserved for issuance. The Company implemented the ESPP on March 1, 2012. Eligible employees may purchase shares of the Company’s common stock through regular payroll deductions of up to 20% of their eligible compensation. Under the terms of the offering under the ESPP, the number of shares of the Company’s common stock which a participant could purchase during any purchase period is limited to 2,000 . In addition, the fair market value of shares purchased by an individual participant in the plan may not exceed $25,000 if the contribution period is within any calendar year. However, if contribution periods overlap calendar years, an individual participant is eligible to utilize the unused portion of the $25,000 limit from the subsequent purchase in the current purchase up to $50,000 . Under the ESPP, shares of the company's common stock may be purchased on the last day of each bi-annual offering period at 85% of the fair market value on the last day of such offering period. The offering periods run from March 1 through August 31 and from September 1 through the last day of February of each year. During the fiscal year ended March 31, 2018 , employees purchased 610,947 shares under the ESPP with a weighted average purchase price per share of $29.22 . At March 31, 2018 , 485,143 shares were available for future issuance under the ESPP. 2007 Equity Incentive Plan Enacted in September 2007, the 2007 Equity Incentive Plan (2007 Plan) permits the granting of stock options, restricted stock and restricted stock units, collectively referred to as “share-based awards.” Periodically, the Company grants share-based awards to employees and officers of the Company and its subsidiaries. The Company accounts for these share-based awards in accordance with GAAP, which requires the measurement and recognition of compensation expense based on estimated fair values for all share-based payment awards made to its employees and directors. Share-based award grants are generally measured at fair value on the date of grant based on the number of shares granted and the quoted price of the Company’s common stock. Such value is recognized as a cost of revenue or an operating expense over the corresponding vesting period. On September 7, 2011, the Company’s stockholders approved an amendment and restatement of the 2007 Equity Incentive Plan to increase the shares of common stock reserved for issuance by 8,000,000 shares. On September 22, 2015, the Company's stockholders approved an amendment and restatement of the 2007 Equity Incentive Plan (the Amended 2007 Plan) to increase the shares of common stock reserved for issuance by 8,500,000 . A total of 21,500,000 shares are reserved for issuance under the Amended 2007 Plan. In addition, any shares not delivered to a participant because an award is exercised through a reduction of shares subject to the award (cashless exercise) will not be available for issuance under the Amended 2007 Plan and any shares reacquired by the Company to cover withholding taxes upon exercise of a stock option or stock appreciation right or as consideration for the exercise of a stock option or stock appreciation right will not become available for issuance under the Amended 2007 Plan. Shares withheld to cover tax liabilities of restricted stock unit grants will be restored to the available reserve on the 2 for 1 amount. Furthermore, the share reserve under the Amended 2007 Plan is reduced one share for each share of common stock issued pursuant to a stock option or stock appreciation right and two shares for each share of common stock issued pursuant to restricted stock, restricted stock units, performance stock awards, or other stock awards granted under the Amended 2007 Plan on or after March 31, 2011. At March 31, 2018 , an aggregate of 4,078,780 unvested equity awards were outstanding under the Amended 2007 Plan. The Amended 2007 Plan is administered by the Compensation Committee of the Board of Directors. The Compensation Committee operates under guidelines established by the Board of Directors. The Compensation Committee has the authority to select the employees and consultants to whom awards are granted (except for directors and executive officers) and determine the terms of each award, including the number of shares of common stock subject to the award. Share-based awards generally vest over four years. The exercise price of incentive stock options shall not be less than 100% of the fair market value of the common stock at the date of grant ( 110% for incentive stock options granted to holders of more than 10% of the voting stock of NetScout). The term of options granted cannot exceed ten years ( five years for incentive stock options granted to holders of more than 10% of the voting stock of NetScout). Based on historical experience, the Company assumed an annualized forfeiture rate of 0% for awards granted to its independent directors, approximately 2% for awards granted to its senior executives, and approximately 5% granted to all remaining employees during the fiscal years ended March 31, 2018 , 2017 and 2016 . The following is a summary of share-based compensation expense including restricted stock units and employee stock purchases made under our employee stock purchase plan (ESPP) based on estimated fair values within the applicable cost and expense lines identified below (in thousands): Year Ended March 31, 2018 2017 2016 Cost of product revenue $ 1,159 $ 934 $ 645 Cost of service revenue 4,824 3,956 2,601 Research and development 14,711 12,362 9,205 Sales and marketing 15,213 12,823 8,725 General and administrative 11,410 9,114 7,175 $ 47,317 $ 39,189 $ 28,351 Transactions under the Amended 2007 Plan during the fiscal years ended March 31, 2018 , 2017 and 2016 are summarized in the table below. Restricted Stock Units Number of Awards Weighted Average Fair Value Outstanding – March 31, 2015 1,929,315 $ 30.18 Granted 1,806,490 37.20 Vested (736,170 ) 26.52 Canceled (126,329 ) 34.99 Outstanding – March 31, 2016 2,873,306 $ 35.32 Granted 2,020,536 24.92 Vested (950,159 ) 33.16 Canceled (333,382 ) 33.40 Outstanding – March 31, 2017 3,610,301 $ 30.24 Granted 1,962,590 34.01 Vested (1,216,585 ) 31.09 Canceled (277,526 ) 31.70 Outstanding – March 31, 2018 4,078,780 $ 31.77 At March 31, 2018 , there were 6,048,327 shares of common stock available for grant under the Amended 2007 Plan. The Company does not currently expect to repurchase shares from any source to satisfy its obligations under the Amended 2007 Plan. The aggregate intrinsic value of stock options exercised and the fair value of restricted stock units vested at March 31, 2018 , 2017 and 2016 were as follows (in thousands): Year Ended March 31, 2018 2017 2016 Total fair value of restricted stock unit awards vested $ 40,539 $ 28,293 $ 25,936 At March 31, 2018 , the total unrecognized compensation cost related to restricted stock unit awards was $100.8 million , which is expected to be amortized over a weighted-average period of 1.4 years. |
PENSION BENEFIT PLANS
PENSION BENEFIT PLANS | 12 Months Ended |
Mar. 31, 2018 | |
Retirement Benefits [Abstract] | |
PENSION BENEFIT PLANS | PENSION BENEFIT PLANS 401(k) Plan The Company has a defined contribution program for certain employees that is qualified under Section 401(k) of the Internal Revenue Code of 1986, as amended. The Company matches 50% of the employee’s contribution up to 6% of the employee’s salary. NetScout contributions vest at a rate of 25% per year of service. NetScout made matching contributions of $8.0 million , $9.4 million and $7.8 million to the plan for the fiscal years ended March 31, 2018 , 2017 and 2016 , respectively. Defined Benefit Pension Plan Certain of the Company's non-U.S. employees participate in certain noncontributory defined benefit pension plans acquired in the Comms Transaction on July 14, 2015. None of the Company's employees in the U.S. participate in any noncontributory defined benefit pension plans. In general, these plans are funded based on considerations relating to legal requirements, underlying asset returns, the plan’s funded status, the anticipated deductibility of the contribution, local practices, market conditions, interest rates and other factors. The components of the change in benefit obligation of the pension plan is as follows (in thousands): March 31, March 31, 2018 2017 Benefit obligation, at beginning of year $ 30,141 $ 29,188 Service cost 407 329 Interest cost 718 638 Benefits paid and other (288 ) (231 ) Actuarial loss (gain) (1,788 ) 1,226 Foreign exchange rate impact 4,274 (1,009 ) Benefit obligation, at end of year $ 33,464 $ 30,141 The reconciliation of the beginning and ending balances of the fair value of the assets of the pension plan is as follows (in thousands): March 31, March 31, 2018 2017 Fair value of plan assets, at beginning of year $ — $ — Employer direct benefit payments 288 231 Benefits paid and other (288 ) (231 ) Fair value of plan assets, at end of year $ — $ — The following sets forth the components of the Company's net periodic pension cost of the noncontributory defined benefit pension plans for the fiscal years ended March 31, 2018 , 2017 , and 2016 (in thousands): Year Ended March 31, 2018 2017 2016 Service cost $ 407 $ 329 $ 279 Interest cost 718 638 391 Net periodic pension cost $ 1,125 $ 967 $ 670 Weighted average assumptions used to determine net periodic pension cost at date of measurement: March 31, March 31, March 31, 2018 2017 2016 Discount rate 2.30 % 2.10 % 2.30 % Rate of compensation increase 2.25 % 2.25 % 2.25 % As of March 31, 2018 , unrecognized actuarial gains of $1.8 million ( $1.4 million , net of tax) which have not yet been recognized in net periodic pension cost are included in accumulated other comprehensive income (loss). The unrecognized actuarial gains and losses are calculated as the difference between the actuarially determined projected benefit obligation and the value of the plan assets less accrued pension costs. None of this amount is expected to be recognized in net periodic pension costs during the fiscal year ending March 31, 2019. No plan assets are expected to be returned to the Company during the fiscal year ending March 31, 2019. Expected Contributions During the fiscal year ended March 31, 2018 , the Company contributed $ 288 thousand to its defined benefit pension plan. The following sets forth benefit payments, which reflect expected future service, as appropriate, expected to be paid by the plan in the periods indicated (in thousands): 2019 $ 380 2020 $ 442 2021 $ 502 2022 $ 556 2023 $ 627 2024 - 2029 $ 4,546 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Income (loss) before income tax expense (benefit) consisted of the following (in thousands): Year Ended March 31, 2018 2017 2016 Domestic $ (35,032 ) $ 32,475 $ (6,979 ) Foreign 16,373 19,710 (25,460 ) $ (18,659 ) $ 52,185 $ (32,439 ) The components of the income tax expense (benefit) are as follows (in thousands): Year Ended March 31, 2018 2017 2016 Current income tax expense: Federal $ 14,191 $ 15,912 $ 29,238 State 1,925 3,152 2,223 Foreign 12,249 11,175 6,628 28,365 30,239 38,089 Deferred income tax expense (benefit): Federal (113,122 ) (8,278 ) (30,216 ) State (10,037 ) 3,578 (4,461 ) Foreign (3,677 ) (6,645 ) (7,482 ) (126,836 ) (11,345 ) (42,159 ) $ (98,471 ) $ 18,894 $ (4,070 ) The income tax expense (benefit) computed using the federal statutory income tax rate differs from NetScout’s effective tax rate primarily due to the following: Year Ended March 31, 2018 2017 2016 Statutory U.S. federal tax rate 31.6 % 35.0 % 35.0 % State taxes, net of federal tax effect 6.9 9.7 3.1 Research and development tax credits 39.5 (8.2 ) 13.0 Effect of foreign operations 15.5 (6.7 ) (18.2 ) Meals and entertainment (6.7 ) 2.5 (3.5 ) Domestic production activities deduction 13.8 (4.0 ) 9.2 Change in valuation allowance (0.2 ) (0.1 ) 0.7 Transaction costs — — (19.1 ) 2017 tax act 454.1 — — Foreign withholding (21.0 ) 3.8 (6.1 ) Other permanent differences (5.8 ) 4.2 (1.6 ) 527.7 % 36.2 % 12.5 % On December 22, 2017, the Tax Cuts and Jobs Act (Tax Legislation) was signed into law. The Tax Legislation significantly revises the U.S. tax code by, among other things, lowering the corporate tax rate from 35% to 21%; imposing a minimum tax on certain foreign earnings; limiting the deductibility of interest expense; implementing a territorial tax system and imposing a one-time transition tax on deemed repatriating earnings of foreign subsidiaries. In December 2017, the SEC issued Staff Accounting Bulletin No. 118 (SAB 118), which addresses situations where the accounting is incomplete for the income tax effects of the Tax Legislation. SAB 118 directs taxpayers to consider the impact of the Tax Legislation as “provisional” when the Company does not have the necessary information available, prepared or analyzed (including computations) to finalize the accounting for the change in tax law. Companies are provided a measurement period of up to one year to obtain, prepare, and analyze information necessary to finalize the accounting for provisional amounts or amounts that could not be estimated as of December 31, 2017. Due to the effective date of the rate reduction on our fiscal year, the Company recorded a blended statutory rate for the year ended March 31, 2018. While the Company continues to assess the impact of the Tax Legislation on its consolidated financial statements, the Company has recorded a provisional amount increasing current tax expense by approximately $2 million related to the transition tax associated with the deemed repatriation of foreign earnings. The Company has not provided additional income taxes for any additional outside basis differences inherent in our investments in foreign subsidiaries because the investments are essentially permanent in duration or it has been concluded that no additional tax liability will arise upon disposal. Determining the amount of unrecognized deferred tax liability related to any remaining undistributed foreign earnings not subject to the transition tax and additional outside basis difference in these entities (i.e., basis difference in excess of that subject to the one-time transition tax) is not practicable. The Company is still in the process of analyzing the impact of the Tax Legislation on its indefinite reinvestment assertion. Additionally, the Company has recorded a provisional deferred tax benefit of approximately $87 million related to the re-measurement of deferred tax assets and liabilities. In the three months ending March 31, 2018, the Company recorded an overall adjustment to our provisional income tax benefit of $4 million of additional income tax benefit principally due to changes in our estimate of the re-measurement of deferred tax assets and liabilities. The aforementioned provisional amounts may differ from actual results due to a variety of factors, including, among others, (i) management’s further assessment of the Tax Legislation and related regulatory guidance; (ii) guidance that may be issued; (iv) finalization of earnings and profits amounts and cash balances held by foreign subsidiaries impacting the transitions tax and (iv) actions the Company may take as a result of the Tax Legislation. Any adjustments to these provisional amounts made during the measurement period will be included in income from continuing operations as an adjustment to tax expense or benefit in the reporting period the amounts are determined. The Company may be subject to the tax on the Global Intangible Low-Taxed Income (GILTI) in future years but has not completed its analysis of the applicability of the tax. The Company will continue to gather and evaluate information as to the impact of this tax, and therefore will not make a policy election on how to account for GILTI (as part of deferred taxes or as a period expense) until management has received and evaluated the necessary information. Accordingly, no amounts related to GILTI are included within deferred taxes. The components of net deferred tax assets and liabilities are as follows (in thousands): Year Ended March 31, 2018 2017 Deferred tax assets: Accrued expenses $ 4,068 $ 4,883 Deferred revenue 12,168 8,427 Reserves 3,375 6,240 Pension and other retiree benefits 5,307 4,978 Net operating loss carryforwards 21,251 27,322 Tax credit carryforwards 6,625 5,502 Share-based compensation 5,164 6,418 Other 418 288 Total gross deferred tax assets 58,376 64,058 Valuation allowance (3,108 ) (3,374 ) Net deferred tax assets 55,268 60,684 Deferred tax liabilities: Intangible assets (195,959 ) (323,008 ) Depreciation (4,187 ) (8,695 ) Total deferred tax asset (liability) $ (144,878 ) $ (271,019 ) Deferred tax assets and liabilities are recognized based on the anticipated future tax consequences, attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the differences are expected to reverse. We evaluate the recoverability of deferred tax assets by considering all positive and negative evidence relating to future profitability. We weigh objective and verifiable evidence more heavily in this analysis. In situations where we conclude that we do not have sufficient objective and verifiable evidence to support the realizability of the asset we create a valuation allowance against it. A valuation allowance has been established for the deferred tax assets related to Psytechnics Ltd., and for certain deferred tax assets related to the acquisition of ONPATH. If it is later determined the Company is able to use all or a portion of the deferred tax assets for which a valuation allowance has been established, then the Company may be required to recognize these deferred tax assets through a tax benefit recorded in the period such determination is made. At March 31, 2018 , the Company had U.S. federal net operating loss carry forwards of approximately $33 million , state net operating loss carryforwards of approximately $66 million and tax credit carryforwards of approximately $8 million . The net operating loss and credit carryforwards will expire at various dates beginning in 2019. The Company also had foreign net operating loss carryforwards of approximately $67 million at March 31, 2018 . The majority of foreign net operating losses have no expiration dates. Utilization of the U.S. net operating losses and credits are subject to an annual limitation due to the ownership change limitations provided by the Internal Revenue Code of 1986, as amended, and similar state tax provisions. The Company files U.S. federal tax returns and files returns in various state, local and foreign jurisdictions. With respect to the U.S. federal and primary state jurisdictions, the Company is no longer subject to examinations by tax authorities for tax years before 2014, although carryforward attributes that were generated prior to 2014 may still be adjusted upon examination if they either have been or will be used in a future period. The Company also receives inquiries from various tax jurisdictions during the year, and some of those inquiries may include an audit of the tax return previously filed. In the normal course of business, NetScout and its subsidiaries are examined by various taxing authorities, including the IRS in the United States. A reconciliation of the beginning and ending amount of unrecognized tax benefits for the fiscal years ended March 31, 2018 , 2017 and 2016 is as follows (in thousands): Year Ended March 31, 2018 2017 2016 Balance at April 1, $ 2,926 $ 1,588 $ 1,038 Additions based on tax positions related to the current year 126 46 48 Release of tax positions of prior years (481 ) (154 ) — Increase in unrecognized tax benefits as a result of a tax position taken during a prior period — 1,446 502 Decrease relating to settlements with taxing authorities (356 ) — — Balance at March 31, $ 2,215 $ 2,926 $ 1,588 We are unable to make a reliable estimate when cash settlement, if any, will occur with a tax authority as the timing of examinations and ultimate resolution of those examinations is uncertain. All of the unrecognized tax benefits would affect the effective tax rate if recognized. The Company includes interest and penalties accrued in the consolidated financial statements as a component of the tax provision. