Bowflex (BFXXQ) 10-Q 7 Nov 13 2013 Q3 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	9 Months Ended
	Sep. 30, 2013	Oct. 31, 2013
Document and Entity Information [Abstract]	'	'
Entity Registrant Name	'NAUTILUS, INC.	'
Entity Central Index Key	'0001078207	'
Current Fiscal Year End Date	'--12-31	'
Entity Filer Category	'Accelerated Filer	'
Document Type	'10-Q	'
Document Period End Date	30-Sep-13	'
Document Fiscal Year Focus	'2013	'
Document Fiscal Period Focus	'Q3	'
Amendment Flag	'false	'
Entity Common Stock, Shares Outstanding	'	31,152,656

Condensed_Consolidated_Balance

Condensed Consolidated Balance Sheets (Unaudited) (USD $)	Sep. 30, 2013	Dec. 31, 2012
In Thousands, unless otherwise specified
Current assets:	'	'
Cash and cash equivalents	$27,694	$23,207
Trade receivables, net of allowances of $34 and $93	17,125	21,767
Inventories	17,521	18,787
Prepaids and other current assets	4,759	5,750
Income taxes receivable	127	101
Short-term notes receivable	0	82
Deferred income tax assets	3,666	193
Total current assets	70,892	69,887
Property, plant and equipment, net	8,095	6,138
Goodwill	2,842	2,940
Other intangible assets, net	13,128	14,666
Long-term deferred income tax assets	27,955	239
Other assets	415	441
Total assets	123,327	94,311
Liabilities and Stockholders' Equity	'	'
Trade payables	27,019	32,753
Accrued liabilities	6,881	8,171
Warranty obligations, current portion	1,813	2,278
Deferred income tax liabilities	0	1,275
Total current liabilities	35,713	44,477
Warranty obligations, non-current	28	214
Income taxes payable, non-current	2,813	2,812
Deferred income tax liabilities, non-current	0	1,484
Other long-term liabilities	1,614	1,998
Total liabilities	40,168	50,985
Commitments and contingencies (Note 11)	'	'
Stockholders' equity:	'	'
Common stock - no par value, 75,000 shares authorized, 31,148 and 30,924 shares issued and outstanding	6,750	6,103
Retained earnings	76,004	36,598
Accumulated other comprehensive income	405	625
Total stockholders' equity	83,159	43,326
Total liabilities and stockholders' equity	$123,327	$94,311

Condensed_Consolidated_Balance1

Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) (USD $)	Sep. 30, 2013	Dec. 31, 2012
In Thousands, except Share data, unless otherwise specified
Statement of Financial Position [Abstract]	'	'
Allowance for doubtful trade receivables	$34	$93
Common stock, par value (in dollars per share)	$0	$0
Common stock, shares authorized	75,000,000	75,000,000
Common stock, shares issued	31,148,000	30,924,000
Common stock, shares outstanding	31,148,000	30,924,000

Condensed_Consolidated_Stateme

Condensed Consolidated Statements of Operations (Unaudited) (USD $)	3 Months Ended				9 Months Ended
In Thousands, except Per Share data, unless otherwise specified	Sep. 30, 2013		Sep. 30, 2012		Sep. 30, 2013		Sep. 30, 2012
Income Statement [Abstract]	'		'		'		'
Net sales	$46,256		$38,052		$141,712		$128,897
Cost of sales	24,479		19,511		71,912		69,283
Gross profit	21,777		18,541		69,800		59,614
Operating expenses:	'		'		'		'
Selling and marketing	14,152		12,434		46,546		41,057
General and administrative	4,907		4,371		13,836		12,672
Research and development	1,382		1,038		3,812		2,957
Total operating expenses	20,441		17,843		64,194		56,686
Operating income	1,336		698		5,606		2,928
Other income (expense):	'		'		'		'
Interest income	4		3		5		16
Interest expense	-10		-9		-25		66
Other	271		-101		292		-187
Total other income (expense)	265		-107		272		-105
Income from continuing operations before income taxes	1,601		591		5,878		2,823
Income tax provision (benefit)	101		-625		-33,814		-554
Income from continuing operations	1,500		1,216		39,692		3,377
Discontinued operation:	'		'		'		'
Loss from discontinued operation before income taxes	-106		-281		-367		-167
Income tax provision (benefit) of discontinued operation	10		-16		-81		-99
Loss from discontinued operation	-116		-265		-286		-68
Net income	$1,384		$951		$39,406		$3,309
Earnings Per Share, Basic [Abstract]	'		'		'		'
Basic income per share from continuing operations (in dollars per share)	$0.05		$0.04		$1.28		$0.11
Basic loss per share from discontinued operation (in dollars per share)	$0		($0.01)		($0.01)		$0
Basic net income per share (in dollars per share)	$0.04	[1]	$0.03	[1]	$1.27	[1]	$0.11	[1]
Earnings Per Share, Diluted [Abstract]	'		'		'		'
Diluted income per share from continuing operations (in dollars per share)	$0.05		$0.04		$1.26		$0.11
Diluted loss per share from discontinued operation (in dollars per share)	$0		($0.01)		($0.01)		$0
Diluted net income per share (in dollars per share)	$0.04	[1]	$0.03	[1]	$1.25	[1]	$0.11	[1]
Shares used in per share calculations:	'		'		'		'
Basic (in shares)	31,128		30,892		31,045		30,892
Diluted (in shares)	31,488		30,943		31,419		31,010
[1]	May not add due to rounding