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Acquisition related The Company has a contingent liability for $523 thousand related to the acquisition of Efflux in July 2017 for which an escrow account was established to cover damages NetScout might suffer related to any liabilities that NetScout did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the merger agreement. Generally, indemnification claims that Efflux would be liable for are limited to the total amount of the escrow account and shall be the sole source for the satisfaction of any damages to the Company for such claims, but such limitation does not apply with respect to seller's breach of certain fundamental representations or related to other specified indemnity items, for which certain of Efflux's shareholders may be liable for additional amounts in excess of the escrow amount. Except to the extent that valid indemnification claims are made prior to such time, the $523 thousand will be paid to the seller on July 12, 2018. In addition, the Company had a contingent liability for $660 thousand related to the acquisition of Avvasi in August 2016 for which an escrow account was established to cover damages NetScout suffers related to any liabilities that NetScout did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the asset purchase agreement. The $660 thousand was paid to the seller on August 21, 2017. The Company has a contingent liability related to the acquisition of Simena in November 2011 for future consideration to be paid to the former seller which had an initial fair value of $8.0 million at the time of acquisition. At March 31, 2018 and 2017, the present value of the future consideration was $4.9 million and $4.8 million , respectively. Legal From time to time, NetScout is subject to legal proceedings and claims in the ordinary course of business. In the opinion of management, the amount of ultimate expense with respect to any current legal proceedings and claims, if determined adversely, will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows. As previously disclosed, in March 2016, Packet Intelligence LLC ("Packet Intelligence" or "Plaintiff") filed a Complaint against NetScout and two subsidiary entities in the United States District Court for the Eastern District of Texas asserting infringement of five United States patents. Plaintiff’s Complaint alleged that legacy Tektronix GeoProbe products, including the G10 and GeoBlade products, infringed these patents. NetScout filed an Answer denying Plaintiff’s allegations and asserting that Plaintiff’s patents were, among other things, invalid, not infringed, and unenforceable due to inequitable conduct. In October 2017, a jury trial was held to address the parties’ claims and counterclaims regarding infringement of three patents by the G10 and GeoBlade products, invalidity of these patents, and damages. On October 13, 2017, the jury rendered a verdict finding in favor of the Plaintiff and that Plaintiff was entitled to $3,500,000 for pre-suit damages and $2,250,000 for post-suit damages. The jury indicated that the awarded damages amounts were intended to reflect a running royalty. The Court also conducted a bench trial on whether these patents were unenforceable due to, among other things, inequitable conduct. The Court has not yet rendered a decision on the equitable issues or entered final judgment in this matter. NetScout has concluded that the risk of loss from this matter is currently neither remote nor probable, and therefore, under U.S. GAAP definitions, the risk of loss is termed "reasonably possible". Therefore, accounting rules require NetScout to provide an estimate for the range of potential liability. NetScout currently estimates that the estimated range of liability is between $0 and the aggregate amount awarded by the jury, plus potential additional pre- and post-judgment interest amounts, subject to other adjustments that the Court may make. NetScout intends to continue to vigorously dispute Packet Intelligence’s claims including through appeal, if necessary. Unconditional purchase obligations At March 31, 2018 , the Company had unconditional purchase obligations of $39.9 million , which represent estimated open purchase orders to purchase inventory as well as commitments for products and services used in the normal course of business. Leases NetScout leases office space under non-cancelable operating leases. Total rent expense under the leases was $16.6 million , $13.8 million and $12.8 million for the fiscal years ended March 31, 2018 , 2017 and 2016 , respectively. At March 31, 2018 , future non-cancelable minimum lease commitments (including office space, copiers and automobiles) are as follows (in thousands): Year Ending March 31, 2019 $ 16,613 2020 13,930 2021 11,404 2022 10,538 2023 9,330 Remaining years 37,802 Total minimum lease payments $ 99,617 |
SEGMENT AND GEOGRAPHIC INFORMAT
SEGMENT AND GEOGRAPHIC INFORMATION | 12 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT AND GEOGRAPHIC INFORMATION | SEGMENT AND GEOGRAPHIC INFORMATION The Company manages its business in the following geographic areas: United States, Europe, Asia and the rest of the world. In accordance with United States export control regulations, the Company does not sell or do business with countries subject to economic sanctions and export controls. Total revenue by geography is as follows (in thousands): Year Ended March 31, 2018 2017 2016 United States $ 581,853 $ 722,440 $ 681,569 Europe 174,445 193,441 137,411 Asia 88,917 95,735 61,566 Rest of the world 141,572 150,496 74,873 $ 986,787 $ 1,162,112 $ 955,419 The United States revenue includes sales to resellers in the United States. These resellers fulfill customer orders and may subsequently ship the Company’s products to international locations. The Company reports these shipments as United States revenue because the Company ships the products to a United States location. Further, the Company determines the geography of its sales after considering where the contract originated. Beginning in the first quarter of fiscal year 2018, the Company changed the structure of its sales force. As a result, consideration was given to this change when determining revenue by geography for the fiscal year ended March 31, 2017. Prior periods in fiscal year 2017 were recast to conform to the current presentation. A majority of revenue attributable to locations outside of the United States is a result of export sales. Substantially all of the Company’s identifiable assets are located in the United States. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Mar. 31, 2018 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS During our fiscal year ended March 31, 2016 and the three months ended June 30, 2016, a member of the Company’s Board of Directors served as an executive officer of Danaher. As part of the split off of Danaher’s Communications Business and the Company’s subsequent acquisition of that business from Newco's shareholders, NetScout entered into multiple transactions with Danaher which include: transition services agreements, lease agreements, closing agreements, and compensation for post-combination services provisions within the separation and distribution agreement. This board member is now the founding President and CEO of Fortive Corporation (Fortive), which spun off of Danaher in July 2016. As part of the spin-off of Fortive, the transition services agreement was amended to, among other things, assign Danaher's rights, duties, obligations and liabilities under the transition services agreement to Fluke Corporation, a subsidiary of Fortive. The Company has disclosed the transactions with Danaher and Fortive parenthetically within the financial statements. As disclosed parenthetically within the Company's consolidated balance sheet, the Company has receivables from related parties. The following table summarizes those balances (in thousands): March 31, 2018 March 31, 2017 Danaher $ 252 $ 404 Fortive 2,935 3,181 $ 3,187 $ 3,585 As disclosed parenthetically within the Company's consolidated balance sheet, the Company has payables due to related parties. The following table summarizes those balances (in thousands): March 31, 2018 March 31, 2017 Danaher $ — $ — Fortive 369 444 $ 369 $ 444 As disclosed parenthetically within the Company's consolidated statements of operations, the Company has recorded expenses from related parties. The following table summarizes those balances (in thousands): Year Ended March 31, 2018 2017 2016 Danaher: Cost of product revenue $ — $ 4,690 $ 25,055 Cost of service revenue — 485 5,736 Research and development expenses — 1,720 16,701 Sales and marketing 2 2,273 15,430 General and administrative expenses 7 2,551 16,055 Other expense — — 379 $ 9 $ 11,719 $ 79,356 Fortive: Cost of product revenue $ 245 $ 2,539 $ — Cost of service revenue 665 260 — Research and development expenses 3 (96 ) — Sales and marketing — 150 — General and administrative expenses 1,696 1,548 — Other income (56 ) (426 ) — $ 2,553 $ 3,975 $ — As disclosed within the Company's consolidated statements of cash flows, the Company has cash flows from operating activities resulting from amounts due to related parties and due from related parties. The following table summarizes those cash flows from operating activities (in thousands): Year Ended March 31, 2018 2017 2016 Due from related party: Danaher $ 96 $ 17,310 $ (18,483 ) Fortive 347 7,745 — Total $ 443 $ 25,055 $ (18,483 ) Due to related party: Danaher $ — $ (2,954 ) $ (6,743 ) Fortive (75 ) 162 — Total $ (75 ) $ (2,792 ) $ (6,743 ) As disclosed within the Company's consolidated statements of cash flows, the Company has cash flows from investing activities resulting from amounts due from related parties. The following table summarizes those cash flows from investing activities (in thousands): Year Ended March 31, 2018 2017 2016 Due from related party: Danaher $ — $ 12,864 $ 9,306 Total $ — $ 12,864 $ 9,306 The Company recognized $45 thousand , $177 thousand , and $130 thousand in revenue from Danaher during the fiscal years ended March 31, 2018 , 2017 , and 2016 in the ordinary course of business. A member of the Company’s Board of Directors served as a member of the board of directors for EMC Corporation (EMC) during the fiscal years ended March 31, 2017 and 2016, and therefore, the Company considered sales to EMC to be a related party transaction. During the quarter ended September 30, 2016, EMC was acquired by Dell Technologies and EMC's board member resigned. The Company continued to report the wind down of preexisting transactions as related party transactions through the Company's fiscal year 2017. The Company recognized $167 thousand , and $475 thousand in revenue from EMC during the fiscal years ended March 31, 2017 and 2016 in the ordinary course of business. During the fiscal year ended March 31, 2016, the Company had a member of the Board of Directors who served as a Section 16 officer of State Street Corporation (State Street) and therefore, the Company considered sales to State Street to be a related party transaction. The Company recognized $452 thousand in revenue from State Street during the fiscal year ended March 31, 2016 in the ordinary course of business. This board member is no longer a Section 16 officer of State Street, and as a result, State Street was no longer considered a related party during the Company's fiscal year ended March 31, 2017. A member of the Company’s Board of Directors served as a trustee for Boston College during the fiscal years ended March 31, 2017 and 2016 and a portion of the fiscal year ended March 31, 2018 and therefore, the Company considers sales to Boston College to be a related party transaction. The Company recognized $150 thousand , $0 and $0 in revenue from Boston College during the fiscal years ended March 31, 2018 , 2017 and 2016, respectively, in the ordinary course of business. |
QUARTERLY RESULTS OF OPERATIONS
QUARTERLY RESULTS OF OPERATIONS - UNAUDITED | 12 Months Ended |
Mar. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY RESULTS OF OPERATIONS - UNAUDITED | QUARTERLY RESULTS OF OPERATIONS – UNAUDITED The following table sets forth certain unaudited quarterly results of operations of NetScout for the fiscal years ended March 31, 2018 and 2017 . In the opinion of management, this information has been prepared on the same basis as the audited consolidated financial statements and all necessary adjustments, consisting only of normal recurring adjustments, have been included in the amounts stated below to present fairly the quarterly information when read in conjunction with the audited consolidated financial statements and notes thereto included elsewhere in this Annual Report on Form 10-K. The quarterly operating results are not necessarily indicative of future results of operations. Three Months Ended (in thousands, except per share data) March 31, 2018 Dec. 31, Sept. 30, June 30, March 31, 2017 Dec. 31, Sept. 30, June 30, Revenue $ 235,224 $ 268,944 $ 256,863 $ 225,756 $ 318,920 $ 302,192 $ 272,048 $ 268,952 Gross profit $ 168,633 $ 204,435 $ 182,620 $ 159,194 $ 226,003 $ 220,514 $ 187,538 $ 181,918 Net income (loss) $ 16,817 $ 89,685 $ (2,468 ) $ (24,222 ) $ 22,310 $ 21,245 $ (1,266 ) $ (8,998 ) Diluted net income (loss) per share $ 0.20 $ 1.02 $ (0.03 ) $ (0.27 ) $ 0.24 $ 0.23 $ (0.01 ) $ (0.10 ) |
SCHEDULE II - VALUATION AND QUA
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Mar. 31, 2018 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts | NetScout Systems, Inc. Schedule II—Valuation and Qualifying Accounts (in thousands) Balance at Beginning of Year Additions Resulting in Charges to Operations Charges to Other Accounts Deductions Due to Write-Offs Balance at End of Year Year ended March 31, 2016 Allowance for doubtful accounts $ 173 $ 1,824 $ 3,221 $ (149 ) $ 5,069 Deferred tax asset valuation allowance $ 3,906 $ 99 $ — $ (228 ) $ 3,777 Year ended March 31, 2017 Allowance for doubtful accounts $ 5,069 $ 6,961 $ (7,580 ) $ (2,384 ) $ 2,066 Deferred tax asset valuation allowance $ 3,777 $ (338 ) $ (65 ) $ — $ 3,374 Year ended March 31, 2018 Allowance for doubtful accounts $ 2,066 $ 695 $ (346 ) $ (424 ) $ 1,991 Deferred tax asset valuation allowance $ 3,374 $ — $ — $ (266 ) $ 3,108 |
SUMMARY OF SIGNIFICANT ACCOUN31
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of NetScout and its wholly owned subsidiaries. Inter-company transactions and balances have been eliminated in consolidation. |
Fiscal Year End | Fiscal Year End During fiscal years 2018 and 2017, the fiscal year end of NetScout and its wholly owned subsidiaries ended on March 31st. During the fiscal year 2016, the fiscal year end of NetScout and its wholly owned subsidiaries ended on March 31st, except for Fluke Networks Enterprise business, which ended on April 1, 2016. During fiscal years 2018 and 2017, NetScout’s quarters ended on the last calendar day of the months of June, September and December. The fiscal year 2016 quarter end dates of the entities acquired as part of the acquisition of Danaher Corporation's (Danaher) Communications Business in July 2015 (Comms Transaction) were October 2nd and December 31st. The Company does not adjust for the difference in fiscal periods between the acquired entities and itself, as such difference would be fewer than 93 days, pursuant to Regulation S-X Rule 3A-02. References herein to Fiscal 2018, 2017 and 2016 refer to the fiscal years ended March 31, 2018, 2017, and 2016, respectively. |
Segment Reporting | Segment Reporting Our operating segments are determined based on the units that constitute a business for which financial information is available and for which operating results are regularly reviewed by the Chief Operating Decision Maker (CODM). The Company reports revenue and income in one reportable segment. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates in these financial statements include those involving revenue recognition, valuation of goodwill and acquired assets and liabilities, valuation of the pension obligation and share-based compensation. These items are continuously monitored and analyzed by management for changes in facts and circumstances and material changes in these estimates could occur in the future. |
Cash and Cash Equivalents and Marketable Securities | Cash and Cash Equivalents and Marketable Securities Under current authoritative guidance, NetScout has classified its investments as "available-for-sale" which are carried at fair value based on quoted market prices and associated unrealized gains or losses are recorded as a separate component of stockholders’ equity until realized. NetScout considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents and those investments with original maturities greater than three months to be marketable securities. At March 31, 2018 and periodically throughout the year, NetScout has maintained cash balances in various operating accounts in excess of federally insured limits. NetScout limits the amount of credit exposure by investing only with credit worthy institutions which the Company believes are those institutions with an investment grade rating for deposits. |