Condensed_Consolidated_Stateme1

Condensed Consolidated Statements of Comprehensive Income (Unaudited) (USD $)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Statement of Other Comprehensive Income [Abstract]	'	'	'	'
Net income	$1,384	$951	$39,406	$3,309
Other comprehensive income (loss):	'	'	'	'
Foreign currency translation, net of income tax expense (benefit) of $(7), $(13), $14 and $(13)	112	54	-220	-21
Comprehensive income	$1,496	$1,005	$39,186	$3,288

Condensed_Consolidated_Stateme2

Condensed Consolidated Statements of Comprehensive Income (Unaudited) (Parentheticals) (USD $)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Statement of Other Comprehensive Income [Abstract]	'	'	'	'
Foreign currency translation, net of income tax expense (benefit) of	($7)	($13)	$14	($13)

Condensed_Consolidated_Stateme3

Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $)	9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012
Cash flows from operating activities:	'	'
Income from continuing operations	$39,692	$3,377
Loss from discontinued operation	-286	-68
Net income	39,406	3,309
Adjustments to reconcile net income to cash provided by operating activities:	'	'
Depreciation and amortization	2,481	2,406
Bad debt expense (reduction)	510	-16
Stock-based compensation expense	292	453
Reduction of previously estimated asset disposal loss	0	-86
Loss on asset dispositions	9	14
Deferred income taxes, net of valuation allowance	-34,156	333
Changes in operating assets and liabilities:	'	'
Trade receivables, net	4,048	12,024
Inventories	1,259	-5,278
Prepaids and other current assets	998	-41
Income taxes	-183	-169
Trade payables	-5,719	-7,459
Accrued liabilities, including warranty obligations	-1,999	-1,223
Net cash provided by operating activities	6,946	4,267
Cash flows from investing activities:	'	'
Proceeds from sale of assets of discontinued operation	113	310
Purchases of software and equipment	-2,847	-1,742
Net cash used in investing activities	-2,734	-1,432
Cash flows from financing activities:	'	'
Repayment of long-term borrowings	0	-5,000
Proceeds from exercise of stock options	355	89
Net cash provided by (used in) financing activities	355	-4,911
Effect of exchange rate changes on cash and cash equivalents	-80	-142
Increase (decrease) in cash and cash equivalents	4,487	-2,218
Cash and cash equivalents:	'	'
Beginning of period	23,207	17,427
End of period	27,694	15,209
Supplemental disclosure of cash flow information:	'	'
Cash paid for interest	25	533
Cash paid (refunded) for income taxes, net	$246	($97)