Revenue Recognition | Revenue Recognition The Company exercises judgment and uses estimates in connection with determining the amounts of product and services revenues to be recognized in each accounting period. The Company derives revenues primarily from the sale of network management tools and security solutions for service provider and enterprise customers, which include hardware, software and service offerings. The majority of the Company’s product sales consist of hardware products with embedded software that are essential to providing customers the intended functionality of the solutions. The Company also sells stand-alone software solutions to provide customers with enhanced functionality. In addition, the Company sells hardware bundled with a software license. Product revenue is recognized upon shipment, provided that evidence of an arrangement exists, title and risk of loss have passed to the customer, and in the case of software products, when the customer has the rights and ability to access the software, fees are fixed or determinable and collection of the related receivable is reasonably assured. If any significant obligations to the customer remain post-delivery, typically involving obligations relating to installation and acceptance by the customer, revenue recognition is deferred until such obligations have been fulfilled. Because many of the Company’s solutions are comprised of both hardware and more than incidental software components, the Company recognizes revenue in accordance with authoritative guidance on both hardware and software revenue recognition. The Company's service offerings include installation, integration, extended warranty and maintenance services, post-contract customer support (PCS), and other professional services including consulting and training. The Company generally provides software and/or hardware support as part of product sales. Revenue related to the initial bundled software and hardware support is recognized ratably over the support period. In addition, customers can elect to purchase extended support agreements for periods after the initial software/hardware warranty expiration. Support services generally include rights to unspecified upgrades (when and if available), telephone and internet-based support, updates, bug fixes and hardware repair and replacement. Consulting services are recognized upon delivery or completion of performance. Reimbursements of out-of-pocket expenditures incurred in connection with providing consulting services are included in services revenue, with the offsetting expense recorded in cost of service revenue. Training services include on-site and classroom training. Training revenues are recognized upon delivery of the training. Generally, the Company's contracts are accounted for individually. However, when contracts are closely interrelated and dependent on each other, it may be necessary to account for two or more contracts as one to reflect the substance of the group of contracts. Multi-element arrangements are concurrent customer purchases of a combination of the Company's product and service offerings that may be delivered at various points in time. For multi-element arrangements comprised only of hardware products and related services, the Company allocates the total arrangement consideration to the multiple elements based on each element’s fair value compared to the total relative selling price of all the elements. Each element’s selling price is based on management’s best estimate of selling price (BESP) paid by customers based on the element’s historical pricing when vendor-specific objective evidence (VSOE) or third-party evidence (TPE) does not exist. The Company has established BESP for product elements as the average or median selling price the element was recently sold for, whether sold alone or sold as part of a multiple element transaction. The Company also considers its overall pricing objectives and practices across different sales channels and geographies, and market conditions. The Company reviews sales of the product elements on a quarterly basis and updates when appropriate, its BESP for such elements to ensure that it reflects recent pricing experience. The Company has established VSOE for a majority of its service elements based on historical stand-alone sales or by the renewal rate offered to the customer. However, certain business units acquired as part of the Comms Transaction are unable to establish VSOE for undelivered elements. This occurs because the pricing for standalone sales does not occur in tight bands around a midpoint, and they are not contractually fixed. In these scenarios the Company has typically established BESP by creating wider bands around a midpoint for standalone transactions or in some cases using cost plus a margin for the underlying services and products. If VSOE of fair value does not exist for a deliverable, the Company has determined that BESP is the highest level of fair value that exists for those deliverables. For multi-element arrangements comprised only of software products and related services, the Company allocates a portion of the total arrangement consideration to the undelivered elements, primarily support agreements and professional services, using vendor-specific objective evidence of fair value for the undelivered elements. The remaining portion of the total arrangement consideration is allocated to the delivered software, referred to as the residual method. VSOE of fair value of the undelivered elements is based on the price customers pay when the element is sold separately. The Company reviews the separate sales of the undelivered elements on a regular basis and updates when appropriate, its VSOE of fair value for such elements to ensure that it reflects recent pricing experience. If the Company cannot objectively determine the VSOE of the fair value of any undelivered software element, revenue is deferred until all elements are delivered and services have been performed, or until fair value can objectively be determined for any remaining undelivered elements. However, if the only undelivered element is maintenance and support, the entire arrangement fee is recognized over the service period. For multi-element arrangements comprised of a combination of hardware and software elements, the total arrangement consideration is bifurcated between the hardware and hardware related deliverables and the software and software related deliverables based on the relative selling prices of all deliverables as a group. Then, arrangement consideration for the hardware and hardware-related services is recognized upon delivery or as the related services are provided outlined above and revenue for the software and software-related services is allocated following the residual method and recognized based upon delivery or as the related services are provided. The Company's products are distributed through its direct sales force and indirect distribution channels through alliances with resellers and distributors. Revenue arrangements with resellers and distributors are recognized on a sell-in basis; that is, when the Company delivers the product to the reseller or distributor. The Company records consideration given to a reseller or distributor as a reduction of revenue to the extent the Company has recorded revenue from the reseller or distributor. With limited exceptions, the Company's return policy does not allow product returns for a refund. Returns have been insignificant to date. In addition, the Company has a history of successfully collecting receivables from our resellers and distributors. |
Commission Expense | Commission Expense The Company recognizes commission expense related to the renewal of maintenance contracts at the time an order is booked. As a result, commission expense can be recognized in full even though the related revenue may not be fully recognized. Base commission expense on product revenue and corresponding new maintenance contracts is recognized in the same period as related product revenue, typically upon shipment. |
Uncollected Deferred Revenue | Uncollected Deferred Revenue Because of NetScout's revenue recognition policies, there are circumstances for which the Company does not recognize revenue relating to sales transactions that have been billed, but the related account receivable has not been collected. While the receivable represents an enforceable obligation, for balance sheet presentation purposes, the Company has not recognized the deferred revenue or the related account receivable and no amounts appear in the consolidated balance sheets for such transactions. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of investments, trade accounts receivable and accounts payable. NetScout's cash, cash equivalents, and marketable securities are placed with financial institutions with high credit standings. At March 31, 2018 and 2017 respectively, the Company had no direct customers or indirect channel partners which accounted for more than 10% of the accounts receivable balance. During the fiscal year ended March 31, 2018 no direct customers or indirect channel partners accounted for more than 10% of total revenue. During the fiscal years ended March 31, 2017 and 2016 , one direct customer, Verizon, accounted for more than 10% of total revenue, while no indirect channel partner accounted for more than 10% of total revenue. As disclosed parenthetically within the Company's consolidated balance sheet, the Company had a receivable from related parties in the amount of $3.2 million that represents a concentration of credit risk at March 31, 2018 . Historically, the Company has not experienced any significant failure of its customers to meet their payment obligations nor does the Company anticipate material non-performance by its customers in the future; accordingly, the Company does not require collateral from its customers. However, if the Company’s assumptions are incorrect, there could be an adverse impact on its allowance for doubtful accounts. |
Trade Receivable Valuations | Trade Receivable Valuations Accounts receivable are stated at their net realizable value. The allowance against gross trade receivables reflects the best estimate of probable losses inherent in the receivables portfolio determined on the basis of historical experience, specific allowances for known troubled accounts and other currently available information. |
Inventories | Inventories Inventories are stated at the lower of actual cost or net realizable value. Cost is determined by using the first-in, first-out (FIFO) method. |
Fixed Assets | Fixed Assets Fixed assets are stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term or anticipated useful life of the improvement. Gains and losses upon asset disposal are recognized in the year of disposition. Expenditures for replacements and building improvements are capitalized, while expenditures for maintenance and repairs are charged against earnings as incurred. |
Valuation of Goodwill, Intangible Assets and Other Acquisition Accounting Items | Valuation of Goodwill, Intangible Assets and Other Acquisition Accounting Items The Company amortizes acquired definite-lived intangible assets over their estimated useful lives. Goodwill and other indefinite-lived intangible assets are not amortized but subject to annual impairment tests; more frequently if events or circumstances occur that would indicate a potential decline in their fair value. The Company performs the assessment annually during the fourth quarter and on an interim basis if potential impairment indicators arise. The Company has identified two reporting units: (1) Service Assurance and (2) Security. To test impairment, the Company first assesses qualitative factors to determine whether the existence of events and circumstances indicate that it is more likely than not that the intangible asset is impaired. If based on the Company's qualitative assessment it is more likely than not that the fair value of the intangible asset is less than its carrying amount, quantitative impairment testing is required. However, if the Company concludes otherwise, quantitative impairment testing is not required. During fiscal year 2018, the Company performed a quantitative analysis for goodwill and its non-amortizing intangible asset. The Company determined the fair value of the reporting unit's goodwill using established income and market valuation approaches and the fair value of its trade names using a forward-looking relief from royalty model. All goodwill and indefinite-lived intangible assets were estimated to be recoverable as of January 31, 2018. The Company completed three acquisitions during the three-year period ended March 31, 2018 . The acquisition method of accounting requires an estimate of the fair value of the assets and liabilities acquired as part of these transactions. In order to estimate the fair value of acquired intangible assets, the Company uses a relief from royalty model which requires management to estimate: future revenues expected to be generated by the acquired intangible assets, a royalty rate which a market participant would pay related to the projected revenue stream, a present value factor which approximates a risk adjusted rate of return for a market participant purchasing the assets, and a technology migration curve representing a period of time over which the technology assets or some portion thereof are still being used. The Company is also required to develop the fair value for customer relationships acquired as part of these transactions which requires that we create estimates for the following items: a projection of future revenues associated with the acquired company’s existing customers, a turnover rate for those customers, a margin related to those sales, and a risk adjusted rate of return for a market participant purchasing those relationships. The Company has a contingent liability for $523 thousand related to the acquisition of Efflux in July 2017 for which an escrow account was established to cover damages NetScout suffers related to any liabilities that NetScout did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the merger agreement. Generally, indemnification claims that Efflux would be liable for are limited to the total amount of the escrow account and shall be the sole source for the satisfaction of any damages to the Company for such claims, but such limitation does not apply with respect to seller's breach of certain fundamental representations or related to other specified indemnity items, for which certain of Efflux's shareholders may be liable for additional amounts in excess of the escrow amount. Except to the extent that valid indemnification claims are made prior to such time, the $523 thousand will be paid to the seller on July 12, 2018. The Company's contingent purchase consideration at March 31, 2017 included $660 thousand related to the acquisition of Avvasi Incorporated (Avvasi) in August 2016 for which an escrow account was established to cover damages NetScout suffers related to any liabilities that NetScout did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the asset purchase agreement. The $660 thousand was paid to the seller on August 21, 2017. The Comms Transaction during fiscal year ended March 31, 2016 contained both contingently returnable consideration and contingent purchase consideration. The contingently returnable consideration represented a contingent right of return from Danaher to reimburse NetScout for certain cash awards paid by NetScout to employees of the Communications Business transferred to Newco for post-combination services on various dates through August 4, 2016. During the fiscal year ended March 31, 2017, certain post-combination cash retention payments had been disbursed. Danaher reimbursed the Company for those costs and NetScout reimbursed Danaher for the tax benefit. The acquisition of Simena LLC on November 18, 2011 also contained contingent consideration based on the ultimate settlement of assets and liabilities acquired as part of the transaction, and the former owners' future period of employment with the Company. Contingent consideration accounting requires the Company to estimate the probability of various settlement scenarios, the former owners' expected period of employment with NetScout, and a risk adjusted interest rate to present value the payment streams. |
Capitalized Software Development Costs | Capitalized Software Development Costs Costs incurred in the research and development of the Company’s products are expensed as incurred, except for certain software development costs. Costs associated with the development of computer software are expensed prior to the establishment of technological feasibility and capitalized thereafter until the related software products are available for first customer shipment. Such costs are amortized using the straight-line method over the estimated economic life of the product, which generally does not exceed three years . Capitalized software development costs are periodically assessed for recoverability in the event of changes to the anticipated future revenue for the software products or changes in product technologies. Unamortized capitalized software development costs that are determined to be in excess of the net realizable value of the software products would be expensed in the period in which such a determination is made. Typically for accounting purposes, these R&D investments have not been capitalized because of the development methodology employed. The developments are added individually to the core code over a shorter period of time but marketed as a release once all portions are complete. |
Derivative Financial Instruments | Derivative Financial Instruments Under authoritative guidance for derivative instruments and hedging activities, all hedging activities must be documented at the inception of the hedge and must meet the definition of highly effective in offsetting changes to future cash flows in order for the derivative to qualify for hedge accounting. Under the guidance, if an instrument qualifies for hedge accounting, the changes in the fair value each period for open contracts, measured at the end of the period, are recorded to other comprehensive income. Otherwise, changes in the fair value are recorded in earnings each period. Management must perform initial and ongoing tests in order to qualify for hedge accounting. In accordance with the guidance, the Company accounts for its instruments under hedge accounting. The effectiveness and a measurement of ineffectiveness of qualifying hedge contracts are assessed by the Company quarterly. The Company records the fair value of its derivatives in prepaid expenses and other current assets and accrued other in the Company's consolidated balance sheet. The effective portion of gains or losses resulting from changes in the fair value of qualifying hedges are recorded in other comprehensive income (loss) until the forecasted transaction occurs, with any ineffective portion classified directly to the Company’s consolidated statement of operations based on the expense categories of the items being hedged. When forecasted transactions occur, unrealized gains or losses associated with the effective portion of the hedge are reclassified to the respective expense categories in the Company’s consolidated statement of operations. Gains or losses related to hedging activity are included as operating activities in the Company’s consolidated statement of cash flows. If the underlying forecasted transactions do not occur, or it becomes probable that they will not occur, the gain or loss on the related cash flow hedge is recognized immediately in earnings. |
Contingencies | Contingencies NetScout accounts for claims and contingencies in accordance with authoritative guidance that requires an estimated loss to be recorded from a claim or loss contingency when information available prior to issuance of our consolidated financial statements indicates that it is probable that a liability has been incurred at the date of the consolidated financial statements and the amount of the loss can be reasonably estimated. If NetScout determines that it is reasonably possible but not probable that an asset has been impaired or a liability has been incurred or if the amount of a probable loss cannot be reasonably estimated, then in accordance with the authoritative guidance, we disclose the amount or range of estimated loss if the amount or range of estimated loss is material. Accounting for claims and contingencies requires NetScout to use its judgment. NetScout consults with legal counsel on those issues related to litigation and seeks input from other experts and advisors with respect to matters in the ordinary course of business. Contingent liabilities include contingent consideration in connection with the Company’s acquisitions. Contingent consideration represents earnout payments in connection with the Company’s acquisitions and is recognized at fair value on the acquisition date and remeasured each reporting period with subsequent adjustments recognized in the consolidated statements of income. The Company discounts the contingent purchase consideration to present value using a risk adjusted interest rate at each reporting period. Contingent consideration is valued using significant inputs that are not observable in the market which are defined as Level 3 inputs pursuant to fair value measurement accounting. The Company believes its estimates and assumptions are reasonable, however, there is significant judgment involved. Changes in the fair value of contingent liabilities may result from changes in discount periods. The Company reflects changes in fair value due to probability changes in earnings in the consolidated statements of income. Earnout payments are reflected in cash flows from financing activities and the changes in fair value are reflected in cash flows from operating activities in the consolidated statements of cash flows. |
Share-based Compensation | Share-Based Compensation NetScout recognizes compensation expense for all share-based payments granted. Under the fair value recognition provisions, share-based compensation is calculated net of an estimated forfeiture rate and compensation cost is only recognized for those shares expected to vest on a straight-line basis over the expected requisite service period of the award. |
Foreign Currency | Foreign Currency NetScout accounts for its reporting of foreign operations in accordance with guidance which establishes guidelines for the determination of the functional currency of foreign subsidiaries. In accordance with the guidance, NetScout has determined its functional currency for those foreign subsidiaries that are an extension of NetScout's U.S. operations to be the U.S. Dollar. Assets and liabilities of subsidiaries operating outside the United States with a functional currency other than U.S. dollars are translated into United States dollars using the period-end exchange rate, and income and expense items are translated using the average exchange rate during the period. Cumulative translation adjustments are reflected as a separate component of stockholders’ equity. NetScout will experience currency exchange risk with respect to foreign currency denominated expenses. In order to partially offset the risks associated with the effects of certain foreign currency exposures, NetScout has established a program that utilizes foreign currency forward contracts. Under this program, increases or decreases in foreign currency exposures are partially offset by gains or losses on forward contracts, to mitigate the impact of foreign currency transaction gains or losses. The Company does not use forward contracts to engage in currency speculation. All outstanding foreign currency forward contracts are recorded at fair value at the end of each fiscal period. |
Advertising Expense | Advertising Expense NetScout recognizes advertising expense as incurred. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) is comprised of net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) typically consists of unrealized gains and losses on marketable securities, unrealized gain (loss) on hedge contracts, actuarial gains and losses, and foreign currency translation adjustments. |
Income Taxes | Income Taxes NetScout accounts for its income taxes under the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax basis, as well as the effect of any net operating loss and tax credit carryforwards. Income tax expense is comprised of the current tax liability or benefit and the change in deferred tax assets and liabilities. We evaluate the recoverability of deferred tax assets by considering all positive and negative evidence relating to future profitability. We weigh objective and verifiable evidence more heavily in this analysis. In situations where we conclude that we do not have sufficient objective and verifiable evidence to support the realizability of the deferred tax asset, we create a valuation allowance against it. |
Recent Accounting Standards | Recent Accounting Standards In March 2018, the Financial Account Standards Board (FASB) issued Accounting Standards Update (ASU) 2018-05 associated with the accounting and disclosures around the enactment of the Act and the Securities and Exchange Commission’s Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which the Company has adopted. In February 2018, the FASB issued ASU 2018-02, Reclassification of Certain Tax Effects From Accumulated Other Comprehensive Income. ASU 2018-02 amends ASC 220, Income Statement - Reporting Comprehensive Income, to allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Act. In addition, under the ASU 2018-02, the Company may be required to provide certain disclosures regarding stranded tax effects. ASU 2018-02 is effective for years beginning after December 15, 2018, and interim periods within those fiscal years. ASU 2018-02 is effective for the Company beginning April 1, 2019. Early adoption is permitted. The Company does not believe the adoption of ASU 2018-02 will have a material impact on its consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities (ASU 2017-12). ASU 2017-12 intends to better align an entity's risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The amendments expand and refine hedge accounting for both non-financial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. This standard is effective for financial statements issued for fiscal years beginning after December 15, 2018, with early adoption permitted. ASU 2017-12 is effective for the Company beginning April 1, 2019. The Company is currently assessing the potential impact of the adoption of ASU 2017-12 on its consolidated financial statements. In March 2017, the FASB issued ASU 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-Retirement Benefit Cost (ASU 2017-07) which requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. This standard is effective for financial statements issued for fiscal years beginning after December 15, 2017 and should be applied retrospectively to all periods presented. ASU 2017-07 is effective for the Company beginning April 1, 2018. The Company does not believe the adoption of ASU 2017-07 will have a material impact on its consolidated financial statements. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805), Clarifying the Definition of a Business (ASU 2017-01). ASU 2017-01 clarifies the definition of a business with the objective of addressing whether transactions involving in-substance nonfinancial assets, held directly or in a subsidiary, should be accounted for as acquisitions or disposals of nonfinancial assets or of businesses. ASU 2017-01 is effective for annual periods beginning after December 15, 2017. ASU 2017-01 is effective for the Company beginning April 1, 2018. Early adoption is permitted for transactions, including acquisitions or dispositions, which occurred before the issuance date or effective date of the standard if the transactions were not reported in financial statements that have been issued or made available for issuance. The Company does not believe the adoption of ASU 2017-01 will have a material impact on its consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (ASU 2016-18) related to the presentation of restricted cash in the statement of cash flows. The pronouncement requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. When cash, cash equivalents, restricted cash and restricted cash equivalents are presented in more than one line item on the balance sheet, the new guidance requires a reconciliation of the totals in the statement of cash flows to the related captions in the balance sheet. Entities will also have to disclose the nature of restricted cash and restricted cash equivalent balances. The pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2017, with early adoption permitted. The Company adopted this guidance retrospectively on April 1, 2017. The Company does not have a material amount of restricted cash. Adoption of this ASU did not have a material impact on the Company's consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory (ASU 2016-16). ASU 2016-16 requires that entities recognize the income tax effects of intra-entity transfers of assets other than inventory when the transfer occurs. Current GAAP prohibits the recognition of those tax effects until the asset has been sold to an outside party. The pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2017, with early adoption permitted. ASU 2016-16 is effective for the Company beginning April 1, 2018. The Company is evaluating the new guidance and does not believe the adoption of ASU 2016-16 will have a material impact on its consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15). ASU 2016-15 is intended to add or clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows and to eliminate the diversity in practice related to such classifications. The guidance in ASU 2016-15 is required for annual reporting periods beginning after December 15, 2017, with early adoption permitted. ASU 2016-15 is effective for the Company beginning April 1, 2018. The Company is currently assessing the potential impact of the adoption of ASU 2016-15 on its consolidated statement of cash flows. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting (ASU 2016-09), which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures and statutory tax withholding requirements, as well as classification in the statement of cash flows. The Company adopted this guidance on April 1, 2017, which had the following impact on the consolidated financial statements: • On a prospective basis, as required, the Company recorded an excess tax benefit of $0.7 million to the provision for income taxes in the consolidated statement of operations for the fiscal year ended March 31, 2018 instead of additional paid-in capital in the consolidated balance sheet. As a result, net income increased $0.7 million and basic and diluted earnings per share increased $0.01 for the fiscal year ended March 31, 2018. • Excess tax benefits are presented as operating cash activity instead of financing cash activity in the consolidated statements of cash flows, which the Company elected to apply on a retrospective basis. As a result, the Company classified $0.7 million of excess tax benefits, a $1.0 million tax shortfall, and a $1.9 million excess tax benefit for the fiscal years ended March 31, 2018, 2017 and 2016, respectively, as operating cash inflows for the fiscal years ended March 31, 2018 and March 31, 2016, and as an operating cash outflow for the fiscal year ended March 31, 2017 included within the change in income taxes payable in the consolidated statements of cash flows. The retrospective classification resulted in a $0.7 million and a $1.9 million increase in cash provided by operating activities and cash used in financing activities for the fiscal years ended March 31, 2018 and 2016, respectively, and a decrease in cash provided by operating activities and cash provided by financing activities of $1.0 million for the fiscal year ended March 31, 2017. • The Company prospectively excluded the excess tax benefits from the assumed proceeds available to repurchase shares in the computation of diluted earnings per share under the treasury stock method, which did not have a material impact on diluted earnings per share for the fiscal year ended March 31, 2018. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) Section A - Leases: Amendments to the FASB Accounting Standards Codification (ASU 2016-02), its new standard on accounting for leases. This update requires the recognition of leased assets and lease obligations by lessees for those leases currently classified as operating leases under existing lease guidance. Short term leases with a term of 12 months or less are not required to be recognized. The update also requires disclosure of key information about leasing arrangements to increase transparency and comparability among organizations. ASU 2016-02 is effective for annual reporting periods beginning after December 31, 2018 and interim periods within those fiscal years, and early adoption is permitted. The Company is currently assessing the potential impact of the adoption of ASU 2016-02 on its consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers: Topic 606 (ASU 2014-09) and issued subsequent amendments to the initial guidance in August 2015, March 2016, April 2016, May 2016, December 2016 and September 2017, within ASU 2015-04, 2016-08, ASU 2016-10, ASU 2016-12, ASU 2016-20, ASU 2017-13 and ASU 2017-14, respectively (collectively, Topic 606). Topic 606 supersedes nearly all existing revenue recognition guidance under GAAP. The core principle of Topic 606 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. Topic 606 defines a five-step process to achieve this core principle and, in applying this process, it is possible that more judgments and estimates may be required within the revenue recognition process than are required under existing 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 each separate performance obligation, among others. Entities have the option of using either a full retrospective or a modified retrospective approach to adopt this standard. The Company is electing to use the modified retrospective transition approach. Topic 606 became effective for the Company on April 1, 2018. In preparation for adoption of the standard, the Company has implemented internal controls and key system functionality to enable the preparation of financial information and have reached conclusions on key accounting assessments related to the standard. As of April 1, 2018, the Company expects to release approximately $34.9 million of deferred revenue. In addition, prior to the adoption of Topic 606, the Company expensed commissions as they were earned by the sales force, while under ASC 606 the requirement is to match the timing of the commissions expense with the timing of the revenue for each arrangement’s underlying performance obligations. The Company has elected to employ a practical expedient wherein commissions are expensed immediately for revenues recognized within one year, however commissions associated with arrangements where revenues are recognized over longer time frames (primarily multi-year PCS arrangements and maintenance renewals) will be capitalized and amortized. The expected impact of the second change created $7.2 million of capitalized commissions costs as of April 1, 2018. A majority of those costs will be fully amortized by the end of the fiscal year ending March 31, 2019. |
CASH, CASH EQUIVALENTS AND MA32
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows (in thousands): March 31, 2018 March 31, 2017 March 31, 2016 March 31, 2015 Cash and cash equivalents $ 369,821 $ 304,880 $ 210,711 $ 104,893 Restricted cash 910 846 186 186 Total cash, cash equivalents and restricted cash $ 370,731 $ 305,726 $ 210,897 $ 105,079 |
Schedule of Restricted Cash | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows (in thousands): March 31, 2018 March 31, 2017 March 31, 2016 March 31, 2015 Cash and cash equivalents $ 369,821 $ 304,880 $ 210,711 $ 104,893 Restricted cash 910 846 186 186 Total cash, cash equivalents and restricted cash $ 370,731 $ 305,726 $ 210,897 $ 105,079 |
Summary of Marketable Securities Classified as Short-term and Long-term | The following is a summary of marketable securities held by NetScout at March 31, 2018 classified as short-term and long-term (in thousands): Amortized Cost Unrealized Losses Fair Value Type of security: U.S. government and municipal obligations $ 42,246 $ (60 ) $ 42,186 Commercial paper 33,003 — 33,003 Corporate bonds 2,754 (2 ) 2,752 Total short-term marketable securities 78,003 (62 ) 77,941 Total long-term marketable securities — — — Total marketable securities $ 78,003 $ (62 ) $ 77,941 The following is a summary of marketable securities held by NetScout at March 31, 2017 , classified as short-term and long-term (in thousands): Amortized Cost Unrealized Losses Fair Value Type of security: U.S. government and municipal obligations $ 98,989 $ (21 ) $ 98,968 Commercial paper 29,469 — 29,469 Corporate bonds 7,959 (3 ) 7,956 Certificates of deposit 1,499 — 1,499 Total short-term marketable securities 137,916 (24 ) 137,892 U.S. government and municipal obligations 21,952 (19 ) 21,933 Total long-term marketable securities 21,952 (19 ) 21,933 Total marketable securities $ 159,868 $ (43 ) $ 159,825 |