General_Information

General Information	9 Months Ended
	Sep. 30, 2013
Organization, Consolidation and Presentation of Financial Statements [Abstract]	'
General Information	'
	GENERAL INFORMATION
	Basis of Consolidation and Presentation
	The accompanying condensed consolidated financial statements present the financial position, results of operations and cash flows of Nautilus, Inc. and its subsidiaries, all of which are wholly owned. Intercompany transactions and balances have been eliminated in consolidation.
	The accompanying condensed consolidated financial statements have not been audited. We have condensed or omitted certain information and footnote disclosures normally included in financial statements presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management believes the disclosures contained herein are adequate to make the information presented not misleading. However, these condensed consolidated financial statements should be read in conjunction with our consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2012 (the “2012 Form 10-K”).
	The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Further information regarding significant estimates can be found in our 2012 Form 10-K.
	In the opinion of management, the accompanying condensed consolidated financial statements reflect all adjustments necessary to present fairly our financial position as of September 30, 2013 and December 31, 2012 and our results of operations and comprehensive income for the three and nine months ended September 30, 2013 and 2012 and our cash flows for the nine months ended September 30, 2013 and 2012. Interim results are not necessarily indicative of results for a full year. Our revenues typically vary seasonally and this seasonality can have a significant effect on operating results, inventory levels and working capital needs.
	Unless indicated otherwise, all information regarding our operating results pertain to our continuing operations.
	New Accounting Pronouncements
	ASU 2012-02
	In July 2012, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2012-02, “Intangibles - Goodwill and Other: Testing Indefinite-Lived Intangible Assets for Impairment,” which permits an entity to make a qualitative assessment to determine whether it is more likely than not that an indefinite-lived intangible asset, other than goodwill, is impaired. Entities are required to test indefinite-lived intangible assets for impairment at least annually and more frequently if indicators of impairment exist. If an entity concludes, based on an evaluation of all relevant qualitative factors, that it is not more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount, it is not required to perform the quantitative impairment test for that asset. Because the qualitative assessment is optional, an entity is permitted to bypass it for any indefinite-lived intangible asset in any period and apply the quantitative test. ASU 2012-02 also permits the entity to resume performing the qualitative assessment in any subsequent period. ASU 2012-02 is effective for impairment tests performed for fiscal years beginning after September 15, 2012 and early adoption is permitted. The adoption of ASU 2012-02 in January 2013 did not have any impact on our financial position, results of operations or cash flows.
	ASU 2013-02
	In February 2013, the FASB issued ASU No. 2013-02, “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.” Under ASU 2013-02, an entity is required to provide information about the amounts reclassified out of Accumulated Other Comprehensive Income (“AOCI”) by component. In addition, an entity is required to present, either on the face of the financial statements or in the notes, significant amounts reclassified out of AOCI by the respective line items of net income, but only if the amount reclassified is required to be reclassified in its entirety in the same reporting period. For amounts that are not required to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional details about those amounts. The adoption of ASU 2013-02 in January 2013 did not have any impact on our financial position, results of operations or cash flows.
	ASU 2013-11
	In July 2013, the FASB issued ASU No. 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” ASU 2013-11 amends the guidance related to the presentation of unrecognized tax benefits and allows for the reduction of a deferred tax asset for a net operating loss (“NOL”) carryforward whenever the NOL or tax credit carryforward would be available to reduce the additional taxable income or tax due if the tax position is disallowed. ASU 2013-11 is effective for annual and interim periods for fiscal years beginning after December 15, 2013, and early adoption is permitted. Since ASU 2013-11 relates only to the presentation of unrecognized tax benefits, we do not expect our adoption of ASU 2013-11 in January 2014 will have a material effect on our financial position, results of operations or cash flows.

Discontinued_Operation

Discontinued Operation	9 Months Ended
	Sep. 30, 2013
Discontinued Operations and Disposal Groups [Abstract]	'
Discontinued Operation	'
	DISCONTINUED OPERATION
	On September 25, 2009, in light of continuing operating losses in our Commercial business and in order to focus exclusively on managing our Direct and Retail businesses, we committed to a plan for the complete divestiture of our Commercial business, which qualified for held-for-sale accounting treatment. The Commercial business is presented as a Discontinued Operation in our Condensed Consolidated Statements of Operations for all periods.
	The disposal of the Commercial business assets was completed in April 2011. We reached substantial completion of asset liquidation at December 2012. However, we continue to have legal and accounting expenses as we work with authorities on final deregistration of certain European entities and product liability expenses associated with product previously sold into the Commercial channel. There was no revenue related to the Commercial business for the year ended December 31, 2012 or the nine-month period ended September 30, 2013.
	The following table summarizes liabilities for exit costs related to the discontinued operation, included in Accrued Liabilities and Other Long-Term Liabilities in our Condensed Consolidated Balance Sheets (in thousands):
		Facilities
		Leases
	Balance as of December 31, 2012	$	1,118
	Adjustments	—
	Payments	(221		)
	Balance as of September 30, 2013	$	897
	We expect the lease obligations to be paid out through 2016.