Summary of Contractual Maturities of Marketable Securities | Contractual maturities of the Company’s marketable securities held at March 31, 2018 and March 31, 2017 were as follows (in thousands): March 31, March 31, Available-for-sale securities: Due in 1 year or less $ 77,941 $ 137,892 Due after 1 year through 5 years — 21,933 $ 77,941 $ 159,825 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities | The following tables present the Company’s financial assets and liabilities measured on a recurring basis using the fair value hierarchy at March 31, 2018 and 2017 (in thousands): Fair Value Measurements at March 31, 2018 Level 1 Level 2 Level 3 Total ASSETS: Cash and cash equivalents $ 369,821 $ — $ — $ 369,821 U.S. government and municipal obligations 14,513 27,673 — 42,186 Commercial paper — 33,003 — 33,003 Corporate bonds 2,752 — — 2,752 Derivative financial instruments — 122 — 122 $ 387,086 $ 60,798 $ — $ 447,884 LIABILITIES: Contingent purchase consideration $ — $ — $ (5,464 ) $ (5,464 ) Derivative financial instruments — (40 ) — (40 ) $ — $ (40 ) $ (5,464 ) $ (5,504 ) Fair Value Measurements at March 31, 2017 Level 1 Level 2 Level 3 Total ASSETS: Cash and cash equivalents $ 304,880 $ — $ — $ 304,880 U.S. government and municipal obligations 40,628 80,273 — 120,901 Commercial paper — 29,469 — 29,469 Corporate bonds 7,956 — — 7,956 Certificate of deposits — 1,499 — 1,499 Derivative financial instruments — 110 — 110 $ 353,464 $ 111,351 $ — $ 464,815 LIABILITIES: Contingent purchase consideration $ — $ — $ (5,449 ) $ (5,449 ) Derivative financial instruments — (213 ) — (213 ) $ — $ (213 ) $ (5,449 ) $ (5,662 ) |
Schedule of Reconciliation of Changes in Fair Value of Level Three Financial Liabilities | The following table sets forth a reconciliation of changes in the fair value of the Company’s Level 3 financial liabilities for the year ended March 31, 2018 (in thousands): Contingent Purchase Consideration Balance at March 31, 2017 $ (5,449 ) Additions to Level 3 (523 ) Increase in fair value and accretion expense (included within research and development expense) (152 ) Payments made 660 Balance at March 31, 2018 $ (5,464 ) The following table sets forth a reconciliation of changes in the fair value of the Company’s Level 3 financial liabilities for the year ended March 31, 2017 (in thousands): Contingent Purchase Consideration Contingently Returnable Consideration Balance at March 31, 2016 $ (7,293 ) $ 16,131 Additions to Level 3 (660 ) — Increase in fair value and accretion expense (included within research and development expense) (153 ) — Decrease in fair value — (610 ) Gross presentation of contingently returnable consideration to contingent purchase consideration (3,910 ) 3,910 Payments received — (19,431 ) Payments made 6,567 — Balance at March 31, 2017 $ (5,449 ) $ — |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories are stated at the lower of actual cost or net realizable value. Cost is determined by using the FIFO method. Inventories consist of the following (in thousands): March 31, 2018 2017 Raw materials $ 20,860 $ 22,305 Work in process 2,589 998 Finished goods and deferred costs 11,325 16,699 $ 34,774 $ 40,002 |
FIXED ASSETS (Tables)
FIXED ASSETS (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Fixed Assets | Fixed assets consist of the following (in thousands): Estimated Useful Life in Years March 31, 2018 2017 Furniture and fixtures 3-7 $ 6,596 $ 6,436 Computer equipment and internal use software 3-5 147,237 135,100 Demonstration and spare part units 2-5 31,338 28,036 Leasehold improvements (1) up to 12 19,340 16,623 204,511 186,195 Less – accumulated depreciation (152,000 ) (124,802 ) $ 52,511 $ 61,393 (1) Leasehold improvements are depreciated over the shorter of the lease term or anticipated useful life of the improvement. |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
Summary of Purchase Price Allocation | The following table summarizes the allocation of the purchase price (in thousands): Initial cash payment $ 8,104 Estimated fair value of contingent purchase consideration 523 Estimated purchase price $ 8,627 Estimated fair value of assets acquired and liabilities assumed (in thousands): Cash $ 93 Accounts receivable 3 Prepaid and other current assets 208 Property, plant and equipment 8 Intangible assets 2,590 Deferred tax asset 841 Accounts payable (7 ) Accrued other liabilities (200 ) Deferred revenue (8 ) Deferred tax liabilities (978 ) Goodwill $ 6,077 |
Schedule of Fair value of Acquired Identifiable Intangible Assets and Related Estimates of Useful Lives | The following table reflects the fair value of the acquired identifiable intangible assets and related estimates of useful lives (in thousands): Fair Value Useful Life (Years) Developed technology $ 1,980 10 Customer relationships 610 10 $ 2,590 The weighted average useful life of identifiable intangible assets acquired from Efflux is 10 years. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill for the fiscal years ended March 31, 2018 and 2017 are as follows (in thousands): Balance at March 31, 2016 $ 1,709,369 Goodwill attributable to the Avvasi acquisition 1,950 Purchase accounting adjustments 3,792 Foreign currency translation impact and other adjustments 3,051 Balance at March 31, 2017 $ 1,718,162 Goodwill attributable to the Efflux acquisition 6,077 Foreign currency translation impact (11,475 ) Balance as of March 31, 2018 $ 1,712,764 |
Schedule of Intangible Assets | Intangible assets include the indefinite lived trade name with a carrying value of $18.6 million and the following amortizable intangible assets at March 31, 2018 (in thousands): Cost Accumulated Amortization Net Developed technology $ 259,758 $ (148,937 ) $ 110,821 Customer relationships 845,490 (176,425 ) 669,065 Distributor relationships and technology licenses 9,019 (5,389 ) 3,630 Definite-lived trademark and trade name 44,387 (18,138 ) 26,249 Core technology 7,345 (6,712 ) 633 Net beneficial leases 336 (336 ) — Non-compete agreements 317 (317 ) — Leasehold interest 2,600 (2,130 ) 470 Backlog 18,544 (18,544 ) — Capitalized software 3,183 (1,621 ) 1,562 Other 1,247 (903 ) 344 $ 1,192,226 $ (379,452 ) $ 812,774 Intangible assets include the indefinite lived trade name with a carrying value of $18.6 million and the following amortizable intangible assets at March 31, 2017 (in thousands): Cost Accumulated Amortization Net Developed technology $ 254,005 $ (110,200 ) $ 143,805 Customer relationships 831,731 (105,319 ) 726,412 Distributor relationships and technology licenses 8,290 (3,068 ) 5,222 Definite-lived trademark and trade name 43,817 (12,078 ) 31,739 Core technology 7,108 (6,009 ) 1,099 Net beneficial leases 336 (336 ) — Non-compete agreements 278 (278 ) — Leasehold interest 2,600 (998 ) 1,602 Backlog 18,142 (18,133 ) 9 Capitalized software 3,047 (594 ) 2,453 Other 1,208 (880 ) 328 $ 1,170,562 $ (257,893 ) $ 912,669 |
Summary of Amortization Expense | The following table provides a summary of amortization expense during the fiscal years ended March 31, 2018 , 2017 , and 2016 (in thousands). Years Ended March 31, 2018 2017 2016 Amortization of intangible assets included as: Product revenue $ 9 $ 11,438 $ 6,747 Cost of product revenue 40,286 44,326 45,127 Operating expense 76,661 70,325 32,547 $ 116,956 $ 126,089 $ 84,421 |
Schedule of Expected Future Amortization Expense | The following is the expected future amortization expense at March 31, 2018 for the fiscal years ended March 31 (in thousands): 2019 $ 130,108 2020 116,494 2021 80,232 2022 69,778 2023 62,045 Thereafter 354,117 Total $ 812,774 |
DERIVATIVE INSTRUMENTS AND HE38
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Summary of Notional Amounts and Fair Values of Derivative Instruments on Consolidated Balance Sheet | The notional amounts and fair values of derivative instruments in the consolidated balance sheets at March 31, 2018 and 2017 were as follows (in thousands): Notional Amounts (a) Prepaid Expenses and Other Current Assets Accrued Other March 31, 2018 March 31, 2017 March 31, 2018 March 31, 2017 March 31, 2018 March 31, 2017 Derivatives Designated as Hedging Instruments: Forward contracts $ 11,225 $ 14,752 $ 122 $ 110 $ 40 $ 213 (a) Notional amounts represent the gross contract/notional amount of the derivatives outstanding. |
Summary of Effect of Foreign Exchange Forward Contracts on OCI and Results of Operations | The following table provides the effect foreign exchange forward contracts had on other comprehensive income (loss), (OCI) and results of operations at March 31, 2018 and 2017 (in thousands): Derivatives in Cash Flow Hedging Relationships Effective Portion Ineffective Portion Gain (Loss) Recognized in OCI on Derivative (a) Gain (Loss) Reclassified from Accumulated OCI into Income (b) Gain (Loss) Recognized in Income (Amount Excluded from Effectiveness Testing) (c) March 31, March 31, March 31, March 31, March 31, March 31, 2018 2017 Location 2018 2017 Location 2018 2017 Forward contracts $ 1,079 $ (444 ) Research and development $ (121 ) $ (3 ) Research and development $ 60 $ 74 Sales and marketing (779 ) 361 Sales and marketing (153 ) (183 ) $ 1,079 $ (444 ) $ (900 ) $ 358 $ (93 ) $ (109 ) (a) The amount represents the change in fair value of derivative contracts due to changes in spot rates. (b) The amount represents reclassification from other comprehensive income to earnings that occurs when the hedged item affects earnings. (c) The amount represents the change in fair value of derivative contracts due to changes in the difference between the spot price and forward price that is excluded from the assessment of hedge effectiveness and therefore recognized in earnings. No gains or losses were reclassified as a result of discontinuance of cash flow hedges. |
RESTRUCTURING CHARGES (Tables)
RESTRUCTURING CHARGES (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Activities | The following table provides a summary of the activity related to the restructuring plans and the related restructuring liability (in thousands): Q3 FY2016 Plan Q1 FY2017 Plan Q4 FY2017 Plan Q3 FY2018 Plan Employee-Related Employee-Related Employee-Related Facilities Related Employee-Related Total Balance at March 31, 2016 $ 272 $ — $ — $ — $ — $ 272 Restructuring charges to operations — 2,034 1,867 405 — 4,306 Cash payments (272 ) (1,739 ) (317 ) — — (2,328 ) Other adjustments — (295 ) — — — (295 ) Balance at March 31, 2017 $ — $ — $ 1,550 $ 405 $ — $ 1,955 Restructuring charges to operations — — 729 208 5,085 6,022 Cash payments — — (1,867 ) (374 ) (1,331 ) (3,572 ) Other adjustments — — (412 ) (239 ) (58 ) (709 ) Balance at March 31, 2018 $ — $ — $ — $ — $ 3,696 $ 3,696 |
NET INCOME (LOSS) PER SHARE (Ta
NET INCOME (LOSS) PER SHARE (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Calculations of Basic and Diluted Net Income per Share and Potential Common Shares | Calculations of the basic and diluted net income (loss) per share and potential common shares are as follows (in thousands, except for per share data): Year Ended March 31, 2018 2017 2016 Numerator: Net income (loss) $ 79,812 $ 33,291 $ (28,369 ) Denominator: Denominator for basic net income (loss) per share - weighted average common shares outstanding 87,425 92,226 81,927 Dilutive common equivalent shares: Weighted average restricted stock units 836 694 — Denominator for diluted net income (loss) per share - weighted average shares outstanding 88,261 92,920 81,927 Net income (loss) per share: Basic net income (loss) per share $ 0.91 $ 0.36 $ (0.35 ) Diluted net income (loss) per share $ 0.90 $ 0.36 $ (0.35 ) |
Summary of Antidilutive Securities Excluded from Computation of Diluted EPS | The following table sets forth options and restricted stock units excluded from the calculation of diluted net income per share, since their inclusion would be antidilutive (in thousands): Year Ended March 31, 2018 2017 2016 Restricted stock units 1,450 1,320 453 |
STOCK PLANS (Tables)
STOCK PLANS (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Share-Based Compensation Expense | The following is a summary of share-based compensation expense including restricted stock units and employee stock purchases made under our employee stock purchase plan (ESPP) based on estimated fair values within the applicable cost and expense lines identified below (in thousands): Year Ended March 31, 2018 2017 2016 Cost of product revenue $ 1,159 $ 934 $ 645 Cost of service revenue 4,824 3,956 2,601 Research and development 14,711 12,362 9,205 Sales and marketing 15,213 12,823 8,725 General and administrative 11,410 9,114 7,175 $ 47,317 $ 39,189 $ 28,351 |
Summary of Transactions under Amended 2007 Equity Incentive Plan | Transactions under the Amended 2007 Plan during the fiscal years ended March 31, 2018 , 2017 and 2016 are summarized in the table below. Restricted Stock Units Number of Awards Weighted Average Fair Value Outstanding – March 31, 2015 1,929,315 $ 30.18 Granted 1,806,490 37.20 Vested (736,170 ) 26.52 Canceled (126,329 ) 34.99 Outstanding – March 31, 2016 2,873,306 $ 35.32 Granted 2,020,536 24.92 Vested (950,159 ) 33.16 Canceled (333,382 ) 33.40 Outstanding – March 31, 2017 3,610,301 $ 30.24 Granted 1,962,590 34.01 Vested (1,216,585 ) 31.09 Canceled (277,526 ) 31.70 Outstanding – March 31, 2018 4,078,780 $ 31.77 |
Schedule of Aggregate Intrinsic Values of Stock Options and Restricted Stock Units | The aggregate intrinsic value of stock options exercised and the fair value of restricted stock units vested at March 31, 2018 , 2017 and 2016 were as follows (in thousands): Year Ended March 31, 2018 2017 2016 Total fair value of restricted stock unit awards vested $ 40,539 $ 28,293 $ 25,936 |
PENSION BENEFIT PLANS (Tables)
PENSION BENEFIT PLANS (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Retirement Benefits [Abstract] | |
Schedule of Changes in Benefit Obligation | The components of the change in benefit obligation of the pension plan is as follows (in thousands): March 31, March 31, 2018 2017 Benefit obligation, at beginning of year $ 30,141 $ 29,188 Service cost 407 329 Interest cost 718 638 Benefits paid and other (288 ) (231 ) Actuarial loss (gain) (1,788 ) 1,226 Foreign exchange rate impact 4,274 (1,009 ) Benefit obligation, at end of year $ 33,464 $ 30,141 |
Schedule of Changes in Fair Value of Plan Assets | The reconciliation of the beginning and ending balances of the fair value of the assets of the pension plan is as follows (in thousands): March 31, March 31, 2018 2017 Fair value of plan assets, at beginning of year $ — $ — Employer direct benefit payments 288 231 Benefits paid and other (288 ) (231 ) Fair value of plan assets, at end of year $ — $ — |
Schedule of Net Benefit Costs | The following sets forth the components of the Company's net periodic pension cost of the noncontributory defined benefit pension plans for the fiscal years ended March 31, 2018 , 2017 , and 2016 (in thousands): Year Ended March 31, 2018 2017 2016 Service cost $ 407 $ 329 $ 279 Interest cost 718 638 391 Net periodic pension cost $ 1,125 $ 967 $ 670 |
Schedule of Assumptions Used | Weighted average assumptions used to determine net periodic pension cost at date of measurement: March 31, March 31, March 31, 2018 2017 2016 Discount rate 2.30 % 2.10 % 2.30 % Rate of compensation increase 2.25 % 2.25 % 2.25 % |
Schedule of Expected Benefit Payments | The following sets forth benefit payments, which reflect expected future service, as appropriate, expected to be paid by the plan in the periods indicated (in thousands): 2019 $ 380 2020 $ 442 2021 $ 502 2022 $ 556 2023 $ 627 2024 - 2029 $ 4,546 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax Expense | Income (loss) before income tax expense (benefit) consisted of the following (in thousands): Year Ended March 31, 2018 2017 2016 Domestic $ (35,032 ) $ 32,475 $ (6,979 ) Foreign 16,373 19,710 (25,460 ) $ (18,659 ) $ 52,185 $ (32,439 ) |
Summary of Components of Income Tax Expense | The components of the income tax expense (benefit) are as follows (in thousands): Year Ended March 31, 2018 2017 2016 Current income tax expense: Federal $ 14,191 $ 15,912 $ 29,238 State 1,925 3,152 2,223 Foreign 12,249 11,175 6,628 28,365 30,239 38,089 Deferred income tax expense (benefit): Federal (113,122 ) (8,278 ) (30,216 ) State (10,037 ) 3,578 (4,461 ) Foreign (3,677 ) (6,645 ) (7,482 ) (126,836 ) (11,345 ) (42,159 ) $ (98,471 ) $ 18,894 $ (4,070 ) |
Schedule of Federal Statutory Income Tax Rate to Effective Tax Rate | The income tax expense (benefit) computed using the federal statutory income tax rate differs from NetScout’s effective tax rate primarily due to the following: Year Ended March 31, 2018 2017 2016 Statutory U.S. federal tax rate 31.6 % 35.0 % 35.0 % State taxes, net of federal tax effect 6.9 9.7 3.1 Research and development tax credits 39.5 (8.2 ) 13.0 Effect of foreign operations 15.5 (6.7 ) (18.2 ) Meals and entertainment (6.7 ) 2.5 (3.5 ) Domestic production activities deduction 13.8 (4.0 ) 9.2 Change in valuation allowance (0.2 ) (0.1 ) 0.7 Transaction costs — — (19.1 ) 2017 tax act 454.1 — — Foreign withholding (21.0 ) 3.8 (6.1 ) Other permanent differences (5.8 ) 4.2 (1.6 ) 527.7 % 36.2 % 12.5 % |
Summary of Components of Net Deferred Tax Assets | The components of net deferred tax assets and liabilities are as follows (in thousands): Year Ended March 31, 2018 2017 Deferred tax assets: Accrued expenses $ 4,068 $ 4,883 Deferred revenue 12,168 8,427 Reserves 3,375 6,240 Pension and other retiree benefits 5,307 4,978 Net operating loss carryforwards 21,251 27,322 Tax credit carryforwards 6,625 5,502 Share-based compensation 5,164 6,418 Other 418 288 Total gross deferred tax assets 58,376 64,058 Valuation allowance (3,108 ) (3,374 ) Net deferred tax assets 55,268 60,684 Deferred tax liabilities: Intangible assets (195,959 ) (323,008 ) Depreciation (4,187 ) (8,695 ) Total deferred tax asset (liability) $ (144,878 ) $ (271,019 ) |
Schedule of Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits for the fiscal years ended March 31, 2018 , 2017 and 2016 is as follows (in thousands): Year Ended March 31, 2018 2017 2016 Balance at April 1, $ 2,926 $ 1,588 $ 1,038 Additions based on tax positions related to the current year 126 46 48 Release of tax positions of prior years (481 ) (154 ) — Increase in unrecognized tax benefits as a result of a tax position taken during a prior period — 1,446 502 Decrease relating to settlements with taxing authorities (356 ) — — Balance at March 31, $ 2,215 $ 2,926 $ 1,588 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Non-Cancelable Minimum Lease Commitments | At March 31, 2018 , future non-cancelable minimum lease commitments (including office space, copiers and automobiles) are as follows (in thousands): Year Ending March 31, 2019 $ 16,613 2020 13,930 2021 11,404 2022 10,538 2023 9,330 Remaining years 37,802 Total minimum lease payments $ 99,617 |
SEGMENT AND GEOGRAPHIC INFORM45
SEGMENT AND GEOGRAPHIC INFORMATION (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Summary of Total Revenue by Geography | Total revenue by geography is as follows (in thousands): Year Ended March 31, 2018 2017 2016 United States $ 581,853 $ 722,440 $ 681,569 Europe 174,445 193,441 137,411 Asia 88,917 95,735 61,566 Rest of the world 141,572 150,496 74,873 $ 986,787 $ 1,162,112 $ 955,419 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | As disclosed parenthetically within the Company's consolidated balance sheet, the Company has receivables from related parties. The following table summarizes those balances (in thousands): March 31, 2018 March 31, 2017 Danaher $ 252 $ 404 Fortive 2,935 3,181 $ 3,187 $ 3,585 As disclosed parenthetically within the Company's consolidated balance sheet, the Company has payables due to related parties. The following table summarizes those balances (in thousands): March 31, 2018 March 31, 2017 Danaher $ — $ — Fortive 369 444 $ 369 $ 444 As disclosed parenthetically within the Company's consolidated statements of operations, the Company has recorded expenses from related parties. The following table summarizes those balances (in thousands): Year Ended March 31, 2018 2017 2016 Danaher: Cost of product revenue $ — $ 4,690 $ 25,055 Cost of service revenue — 485 5,736 Research and development expenses — 1,720 16,701 Sales and marketing 2 2,273 15,430 General and administrative expenses 7 2,551 16,055 Other expense — — 379 $ 9 $ 11,719 $ 79,356 Fortive: Cost of product revenue $ 245 $ 2,539 $ — Cost of service revenue 665 260 — Research and development expenses 3 (96 ) — Sales and marketing — 150 — General and administrative expenses 1,696 1,548 — Other income (56 ) (426 ) — $ 2,553 $ 3,975 $ — As disclosed within the Company's consolidated statements of cash flows, the Company has cash flows from operating activities resulting from amounts due to related parties and due from related parties. The following table summarizes those cash flows from operating activities (in thousands): Year Ended March 31, 2018 2017 2016 Due from related party: Danaher $ 96 $ 17,310 $ (18,483 ) Fortive 347 7,745 — Total $ 443 $ 25,055 $ (18,483 ) Due to related party: Danaher $ — $ (2,954 ) $ (6,743 ) Fortive (75 ) 162 — Total $ (75 ) $ (2,792 ) $ (6,743 ) As disclosed within the Company's consolidated statements of cash flows, the Company has cash flows from investing activities resulting from amounts due from related parties. The following table summarizes those cash flows from investing activities (in thousands): Year Ended March 31, 2018 2017 2016 Due from related party: Danaher $ — $ 12,864 $ 9,306 Total $ — $ 12,864 $ 9,306 |
QUARTERLY RESULTS OF OPERATIO47
QUARTERLY RESULTS OF OPERATIONS - UNAUDITED (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Unaudited Quarterly Results of Operations | The following table sets forth certain unaudited quarterly results of operations of NetScout for the fiscal years ended March 31, 2018 and 2017 . In the opinion of management, this information has been prepared on the same basis as the audited consolidated financial statements and all necessary adjustments, consisting only of normal recurring adjustments, have been included in the amounts stated below to present fairly the quarterly information when read in conjunction with the audited consolidated financial statements and notes thereto included elsewhere in this Annual Report on Form 10-K. The quarterly operating results are not necessarily indicative of future results of operations. Three Months Ended (in thousands, except per share data) March 31, 2018 Dec. 31, Sept. 30, June 30, March 31, 2017 Dec. 31, Sept. 30, June 30, Revenue $ 235,224 $ 268,944 $ 256,863 $ 225,756 $ 318,920 $ 302,192 $ 272,048 $ 268,952 Gross profit $ 168,633 $ 204,435 $ 182,620 $ 159,194 $ 226,003 $ 220,514 $ 187,538 $ 181,918 Net income (loss) $ 16,817 $ 89,685 $ (2,468 ) $ (24,222 ) $ 22,310 $ 21,245 $ (1,266 ) $ (8,998 ) Diluted net income (loss) per share $ 0.20 $ 1.02 $ (0.03 ) $ (0.27 ) $ 0.24 $ 0.23 $ (0.01 ) $ (0.10 ) |
NATURE OF BUSINESS (Details)
NATURE OF BUSINESS (Details) | 12 Months Ended |
Mar. 31, 2018Segment | |
Accounting Policies [Abstract] | |
Number of reportable segments | 1 |
SUMMARY OF SIGNIFICANT ACCOUN49
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 3 Months Ended | 12 Months Ended | 36 Months Ended | |||||||||||
Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2018USD ($)Segmentreporting_unit$ / shares | Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) | Mar. 31, 2018USD ($)company | Apr. 01, 2018USD ($) | Jul. 12, 2017USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||
Number of reportable segments | Segment | 1 | |||||||||||||
Unrecognized accounts receivable and deferred revenue | $ 20,000,000 | $ 17,900,000 | $ 20,000,000 | $ 17,900,000 | $ 20,000,000 | |||||||||
Number of reporting units | reporting_unit | 2 | |||||||||||||
Number of companies acquired | company | 3 | |||||||||||||
Fair value of contingent liability | 5,464,000 | 5,449,000 | $ 5,464,000 | 5,449,000 | $ 5,464,000 | |||||||||
Amortization included as cost of product | 1,000,000 | 594,000 | $ 0 | |||||||||||
Capitalized software development costs | 100,000 | 1,400,000 | 100,000 | 1,400,000 | 100,000 | |||||||||
Foreign currency losses | 4,100,000 | 2,500,000 | 1,500,000 | |||||||||||
Advertising expense | 6,500,000 | 8,100,000 | 6,400,000 | |||||||||||
Net income (loss) | 16,817,000 | $ 89,685,000 | $ (2,468,000) | $ (24,222,000) | 22,310,000 | $ 21,245,000 | $ (1,266,000) | $ (8,998,000) | 79,812,000 | 33,291,000 | (28,369,000) | |||
Net cash provided by (used in) operating activities | 222,454,000 | 226,764,000 | 97,211,000 | |||||||||||
Net cash provided by (used in) financing activities | $ (220,962,000) | (89,553,000) | (17,226,000) | |||||||||||
Computer equipment and internal use software | ||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||
Estimated useful life | 3 years | |||||||||||||
Efflux Systems, Inc. | ||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||
Fair value of contingent liability | 523,000 | $ 523,000 | 523,000 | $ 523,000 | ||||||||||
Avvasi | ||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||
Fair value of contingent liability | $ 660,000 | 660,000 | ||||||||||||
Customer Concentration Risk | Accounts Receivable | Danaher | ||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||
Accounts receivable | $ 3,200,000 | 3,200,000 | $ 3,200,000 | |||||||||||
Accounting Standards Update 2016-09 | ||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||
Share-based compensation excess tax benefit amount | 700,000 | |||||||||||||
Net income (loss) | $ 700,000 | |||||||||||||
Earnings per share, basic and diluted (in USD per share) | $ / shares | $ 0.01 | |||||||||||||
Excess tax benefit from share-based compensation, operating activities | $ 700,000 | 1,000,000 | 1,900,000 | |||||||||||
Net cash provided by (used in) operating activities | 700,000 | (1,000,000) | 1,900,000 | |||||||||||
Net cash provided by (used in) financing activities | $ (700,000) | $ 1,000,000 | $ (1,900,000) | |||||||||||
Subsequent Event | Accounting Standards Update 2014-09 | ||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||
Release of deferred revenue | $ 34,900,000 | |||||||||||||
Capitalized commissions costs | $ 7,200,000 |
CASH, CASH EQUIVALENTS AND MA50
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES - Summary of Cash, Cash Equivalent and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2015 |
Cash and Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 369,821 | $ 304,880 | $ 210,711 | $ 104,893 |
Restricted cash | 910 | 846 | 186 | 186 |
Total cash, cash equivalents and restricted cash | $ 370,731 | $ 305,726 | $ 210,897 | $ 105,079 |
CASH, CASH EQUIVALENTS AND MA51
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES - Summary of Marketable Securities Classified as Short-term and Long-term (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 31, 2017 |
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Amortized Cost | $ 78,003 | $ 159,868 |
Unrealized Losses | (62) | (43) |
Fair Value | 77,941 | 159,825 |
U.S. government and municipal obligations | ||
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Fair Value | 42,186 | 120,901 |
Commercial paper | ||
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Fair Value | 33,003 | 29,469 |
Corporate bonds | ||
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Fair Value | 2,752 | 7,956 |
Certificates of deposit | ||
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Fair Value | 1,499 | |
Short-term marketable securities | ||
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Amortized Cost | 78,003 | 137,916 |
Unrealized Losses | (62) | (24) |
Fair Value | 77,941 | 137,892 |
Short-term marketable securities | U.S. government and municipal obligations | ||
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Amortized Cost | 42,246 | 98,989 |
Unrealized Losses | (60) | (21) |
Fair Value | 42,186 | 98,968 |
Short-term marketable securities | Commercial paper | ||
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Amortized Cost | 33,003 | 29,469 |
Unrealized Losses | 0 | 0 |
Fair Value | 33,003 | 29,469 |
Short-term marketable securities | Corporate bonds | ||
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Amortized Cost | 2,754 | 7,959 |
Unrealized Losses | (2) | (3) |
Fair Value | 2,752 | 7,956 |
Short-term marketable securities | Certificates of deposit | ||
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Amortized Cost | 1,499 | |
Unrealized Losses | 0 | |
Fair Value | 1,499 | |
Long-term marketable securities | ||
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Amortized Cost | 0 | 21,952 |
Unrealized Losses | 0 | (19) |
Fair Value | $ 0 | 21,933 |
Long-term marketable securities | U.S. government and municipal obligations | ||
Cash, Cash Equivalents and Marketable Securities [Line Items] | ||
Amortized Cost | 21,952 | |
Unrealized Losses | (19) | |
Fair Value | $ 21,933 |
CASH, CASH EQUIVALENTS AND MA52
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES - Summary of Contractual Maturities of Marketable Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 31, 2017 |
Available-for-sale securities: | ||
Due in 1 year or less | $ 77,941 | $ 137,892 |
Due after 1 year through 5 years | 0 | 21,933 |
Fair Value | $ 77,941 | $ 159,825 |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 31, 2017 |
ASSETS: | ||
Cash and cash equivalents | $ 369,821 | $ 304,880 |
Investments | 77,941 | 159,825 |
Derivative financial instruments | 122 | 110 |
Total assets | 447,884 | 464,815 |
LIABILITIES: | ||
Contingent purchase consideration | (5,464) | (5,449) |
Derivative financial instruments | (40) | (213) |
Total liabilities | (5,504) | (5,662) |
U.S. government and municipal obligations | ||
ASSETS: | ||
Investments | 42,186 | 120,901 |
Commercial paper | ||
ASSETS: | ||
Investments | 33,003 | 29,469 |
Corporate bonds | ||
ASSETS: | ||
Investments | 2,752 | 7,956 |
Certificates of deposit | ||
ASSETS: | ||
Investments | 1,499 | |
Level 1 | ||
ASSETS: | ||
Cash and cash equivalents | 369,821 | 304,880 |
Derivative financial instruments | 0 | 0 |
Total assets | 387,086 | 353,464 |
LIABILITIES: | ||
Contingent purchase consideration | 0 | 0 |
Derivative financial instruments | 0 | 0 |
Total liabilities | 0 | 0 |
Level 1 | U.S. government and municipal obligations | ||
ASSETS: | ||
Investments | 14,513 | 40,628 |
Level 1 | Commercial paper | ||
ASSETS: | ||
Investments | 0 | 0 |
Level 1 | Corporate bonds | ||
ASSETS: | ||
Investments | 2,752 | 7,956 |
Level 1 | Certificates of deposit | ||
ASSETS: | ||
Investments | 0 | |
Level 2 | ||
ASSETS: | ||
Cash and cash equivalents | 0 | 0 |
Derivative financial instruments | 122 | 110 |
Total assets | 60,798 | 111,351 |
LIABILITIES: | ||
Contingent purchase consideration | 0 | 0 |
Derivative financial instruments | (40) | (213) |
Total liabilities | (40) | (213) |
Level 2 | U.S. government and municipal obligations | ||
ASSETS: | ||
Investments | 27,673 | 80,273 |
Level 2 | Commercial paper | ||
ASSETS: | ||
Investments | 33,003 | 29,469 |
Level 2 | Corporate bonds | ||
ASSETS: | ||
Investments | 0 | 0 |
Level 2 | Certificates of deposit | ||
ASSETS: | ||
Investments | 1,499 | |
Level 3 | ||
ASSETS: | ||
Cash and cash equivalents | 0 | 0 |
Derivative financial instruments | 0 | 0 |
Total assets | 0 | 0 |
LIABILITIES: | ||
Contingent purchase consideration | (5,464) | (5,449) |
Derivative financial instruments | 0 | 0 |
Total liabilities | (5,464) | (5,449) |
Level 3 | U.S. government and municipal obligations | ||
ASSETS: | ||
Investments | 0 | 0 |
Level 3 | Commercial paper | ||
ASSETS: | ||
Investments | 0 | 0 |
Level 3 | Corporate bonds | ||
ASSETS: | ||
Investments | $ 0 | 0 |
Level 3 | Certificates of deposit | ||
ASSETS: | ||
Investments | $ 0 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Jul. 12, 2017 | Nov. 30, 2011 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value of contingent liability | $ 5,464 | $ 5,449 | ||
Fair value, measurements, recurring | Contingent consideration | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liability adjustment included in earnings | 152 | 153 | ||
Level 3 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value of contingent liability | 5,464 | 5,449 | ||
Efflux Systems, Inc. | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value of contingent liability | 523 | $ 523 | ||
Efflux Systems, Inc. | Level 3 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value of contingent liability | 523 | |||
Avvasi | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value of contingent liability | 660 | |||
Avvasi | Level 3 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value of contingent liability | 660 | |||
Simena LLC | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value of contingent liability | 4,900 | 4,800 | $ 8,000 | |
Simena LLC | Level 3 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value of contingent liability | $ 4,900 | $ 4,800 |
FAIR VALUE MEASUREMENTS - Sch55
FAIR VALUE MEASUREMENTS - Schedule of Reconciliation of Changes in Fair Value of Level 3 Financial Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Payments received | $ 0 | $ 12,864 | $ 9,306 |
Payments made | 660 | 0 | 0 |
Fair value, measurements, recurring | Contingent Purchase Consideration | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Beginning balance | (5,449) | (7,293) | |
Additions to Level 3 | (523) | (660) | |
Increase in fair value and accretion expense (included within research and development expense) | (152) | (153) | |
Gross presentation of contingently returnable consideration to contingent purchase consideration | (3,910) | ||
Payments made | 660 | 6,567 | |
Ending balance | (5,464) | (5,449) | (7,293) |
Fair value, measurements, recurring | Contingently Returnable Consideration | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Beginning balance | $ 0 | (16,131) | |
Decrease in fair value | (610) | ||
Gross presentation of contingently returnable consideration to contingent purchase consideration | 3,910 | ||
Payments received | (19,431) | ||
Ending balance | $ 0 | $ (16,131) |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 31, 2017 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 20,860 | $ 22,305 |
Work in process | 2,589 | 998 |
Finished goods and deferred costs | 11,325 | 16,699 |
Total inventories | $ 34,774 | $ 40,002 |
FIXED ASSETS - Schedule of Fixe
FIXED ASSETS - Schedule of Fixed Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Fixed assets, gross | $ 204,511 | $ 186,195 |
Less – accumulated depreciation | (152,000) | (124,802) |
Fixed assets, net | 52,511 | 61,393 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Fixed assets, gross | $ 6,596 | 6,436 |
Furniture and fixtures | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years | |
Furniture and fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 7 years | |
Computer equipment and internal use software | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years | |
Fixed assets, gross | $ 147,237 | 135,100 |
Computer equipment and internal use software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years | |
Computer equipment and internal use software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 5 years | |
Demonstration and spare part units | ||
Property, Plant and Equipment [Line Items] | ||
Fixed assets, gross | $ 31,338 | 28,036 |
Demonstration and spare part units | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 2 years | |
Demonstration and spare part units | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 5 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Fixed assets, gross | $ 19,340 | $ 16,623 |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 12 years |
FIXED ASSETS - Narrative (Detai
FIXED ASSETS - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 34.7 | $ 33 | $ 26.6 |
ACQUISITIONS - Narrative (Detai
ACQUISITIONS - Narrative (Details) - USD ($) $ / shares in Units, shares in Millions | Jul. 12, 2017 | Aug. 19, 2016 | Jul. 14, 2015 | Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | Jul. 13, 2015 |
Business Acquisition [Line Items] | |||||||
Fair value of contingent liability | $ 5,464,000 | $ 5,449,000 | |||||
Goodwill | $ 1,712,764,000 | 1,718,162,000 | $ 1,709,369,000 | ||||
Weighted average useful life of acquired intangible assets | 14 years 7 months 2 days | ||||||
Service Assurance reporting unit | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill | $ 1,200,000,000 | 1,200,000,000 | |||||
Cash retention award | Vesting after August 4, 2015 | |||||||
Business Acquisition [Line Items] | |||||||
Percent of cancelled Danaher equity awards replaced | 50.00% | ||||||
Restricted stock units | Vesting after August 4, 2015 | |||||||
Business Acquisition [Line Items] | |||||||
Total equity consideration | $ 15,000,000 | ||||||
Percent of cancelled Danaher equity awards replaced | 50.00% | ||||||
Post combination compensation expense, Danaher equity awards | Vesting July 14, 2015 through August 4, 2015 | |||||||
Business Acquisition [Line Items] | |||||||
Post combination compensation expense | $ 0 | 0 | 6,500,000 | ||||
Post combination compensation expense, Danaher equity awards | Vesting after August 4, 2015 | |||||||
Business Acquisition [Line Items] | |||||||
Post combination compensation expense | 0 | 4,300,000 | 8,000,000 | ||||
Post combination compensation expense, Danaher bonus | |||||||
Business Acquisition [Line Items] | |||||||
Post combination compensation expense | 0 | 0 | 9,300,000 | ||||
Post combination compensation expense, Danaher retention | |||||||
Business Acquisition [Line Items] | |||||||
Post combination compensation expense | 0 | 0 | $ 7,800,000 | ||||
Common stock Voting | |||||||
Business Acquisition [Line Items] | |||||||
Share price (in dollars per share) | $ 36.89 | ||||||
Efflux Systems, Inc. | |||||||
Business Acquisition [Line Items] | |||||||
Estimated purchase price | $ 8,627,000 | ||||||
Fair value of contingent liability | 523,000 | $ 523,000 | |||||
Goodwill | $ 6,077,000 | ||||||
Weighted average useful life of acquired intangible assets | 10 years | ||||||
Avvasi | |||||||
Business Acquisition [Line Items] | |||||||
Estimated purchase price | $ 4,600,000 | ||||||
Fair value of contingent liability | $ 660,000 | ||||||
Avvasi | Service Assurance reporting unit | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill | $ 2,000,000 | ||||||
Communications Business | |||||||
Business Acquisition [Line Items] | |||||||
Total equity consideration | $ 2,300,000,000 | ||||||