Inventories

Inventories	9 Months Ended
	Sep. 30, 2013
Inventory Disclosure [Abstract]	'
Inventories	'
	INVENTORIES
	Inventories are stated at the lower of cost or market, with cost determined based on the first-in, first-out method. We establish inventory allowances for excess, slow-moving and obsolete inventory based on inventory levels, expected product life and forecasted sales. Inventories are written down to market value based on historical demand, competitive factors, changes in technology and product life cycles.
	Net Inventories consisted of the following (in thousands):
		As of
		September 30, 2013		December 31, 2012
	Finished goods	$	15,918	$	17,148
	Parts and components	1,603		1,639
	Total inventories	$	17,521	$	18,787
	Inventory reserves, primarily related to excess parts inventories, were as follows (in thousands):
		As of
		30-Sep-13		31-Dec-12
	Inventory reserves	$	683	$	1,011

Property_Plant_and_Equipment

Property, Plant and Equipment	9 Months Ended
	Sep. 30, 2013
Property, Plant and Equipment [Abstract]	'
Property, Plant and Equipment	'
	PROPERTY, PLANT AND EQUIPMENT
	Property, Plant and Equipment consisted of the following (in thousands):
		Estimated	As of
		Useful Life
		(in years)	September 30, 2013			December 31, 2012
	Leasehold improvements	5 to 20	$	2,917		$	2,863
	Computer equipment	3 to 5	36,505			36,107
	Machinery and equipment	3 to 5	5,164			5,359
	Furniture and fixtures	5	690			870
	Work in progress 1	N/A	4,232			2,080
	Total cost		49,508			47,279
	Accumulated depreciation		(41,413		)	(41,141		)
	Total property, plant and equipment, net		$	8,095		$	6,138
	1 Work in progress includes internal use software development and production tooling construction in progress.

Goodwill_and_Other_Intangible_

Goodwill and Other Intangible Assets	9 Months Ended
	Sep. 30, 2013
Goodwill and Intangible Assets Disclosure [Abstract]	'
Goodwill and Other Intangible Assets	'
	GOODWILL AND OTHER INTANGIBLE ASSETS
	Goodwill
	The rollforward of Goodwill was as follows (in thousands):
	Balance, December 31, 2011	$	2,873
	Currency exchange rate adjustment	67
	Balance, December 31, 2012	2,940
	Currency exchange rate adjustment	(98		)
	Balance, September 30, 2013	$	2,842
	Other Intangible Assets
	Other Intangible Assets consisted of the following (in thousands):
		Estimated		As of
		Useful Life
		(in years)		September 30, 2013				December 31, 2012
	Other intangible assets:
	Indefinite-lived trademarks	N/A		$	9,052			$	9,052
	Patents	8 to 16		18,154				18,154
				27,206				27,206
	Accumulated amortization - patents			(14,078		)		(12,540		)
				$	13,128			$	14,666
	Amortization expense was as follows (in thousands):
		Three Months Ended September 30,								Nine Months Ended September 30,
		2013				2012				2013		2012
	Patent amortization	$	513			$	513			$	1,538	$	1,538
	Future amortization of patents is as follows (in thousands):
	Remainder of 2013	$	513
	2014	2,040
	2015	828
	2016	430
	2017	143
	Thereafter	122
		$	4,076

Accrued_Liabilities

Accrued Liabilities	9 Months Ended
	Sep. 30, 2013
Payables and Accruals [Abstract]	'
Accrued Liabilities	'
	ACCRUED LIABILITIES
	Accrued Liabilities consisted of the following (in thousands):
		As of
		30-Sep-13		31-Dec-12
	Exit costs of discontinued operations	$	300	$	340
	Payroll and related liabilities	3,320		3,327
	Royalties	753		1,063
	Legal and professional fees	153		834
	Other	2,355		2,607
	Total accrued liabilities	$	6,881	$	8,171

Product_Warranties

Product Warranties	9 Months Ended
	Sep. 30, 2013
Product Warranties Disclosures [Abstract]	'
Product Warranties	'
	PRODUCT WARRANTIES
	Our products carry limited, defined warranties for defects in materials or workmanship which, according to their terms, generally obligate us to pay the costs of supplying and shipping replacement parts to customers and, in certain instances, pay for labor and other costs to service products. Outstanding product warranty periods range from sixty days to, in limited circumstances, the lifetime of certain product components. We record a liability at the time of sale for the estimated costs of fulfilling future warranty claims. If necessary, we adjust the liability for specific warranty-related matters when they become known and are reasonably estimable. Estimated warranty expense is included in Cost of Sales, based on historical warranty claim experience and available product quality data. Warranty expense is affected by the performance of new products, significant manufacturing or design defects not discovered until after the product is delivered to the customer, product failure rates, and higher or lower than expected repair costs. If warranty expense differs from previous estimates, or if circumstances change such that the assumptions inherent in previous estimates are no longer valid, the amount of product Warranty Obligations is adjusted accordingly.
	Changes in our product Warranty Obligations were as follows (in thousands):
		Nine months ended September 30,
		2013			2012
	Balance, beginning of period	$	2,492		$	2,017
	Payments	(1,416		)	(1,428		)
	Adjustments	(186		)	(171		)
	Accruals	951			1,645
	Balance, end of period	$	1,841		$	2,063