Communications Business | Common stock Voting | Newco | |||||||
Business Acquisition [Line Items] | |||||||
Shares issued in business acquisition (in shares) | 62.5 |
ACQUISITIONS - Summary of Purch
ACQUISITIONS - Summary of Purchase Price Allocation (Details) - USD ($) $ in Thousands | Jul. 12, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 |
Estimated fair value of assets acquired and liabilities assumed: | ||||
Goodwill | $ 1,712,764 | $ 1,718,162 | $ 1,709,369 | |
Efflux Systems, Inc. | ||||
Business Acquisition [Line Items] | ||||
Initial cash payment | $ 8,104 | |||
Estimated fair value of contingent purchase consideration | 523 | |||
Estimated purchase price | 8,627 | |||
Estimated fair value of assets acquired and liabilities assumed: | ||||
Cash | 93 | |||
Accounts receivable | 3 | |||
Prepaid and other current assets | 208 | |||
Property, plant and equipment | 8 | |||
Intangible assets | 2,590 | |||
Deferred tax asset | 841 | |||
Accounts payable | (7) | |||
Accrued other liabilities | (200) | |||
Deferred revenue | (8) | |||
Deferred tax liabilities | (978) | |||
Goodwill | $ 6,077 |
ACQUISITIONS - Schedule of Fair
ACQUISITIONS - Schedule of Fair value of Acquired Identifiable Intangible Assets and Related Estimates of Useful Lives (Details) - USD ($) $ in Thousands | Jul. 12, 2017 | Mar. 31, 2018 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted average useful life of acquired intangible assets | 14 years 7 months 2 days | |
Efflux Systems, Inc. | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Fair value of finite-lived intangible assets | $ 2,590 | |
Weighted average useful life of acquired intangible assets | 10 years | |
Efflux Systems, Inc. | Developed technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Fair value of finite-lived intangible assets | $ 1,980 | |
Weighted average useful life of acquired intangible assets | 10 years | |
Efflux Systems, Inc. | Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Fair value of finite-lived intangible assets | $ 610 | |
Weighted average useful life of acquired intangible assets | 10 years |
GOODWILL AND INTANGIBLE ASSET62
GOODWILL AND INTANGIBLE ASSETS - Narrative (Details) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018USD ($)reporting_unit | Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Number of reporting units | reporting_unit | 2 | ||
Goodwill | $ 1,712,764 | $ 1,718,162 | $ 1,709,369 |
Carrying value of intangible assets | 831,374 | 931,269 | |
Amortization expenses | $ 116,956 | 126,089 | $ 84,421 |
Weighted average useful life of acquired intangible assets | 14 years 7 months 2 days | ||
Technology license | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets acquired | $ 500 | $ 1,000 | |
Weighted average useful life of acquired intangible assets | 3 years | ||
Developed and core technology | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted average useful life of acquired intangible assets | 11 years 6 months | ||
Customer and distributor relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted average useful life of acquired intangible assets | 16 years 1 month 18 days | ||
Trademarks and trade names | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted average useful life of acquired intangible assets | 8 years 6 months | ||
Leasehold interest | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted average useful life of acquired intangible assets | 5 years 7 months | ||
Backlog | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted average useful life of acquired intangible assets | 2 years | ||
Capitalized software | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted average useful life of acquired intangible assets | 4 years | ||
Trade name | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets | $ 18,600 | $ 18,600 | |
Service Assurance reporting unit | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | 1,200,000 | 1,200,000 | |
Security reporting unit | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | $ 555,900 | $ 548,500 |
GOODWILL AND INTANGIBLE ASSET63
GOODWILL AND INTANGIBLE ASSETS - Schedule of Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 1,718,162 | $ 1,709,369 |
Goodwill acquired | 6,077 | 1,950 |
Purchase accounting adjustments | 3,792 | |
Foreign currency translation impact | (11,475) | 3,051 |
Ending balance | $ 1,712,764 | $ 1,718,162 |
GOODWILL AND INTANGIBLE ASSET64
GOODWILL AND INTANGIBLE ASSETS - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 31, 2017 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 1,192,226 | $ 1,170,562 |
Accumulated Amortization | (379,452) | (257,893) |
Net | 812,774 | 912,669 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 259,758 | 254,005 |
Accumulated Amortization | (148,937) | (110,200) |
Net | 110,821 | 143,805 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 845,490 | 831,731 |
Accumulated Amortization | (176,425) | (105,319) |
Net | 669,065 | 726,412 |
Distributor relationships and technology licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 9,019 | 8,290 |
Accumulated Amortization | (5,389) | (3,068) |
Net | 3,630 | 5,222 |
Definite-lived trademark and trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 44,387 | 43,817 |
Accumulated Amortization | (18,138) | (12,078) |
Net | 26,249 | 31,739 |
Core technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 7,345 | 7,108 |
Accumulated Amortization | (6,712) | (6,009) |
Net | 633 | 1,099 |
Net beneficial leases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 336 | 336 |
Accumulated Amortization | (336) | (336) |
Net | 0 | 0 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 317 | 278 |
Accumulated Amortization | (317) | (278) |
Net | 0 | 0 |
Leasehold interest | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 2,600 | 2,600 |
Accumulated Amortization | (2,130) | (998) |
Net | 470 | 1,602 |
Backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 18,544 | 18,142 |
Accumulated Amortization | (18,544) | (18,133) |
Net | 0 | 9 |
Capitalized software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 3,183 | 3,047 |
Accumulated Amortization | (1,621) | (594) |
Net | 1,562 | 2,453 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 1,247 | 1,208 |
Accumulated Amortization | (903) | (880) |
Net | $ 344 | $ 328 |
GOODWILL AND INTANGIBLE ASSET65
GOODWILL AND INTANGIBLE ASSETS - Schedule of Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expenses | $ 116,956 | $ 126,089 | $ 84,421 |
Product revenue | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expenses | 9 | 11,438 | 6,747 |
Cost of product revenue | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expenses | 40,286 | 44,326 | 45,127 |
Operating expense | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expenses | $ 76,661 | $ 70,325 | $ 32,547 |
GOODWILL AND INTANGIBLE ASSET66
GOODWILL AND INTANGIBLE ASSETS - Schedule of Expected Future Amortization Expense (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 31, 2017 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2,019 | $ 130,108 | |
2,020 | 116,494 | |
2,021 | 80,232 | |
2,022 | 69,778 | |
2,023 | 62,045 | |
Thereafter | 354,117 | |
Net | $ 812,774 | $ 912,669 |
DERIVATIVE INSTRUMENTS AND HE67
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Narrative (Details) | 12 Months Ended |
Mar. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Hedging forecasted cash flows for operating expenses denominated in foreign currencies managed in months (up to) | 12 months |
Contract maturing over next months | 12 months |
DERIVATIVE INSTRUMENTS AND HE68
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Summary of Notional Amounts and Fair Values of Derivative Instruments on Consolidated Balance Sheet (Details) - Forward contracts - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 31, 2017 |
Derivatives, Fair Value [Line Items] | ||
Notional Amounts | $ 11,225 | $ 14,752 |
Prepaid Expenses and Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Prepaid Expenses and Other Current Assets | 122 | 110 |
Accrued Other | ||
Derivatives, Fair Value [Line Items] | ||
Accrued Other | $ 40 | $ 213 |
DERIVATIVE INSTRUMENTS AND HE69
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Summary of Effect of Foreign Exchange Forward Contracts on Other Comprehensive Income And Results Of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) Recognized in OCI on Derivative | $ 1,079 | $ (444) |
Gain (Loss) Reclassified from Accumulated OCI into Income | (900) | 358 |
Gain (Loss) Recognized in Income (Amount Excluded from Effectiveness Testing) | (93) | (109) |
Forward contracts | Research and development | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) Recognized in OCI on Derivative | 1,079 | (444) |
Gain (Loss) Reclassified from Accumulated OCI into Income | (121) | (3) |
Gain (Loss) Recognized in Income (Amount Excluded from Effectiveness Testing) | 60 | 74 |
Forward contracts | Sales and marketing | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) Reclassified from Accumulated OCI into Income | (779) | 361 |
Gain (Loss) Recognized in Income (Amount Excluded from Effectiveness Testing) | $ (153) | $ (183) |
RESTRUCTURING CHARGES - Narrati
RESTRUCTURING CHARGES - Narrative (Details) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018USD ($)Employee | Mar. 31, 2017USD ($)planEmployee | Mar. 31, 2016USD ($)Employee | |
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 5,209 | $ 4,001 | $ 468 |
Number of restructuring plans | plan | 2 | ||
Employee-Related | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 500 | ||
Number of employees terminated | Employee | 1 | ||
FY2017 Plans | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 900 | ||
Q1 FY2017 Plan | Employee-Related | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 2,000 | ||
Number of employees terminated | Employee | 19 | ||
Q4 FY2017 Plan | Employee-Related | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 1,900 | ||
Number of employees terminated | Employee | 41 | ||
Q4 FY2017 Plan | Facilities Related | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 400 | ||
Q3 FY2018 Plan | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring expected cost remaining | 1,700 | ||
Q3 FY2018 Plan | Employee-Related | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 5,100 | ||
Number of employees terminated | Employee | 61 |
RESTRUCTURING CHARGES - Schedul
RESTRUCTURING CHARGES - Schedule of Restructuring Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Restructuring Reserve [Roll Forward] | ||
Beginning Balance | $ 1,955 | $ 272 |
Restructuring charges to operations | 6,022 | 4,306 |
Cash payments | (3,572) | (2,328) |
Other adjustments | (709) | (295) |
Ending Balance | 3,696 | 1,955 |
Employee-Related | Q3 FY2016 Plan | ||
Restructuring Reserve [Roll Forward] | ||
Beginning Balance | 0 | 272 |
Restructuring charges to operations | 0 | 0 |
Cash payments | 0 | (272) |
Other adjustments | 0 | 0 |
Ending Balance | 0 | 0 |
Employee-Related | Q1 FY2017 Plan | ||
Restructuring Reserve [Roll Forward] | ||
Beginning Balance | 0 | 0 |
Restructuring charges to operations | 0 | 2,034 |
Cash payments | 0 | (1,739) |
Other adjustments | 0 | (295) |
Ending Balance | 0 | 0 |
Employee-Related | Q4 FY2017 Plan | ||
Restructuring Reserve [Roll Forward] | ||
Beginning Balance | 1,550 | 0 |
Restructuring charges to operations | 729 | 1,867 |
Cash payments | (1,867) | (317) |
Other adjustments | (412) | 0 |
Ending Balance | 0 | 1,550 |
Employee-Related | Q3 FY2018 Plan | ||
Restructuring Reserve [Roll Forward] | ||
Beginning Balance | 0 | 0 |
Restructuring charges to operations | 5,085 | 0 |
Cash payments | (1,331) | 0 |
Other adjustments | (58) | 0 |
Ending Balance | 3,696 | 0 |
Facilities Related | Q4 FY2017 Plan | ||
Restructuring Reserve [Roll Forward] | ||
Beginning Balance | 405 | 0 |
Restructuring charges to operations | 208 | 405 |
Cash payments | (374) | 0 |
Other adjustments | (239) | 0 |
Ending Balance | $ 0 | $ 405 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) | Apr. 01, 2018 | Jan. 16, 2018USD ($) | Mar. 31, 2018USD ($) | Mar. 31, 2018USD ($) | Feb. 01, 2018USD ($) |
Maximum | |||||
Debt Instrument [Line Items] | |||||
Consolidated leverage ratio | 2.75 | ||||
Minimum | |||||
Debt Instrument [Line Items] | |||||
Consolidated leverage ratio | 1.50 | ||||
Senior secured revolving credit facility | Line of credit | |||||
Debt Instrument [Line Items] | |||||
Amount outstanding under credit facility | $ 600,000,000 | $ 600,000,000 | $ 300,000,000 | ||
Commitment fee percentage | 0.25% | ||||
Debt default, acceleration clause, required consent percentage | 50.00% | 50.00% | |||
Debt issuance costs | $ 12,200,000 | $ 12,200,000 | |||
Unamortized debt issuance costs | 8,300,000 | 8,300,000 | |||
Senior secured revolving credit facility | Line of credit | Prepaid Expenses and Other Current Assets | |||||
Debt Instrument [Line Items] | |||||
Unamortized debt issuance costs | 1,700,000 | 1,700,000 | |||
Senior secured revolving credit facility | Line of credit | Other assets | |||||
Debt Instrument [Line Items] | |||||
Unamortized debt issuance costs | $ 6,600,000 | $ 6,600,000 | |||
Senior secured revolving credit facility | Line of credit | Maximum | |||||
Debt Instrument [Line Items] | |||||
Commitment fee percentage | 0.30% | ||||
Senior secured revolving credit facility | Line of credit | Maximum | Foreign Subsidiaries | |||||
Debt Instrument [Line Items] | |||||
Voting stock pledge limit for any foreign subsidiary | 65.00% | 65.00% | |||
Senior secured revolving credit facility | Line of credit | Minimum | |||||
Debt Instrument [Line Items] | |||||
Commitment fee percentage | 0.15% | ||||
Senior secured revolving credit facility | Line of credit | Federal funds effective rate | |||||
Debt Instrument [Line Items] | |||||
Interest rate in excess of effective rate | 0.50% | ||||
Senior secured revolving credit facility | Line of credit | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Interest rate in excess of effective rate | 1.00% | ||||
Senior secured revolving credit facility | Line of credit | LIBOR | LIBOR loans | |||||
Debt Instrument [Line Items] | |||||
Interest rate in excess of effective rate | 1.50% | ||||
Senior secured revolving credit facility | Line of credit | Base rate | Base rate loans | |||||
Debt Instrument [Line Items] | |||||
Interest rate in excess of effective rate | 0.50% | ||||
Senior secured revolving credit facility | Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Debt term | 5 years | ||||
Credit facility | $ 1,000,000,000 | ||||
Letter of credit sub-facility | Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Credit facility | $ 75,000,000 | ||||
Subsequent Event | Maximum | |||||
Debt Instrument [Line Items] | |||||
Consolidated leverage ratio | 3.50 | ||||
Subsequent Event | Minimum | |||||
Debt Instrument [Line Items] | |||||
Consolidated leverage ratio | 1.50 | ||||
Subsequent Event | Senior secured revolving credit facility | Line of credit | LIBOR | LIBOR loans | Maximum | |||||
Debt Instrument [Line Items] | |||||
Interest rate in excess of effective rate | 2.00% | ||||
Subsequent Event | Senior secured revolving credit facility | Line of credit | LIBOR | LIBOR loans | Minimum | |||||
Debt Instrument [Line Items] | |||||
Interest rate in excess of effective rate | 1.00% | ||||
Subsequent Event | Senior secured revolving credit facility | Line of credit | Base rate | Base rate loans | Maximum | |||||
Debt Instrument [Line Items] | |||||
Interest rate in excess of effective rate | 1.00% | ||||
Subsequent Event | Senior secured revolving credit facility | Line of credit | Base rate | Base rate loans | Minimum | |||||
Debt Instrument [Line Items] | |||||
Interest rate in excess of effective rate | 0.00% |
NET INCOME (LOSS) PER SHARE - S
NET INCOME (LOSS) PER SHARE - Schedule of Calculations of Basic and Diluted Net Income per Share and Potential Common Shares (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 02, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 |
Numerator: | ||||||||||||
Net income (loss) | $ 16,817 | $ 89,685 | $ (2,468) | $ (24,222) | $ 22,310 | $ 21,245 | $ (1,266) | $ (8,998) | $ 79,812 | $ 33,291 | $ (28,369) | |
Weighted Average Number of Shares Outstanding, Basic [Abstract] | ||||||||||||
Denominator for basic net income per share - weighted average common shares outstanding (in shares) | 87,425,000 | 92,226,000 | 81,927,000 | |||||||||
Dilutive common equivalent shares: | ||||||||||||
Weighted average restricted stock units (in shares) | 836,000 | 694,000 | 0 | |||||||||
Denominator for diluted net income per share - weighted average shares outstanding (in shares) | 88,261,000 | 92,920,000 | 81,927,000 | |||||||||
Net income (loss) per share: | ||||||||||||
Basic net income (loss) per share (in dollars per share) | $ 0.91 | $ 0.36 | $ (0.35) | |||||||||
Diluted net income (loss) per share (in dollars per share) | $ 0.20 | $ 1.02 | $ (0.03) | $ (0.27) | $ 0.24 | $ 0.23 | $ (0.01) | $ (0.10) | $ 0.90 | $ 0.36 | $ (0.35) | |
Shares repurchased during the period (in shares) | 7,387,862 |
NET INCOME (LOSS) PER SHARE -74
NET INCOME (LOSS) PER SHARE - Summary of Antidilutive Securities Excluded from Computation of Diluted EPS (Details) - shares shares in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Restricted stock units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluding from calculation of diluted net income per share (in shares) | 1,450 | 1,320 | 453 |
TREASURY STOCK (Details)
TREASURY STOCK (Details) - USD ($) | Feb. 02, 2018 | Feb. 01, 2018 | Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | Jul. 15, 2015 | Oct. 24, 2017 | May 19, 2015 | Apr. 22, 2014 |
Equity, Class of Treasury Stock [Line Items] | |||||||||
Shares repurchased during the period (in shares) | 7,387,862 | ||||||||
Shares repurchased during the period, value | $ 501,324,000 | $ 79,996,000 | $ 302,784,000 | ||||||
Shares repurchased during the period from each of the dealers | 3,693,931 | ||||||||
Shares repurchased as percentage of total expected to be repurchased | 70.00% | ||||||||
Dealer one | |||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||
Shares repurchased during the period, value | $ 150,000,000 | ||||||||
Dealer two | |||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||
Shares repurchased during the period, value | $ 150,000,000 | ||||||||
Restricted stock units | |||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||
Shares repurchased during the period (in shares) | 408,097 | 320,572 | 256,514 | ||||||
Shares repurchased during the period, value | $ 13,600,000 | $ 9,600,000 | $ 9,100,000 | ||||||
Share repurchase program, April 2014 | |||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||
Stock authorized to repurchase amount | $ 100,000,000 | ||||||||
Shares repurchased during the period (in shares) | 67,752 | 824,452 | |||||||
Shares repurchased during the period, value | $ 2,800,000 | $ 34,300,000 | |||||||
Common stock available to be purchased | 0 | ||||||||
Share repurchase program, May 2015 | |||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||
Shares repurchased during the period (in shares) | 970,650 | 6,773,438 | 3,148,426 | 10,078,136 | |||||
Shares repurchased during the period, value | $ 27,600,000 | $ 227,600,000 | $ 80,000,000 | $ 300,000,000 | |||||
Common stock available to be purchased | 0 | ||||||||
Stock authorized to repurchase under stock repurchase program (in shares) | 20,000,000 | ||||||||
Share repurchase program, October 2017 | |||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||
Shares repurchased during the period (in shares) | 6,417,212 | ||||||||
Shares repurchased during the period, value | $ 182,400,000 | ||||||||
Common stock available to be purchased | 18,582,788 | ||||||||
Stock authorized to repurchase under stock repurchase program (in shares) | 25,000,000 | ||||||||
Senior secured revolving credit facility | Line of credit | |||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||
Amount outstanding under credit facility | $ 300,000,000 | $ 600,000,000 |
STOCK PLANS - Narrative (Detail
STOCK PLANS - Narrative (Details) | Sep. 07, 2011USD ($)shares | Sep. 30, 2007 | Mar. 31, 2018USD ($)$ / sharesshares | Mar. 31, 2017 | Mar. 31, 2016 | Sep. 22, 2015shares |
Employee stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares purchased by employees | 610,947 | |||||
Shares issued under ESPP plan, weighted average purchase price per share (in dollars per share) | $ / shares | $ 29.22 | |||||
Shares available for future issuance under the ESPP | 485,143 | |||||
Incentive options | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Term of options granted, years | 5 years | |||||
Restricted stock units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Total unrecognized compensation cost | $ | $ 100,800,000 | |||||
Unrecognized cost, period for recognition, years | 1 year 5 months 1 day | |||||
2011 Employee Stock Purchase Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock, equity awards reserved for issuance | 2,500,000 | |||||
Maximum payroll deductions for purchase of shares by participants | 20.00% | |||||
Maximum number of shares available for purchased by participants | 2,000 | |||||
Cap on fair value of shares available for purchase by participants | $ | $ 25,000 | |||||
Percentage of common stock price for employees | 85.00% | |||||
2011 Employee Stock Purchase Plan | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Cap on fair value of shares available for purchase by participants | $ | $ 50,000 | |||||
2007 Equity Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock, equity awards reserved for issuance | 21,500,000 | |||||
Shares available for grant | 6,048,327 | |||||
Restoration ratio of restricted stock unit grants withheld | 2 | |||||
Reduction for each share of common stock pursuant to option | 1 | |||||
Reduction for each share of common stock pursuant to other than option | 2 | |||||
Equity awards outstanding | 4,078,780 | |||||
Share-based awards generally vest, years | 4 years | |||||
Percentage of incentive stock option granted | 110.00% | |||||
2007 Equity Incentive Plan | Common stock voting | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock, equity awards reserved for issuance | 8,000,000 | 8,500,000 | ||||
2007 Equity Incentive Plan | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Percentage of fair market value of common stock | 100.00% | |||||
Percentage of voting stock | 10.00% | |||||
2007 Equity Incentive Plan | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Term of options granted, years | 10 years | |||||
Independent Directors | 2007 Equity Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Percentage of incentive stock option granted | 0.00% | 0.00% | ||||
Percentage of annualized forfeiture rate for awards granted | 0.00% | |||||
Employees | 2007 Equity Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Percentage of incentive stock option granted | 5.00% | 5.00% | ||||
Percentage of annualized forfeiture rate for awards granted | 5.00% | |||||
Senior Executives | 2007 Equity Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Percentage of incentive stock option granted | 2.00% | 2.00% | ||||
Percentage of annualized forfeiture rate for awards granted | 2.00% |
STOCK PLANS - Summary of Share-
STOCK PLANS - Summary of Share-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | $ 47,317 | $ 39,189 | $ 28,351 |
Cost of product revenue | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | 1,159 | 934 | 645 |
Cost of service revenue | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | 4,824 | 3,956 | 2,601 |
Research and development | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | 14,711 | 12,362 | 9,205 |
Sales and marketing | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | 15,213 | 12,823 | 8,725 |
General and administrative | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | $ 11,410 | $ 9,114 | $ 7,175 |
STOCK PLANS - Summary of Transa
STOCK PLANS - Summary of Transactions under Amended 2007 Equity Incentive Plan (Details) - $ / shares | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Restricted Stock Units, Number of Awards | |||
Beginning outstanding balance (in shares) | 3,610,301 | 2,873,306 | 1,929,315 |
Granted (in shares) | 1,962,590 | 2,020,536 | 1,806,490 |
Exercised (Options)/Issued (RSU’s) (in shares) | (1,216,585) | (950,159) | (736,170) |
Canceled (in shares) | (277,526) | (333,382) | (126,329) |
Ending outstanding balance (in shares) | 4,078,780 | 3,610,301 | 2,873,306 |
Restricted Stock Units, Weighted Average Fair Value | |||
Beginning outstanding balance (in dollars per share) | $ 30.24 | $ 35.32 | $ 30.18 |
Granted (in dollars per share) | 34.01 | 24.92 | 37.20 |
Exercised (Options)/Issued (RSU’s) (in dollars per share) | 31.09 | 33.16 | 26.52 |
Canceled (in dollars per share) | 31.70 | 33.40 | 34.99 |
Ending outstanding balance (in dollars per share) | $ 31.77 | $ 30.24 | $ 35.32 |
STOCK PLANS - Schedule of Aggre
STOCK PLANS - Schedule of Aggregate Intrinsic Values of Stock Options and Restricted Stock Units (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Restricted stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total fair value of restricted stock unit awards vested | $ 40,539 | $ 28,293 | $ 25,936 |
PENSION BENEFIT PLANS - Narrati
PENSION BENEFIT PLANS - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Retirement Benefits [Abstract] | |||
Retirement plan employee's contribution, percentage matched | 50.00% | ||
Retirement plan employee's contribution, percentage of match | 6.00% | ||
Retirement plan employer contributions vest at rate per year of service, percentage | 25.00% | ||
Retirement plan employer contributions | $ 8 | $ 9.4 | $ 7.8 |
Unrecognized actuarial gains, before tax | 1.8 | ||
Unrecognized actuarial gains, net of tax | $ 1.4 |
PENSION BENEFIT PLANS - Defined
PENSION BENEFIT PLANS - Defined Benefit Pension Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | |||
Benefit obligation, at beginning of year | $ 30,141 | $ 29,188 | |
Service cost | 407 | 329 | $ 279 |
Interest cost | 718 | 638 | 391 |
Benefits paid and other | (288) | (231) | |
Actuarial loss (gain) | (1,788) | 1,226 | |
Foreign exchange rate impact | 4,274 | (1,009) | |
Benefit obligation, at end of year | 33,464 | 30,141 | 29,188 |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||
Fair value of plan assets, at beginning of year | 0 | 0 | |
Employer direct benefit payments | 288 | 231 | |
Benefits paid and other | (288) | (231) | |
Fair value of plan assets, at end of year | 0 | 0 | 0 |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | |||
Service cost | 407 | 329 | 279 |
Interest cost | 718 | 638 | 391 |
Net periodic pension cost | $ 1,125 | $ 967 | $ 670 |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | |||
Discount rate | 2.30% | 2.10% | 2.30% |
Rate of compensation increase | 2.25% | 2.25% | 2.25% |
PENSION BENEFIT PLANS - Expecte
PENSION BENEFIT PLANS - Expected Contributions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Retirement Benefits [Abstract] | ||
Employer direct benefit payments | $ 288 | $ 231 |
Defined Benefit Plan, Expected Future Benefit Payment [Abstract] | ||
2,019 | 380 | |
2,020 | 442 | |
2,021 | 502 | |
2,022 | 556 | |
2,023 | 627 | |
2024-2029 | $ 4,546 |
INCOME TAXES - Schedule of Inco
INCOME TAXES - Schedule of Income Before Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (35,032) | $ 32,475 | $ (6,979) |
Foreign | 16,373 | 19,710 | (25,460) |
Income before income tax expense | $ (18,659) | $ 52,185 | $ (32,439) |
INCOME TAXES - Summary of Compo
INCOME TAXES - Summary of Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Current income tax expense: | |||
Federal | $ 14,191 | $ 15,912 | $ 29,238 |
State | 1,925 | 3,152 | 2,223 |
Foreign | 12,249 | 11,175 | 6,628 |
Current income tax expense, Total | 28,365 | 30,239 | 38,089 |
Deferred income tax expense (benefit): | |||
Federal | (113,122) | (8,278) | (30,216) |
State | (10,037) | 3,578 | (4,461) |
Foreign | (3,677) | (6,645) | (7,482) |
Deferred income tax expense (benefit), Total | (126,836) | (11,345) | (42,159) |
Income tax expense (benefit), Total | $ (98,471) | $ 18,894 | $ (4,070) |
INCOME TAXES - Schedule of Fede
INCOME TAXES - Schedule of Federal Statutory Income Tax Rate to Effective Tax Rate (Details) | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
Statutory U.S. federal tax rate | 31.55% | 35.00% | 35.00% |
State taxes, net of federal tax effect | 6.90% | 9.70% | 3.10% |
Research and development tax credits | 39.50% | (8.20%) | 13.00% |
Effect of foreign operations | 15.50% | (6.70%) | (18.20%) |
Meals and entertainment | (6.70%) | 2.50% | (3.50%) |
Domestic production activities deduction | 13.80% | (4.00%) | 9.20% |
Change in valuation allowance | (0.20%) | (0.10%) | 0.70% |
Transaction costs | 0.00% | 0.00% | (19.10%) |
2017 tax act | 454.10% | 0.00% | 0.00% |
Foreign withholding | (21.00%) | 3.80% | (6.10%) |
Other permanent differences | (5.80%) | 4.20% | (1.60%) |
Total effective income tax rate | 527.70% | 36.20% | 12.50% |
INCOME TAXES - Summary of Com86
INCOME TAXES - Summary of Components of Net Deferred Tax Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 31, 2017 |
Deferred tax assets: | ||
Accrued expenses | $ 4,068 | $ 4,883 |
Deferred revenue | 12,168 | 8,427 |
Reserves | 3,375 | 6,240 |
Pension and other retiree benefits | 5,307 | 4,978 |
Net operating loss carryforwards | 21,251 | 27,322 |
Tax credit carryforwards | 6,625 | 5,502 |
Share-based compensation | 5,164 | 6,418 |
Other | 418 | 288 |
Total gross deferred tax assets | 58,376 | 64,058 |
Valuation allowance | (3,108) | (3,374) |
Net deferred tax assets | 55,268 | 60,684 |
Deferred tax liabilities: | ||
Intangible assets | (195,959) | (323,008) |
Depreciation | (4,187) | (8,695) |
Total deferred tax liability | $ (144,878) | $ (271,019) |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018USD ($) | Mar. 31, 2018USD ($) | |
Income Tax Disclosure [Abstract] | ||
State net operating loss carryforwards | $ 33 | $ 33 |
Federal net operating loss carryforwards | 66 | 66 |
Tax credit carryforwards | 8 | 8 |
Foreign net operating loss carryforwards | 67 | 67 |
Provisional income tax expense related to transition tax associated with deemed repatriation of foreign earnings | 2 | |
Provisional income tax benefit related to re-measurement of deferred tax assets and liabilities | $ 4 | $ 87 |
INCOME TAXES - Schedule of Reco
INCOME TAXES - Schedule of Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Reconciliation of Unrecognized Tax Benefits [Roll Forward] | |||
Balance at April 1, | $ 2,926 | $ 1,588 | $ 1,038 |
Additions based on tax positions related to the current year | 126 | 46 | 48 |
Release of tax positions of prior years | (481) | (154) | 0 |
Increase in unrecognized tax benefits as a result of a tax position taken during a prior period | 0 | 1,446 | 502 |
Decrease relating to settlements with taxing authorities | (356) | 0 | 0 |
Balance at March 31, | $ 2,215 | $ 2,926 | $ 1,588 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Narrative (Details) | Oct. 13, 2017USD ($) | Mar. 31, 2016patent | Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) |
Commitments and Contingencies Disclosure [Line Items] | |||||
Number of patents allegedly infringed | patent | 5 | ||||
Unconditional purchase obligation | $ 39,900,000 | ||||
Total rent expense under non-cancelable operating leases | 16,600,000 | $ 13,800,000 | $ 12,800,000 | ||
Pre-Suit Damages | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Loss contingency, damages awarded, value | $ 3,500,000 | ||||
Post-Suit Damages | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Loss contingency, damages awarded, value | $ 2,250,000 | ||||
Minimum | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Estimated litigation liability | $ 0 |
COMMITMENTS AND CONTINGENCIES90
COMMITMENTS AND CONTINGENCIES - Schedule of Future Non Cancelable Minimum Lease Commitments (Details) $ in Thousands | Mar. 31, 2018USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2,019 | $ 16,613 |
2,020 | 13,930 |
2,021 | 11,404 |
2,022 | 10,538 |
2,023 | 9,330 |
Remaining years | 37,802 |
Total minimum lease payments | $ 99,617 |
SEGMENT AND GEOGRAPHIC INFORM91
SEGMENT AND GEOGRAPHIC INFORMATION (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | $ 235,224 | $ 268,944 | $ 256,863 | $ 225,756 | $ 318,920 | $ 302,192 | $ 272,048 | $ 268,952 | $ 986,787 | $ 1,162,112 | $ 955,419 |
United States | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | 581,853 | 722,440 | 681,569 | ||||||||
Europe | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | 174,445 | 193,441 | 137,411 | ||||||||
Asia | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | 88,917 | 95,735 | 61,566 | ||||||||
Rest of the world | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | $ 141,572 | $ 150,496 | $ 74,873 |
RELATED PARTY TRANSACTIONS - Na
RELATED PARTY TRANSACTIONS - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Danaher | Affiliated Entity | |||
Related Party Transaction [Line Items] | |||
Revenue | $ 45 | $ 177 | $ 130 |
EMC, Corp. | Member of board of directors | |||
Related Party Transaction [Line Items] | |||
Revenue | 167 | 475 | |
State Street | Member of board of directors | |||
Related Party Transaction [Line Items] | |||
Revenue | 452 | ||
Boston College | Member of board of directors | |||
Related Party Transaction [Line Items] | |||
Revenue | $ 150 | $ 0 | $ 0 |
RELATED PARTY TRANSACTIONS - Sc
RELATED PARTY TRANSACTIONS - Schedule of Related Party Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Receivables from related parties | $ 213,438 | $ 294,374 | |
Related party accounts payable | 30,133 | 37,407 | |
Related party cost of product | 164,526 | 238,002 | $ 238,037 |
Related party cost of service | 107,379 | 108,137 | 90,412 |
Related party research and development | 215,076 | 232,701 | 208,630 |
Related party selling and marketing | 312,536 | 328,628 | 293,335 |
Related party general and administrative expense | 109,479 | 118,438 | 117,714 |
Related party other expense (income) | 3,776 | 1,716 | 1,251 |
Due from related party, operating activities | (443) | (25,055) | 18,483 |
Due to related party | (75) | (2,792) | (6,743) |
Due from related party, investing activities | 0 | 12,864 | 9,306 |
Affiliated Entity | |||
Related Party Transaction [Line Items] | |||
Receivables from related parties | 3,187 | 3,585 | |
Related party accounts payable | 369 | 444 | |
Related party cost of product | 245 | 7,229 | 25,055 |
Related party cost of service | 665 | 745 | 5,736 |
Related party research and development | 3 | 1,624 | 16,701 |
Related party selling and marketing | 2 | 2,423 | 15,430 |
Related party general and administrative expense | 1,703 | 4,099 | 16,055 |
Related party other expense (income) | (56) | (426) | 379 |
Due from related party, operating activities | 443 | 25,055 | (18,483) |
Due to related party | (75) | (2,792) | (6,743) |
Danaher | Affiliated Entity | |||
Related Party Transaction [Line Items] | |||
Receivables from related parties | 252 | 404 | |
Related party accounts payable | 0 | 0 | |
Related party cost of product | 0 | 4,690 | 25,055 |
Related party cost of service | 0 | 485 | 5,736 |
Related party research and development | 0 | 1,720 | 16,701 |
Related party selling and marketing | 2 | 2,273 | 15,430 |
Related party general and administrative expense | 7 | 2,551 | 16,055 |
Related party other expense (income) | 0 | 0 | 379 |
Related party transaction amount | 9 | 11,719 | 79,356 |
Due from related party, operating activities | 96 | 17,310 | (18,483) |
Due to related party | 0 | (2,954) | (6,743) |
Due from related party, investing activities | 0 | 12,864 | 9,306 |
Fortive | Affiliated Entity | |||
Related Party Transaction [Line Items] | |||
Receivables from related parties | 2,935 | 3,181 | |
Related party accounts payable | 369 | 444 | |
Related party cost of product | 245 | 2,539 | 0 |
Related party cost of service | 665 | 260 | 0 |
Related party research and development | 3 | (96) | 0 |
Related party selling and marketing | 0 | 150 | 0 |
Related party general and administrative expense | 1,696 | 1,548 | 0 |
Related party other expense (income) | (56) | (426) | 0 |
Related party transaction amount | 2,553 | 3,975 | 0 |
Due from related party, operating activities | 347 | 7,745 | 0 |
Due to related party | $ (75) | $ 162 | $ 0 |
QUARTERLY RESULTS OF OPERATIO94
QUARTERLY RESULTS OF OPERATIONS - UNAUDITED (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 235,224 | $ 268,944 | $ 256,863 | $ 225,756 | $ 318,920 | $ 302,192 | $ 272,048 | $ 268,952 | $ 986,787 | $ 1,162,112 | $ 955,419 |
Gross profit | 168,633 | 204,435 | 182,620 | 159,194 | 226,003 | 220,514 | 187,538 | 181,918 | 714,882 | 815,973 | 626,970 |
Net income (loss) | $ 16,817 | $ 89,685 | $ (2,468) | $ (24,222) | $ 22,310 | $ 21,245 | $ (1,266) | $ (8,998) | $ 79,812 | $ 33,291 | $ (28,369) |
Diluted net income (loss) per share (in dollars per share) | $ 0.20 | $ 1.02 | $ (0.03) | $ (0.27) | $ 0.24 | $ 0.23 | $ (0.01) | $ (0.10) | $ 0.90 | $ 0.36 | $ (0.35) |
SCHEDULE II - VALUATION AND Q95
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Allowance for doubtful accounts | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Year | $ 2,066 | $ 5,069 | $ 173 |
Additions Resulting in Charges to Operations | 695 | 6,961 | 1,824 |
Charges to Other Accounts | (346) | (7,580) | 3,221 |
Deductions Due to Write-Offs | (424) | (2,384) | (149) |
Balance at End of Year | 1,991 | 2,066 | 5,069 |
Deferred tax asset valuation allowance | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Year | 3,374 | 3,777 | 3,906 |
Additions Resulting in Charges to Operations | 0 | (338) | 99 |
Charges to Other Accounts | 0 | (65) | 0 |
Deductions Due to Write-Offs | (266) | 0 | (228) |
Balance at End of Year | $ 3,108 | $ 3,374 | $ 3,777 |