Income_Tax_Provision_Benefit

Income Tax Provision (Benefit)	9 Months Ended
	Sep. 30, 2013
Income Tax Disclosure [Abstract]	'
Income Tax Provision (Benefit)	'
	INCOME TAX PROVISION (BENEFIT)
	In the second quarter of 2013, we evaluated the potential realization of our Deferred Income Tax Assets, considering both positive and negative evidence, including cumulative income or loss for the past three years and forecasted taxable income. As a result of this evaluation we concluded that, as of June 30, 2013, a majority of the existing valuation allowance on our domestic Deferred Income Tax Assets was no longer required. As of September 30, 2013, we maintain the same position as the previous quarter that the partial release of valuation allowance is still appropriate. Accordingly, an income tax benefit of $36.3 million was recorded during the nine-month period ended September 30, 2013 related to the reduction of our existing valuation allowance.
	Evaluating the need for, and amount of, a valuation allowance for deferred tax assets often requires significant judgment and extensive analysis of all available evidence on a jurisdiction-by-jurisdiction basis. Such judgments require us to interpret existing tax law and other published guidance as applied to our circumstances. As part of this assessment, we consider both positive and negative evidence. The weight given to the potential effect of positive and negative evidence must be commensurate with the extent to which the strength of the evidence can be objectively verified. We generally consider the following, but are not limited to, objectively verified evidence to determine the likelihood of realization of the deferred tax assets:
	•	Our current financial position and our historical results of operations for recent years. We generally consider cumulative pre-tax losses in the three-year period ending with the current quarter to be significant negative evidence regarding our future profitability. A pattern of objectively-measured recent financial reporting losses is heavily weighted as a source of negative evidence. Further, we also consider the historical and current financial trends in the recent years.
	•	Sources of taxable income of the appropriate character. Future realization of deferred tax assets is dependent on projected taxable income of the appropriate character from our continuing operations. Future reversals of existing temporary differences are heavily-weighted sources of objectively verifiable positive evidence. Projections of future taxable income exclusive of reversing temporary differences are a source of positive evidence only when the projections are combined with a history of recent profits and current financial trends and can be reasonably estimated.
	•	Carryback and carryforward periods available. The long carryback and carryforward periods permitted under the tax law are objectively verified positive evidence.
	•	Tax planning strategies. Tax planning strategies can be, depending on their nature, heavily-weighted sources of objectively verifiable positive evidence when the strategies are available and can be reasonably executed. We consider tax planning strategies only if they are feasible and justifiable considering our current operations and our strategic plan. Tax planning strategies, if executed, may accelerate the recovery of a deferred tax asset so the tax benefit of the deferred tax asset can be carried back.
	During 2008, we determined that it was no longer more likely than not that the tax benefits from the existing U.S. deferred tax assets would be realized due to the substantial amount of the cumulative accounting losses realized in the recent years in the U.S. and the large taxable losses incurred in the U.S. in 2007 and 2008. Accordingly, we established a full valuation allowance against our U.S. net deferred tax assets in 2008.
	Each quarter, we assess the total weight of positive and negative evidence and re-evaluate whether any adjustments or release of all or any portion of valuation allowance is appropriate. In our assessment during the second quarter of 2013, we heavily weighted the positive evidence of 1) cumulative profits realized in recent years combined with the upward financial trends of current periods; and 2) future realization of the existing U.S. deferred tax assets. Given our recent improved financial performance, which includes a sustained cumulative accounting profit through 2013, we are projecting a positive forecasted taxable income in 2013 in the U.S. Accordingly, based on our review of the objective evidence and our detailed analysis during the second quarter of 2013, we determined that a portion of our U.S. domestic valuation allowance was no longer required.
	The remaining domestic valuation allowance of $8.5 million at September 30, 2013 relates to certain domestic loss carryforwards and other credits that we may not be able to utilize primarily due to their shorter remaining carryforward periods. Should it be determined in the future that it is more likely than not that our Deferred Income Tax Assets will be realized, an additional valuation allowance would be released during the period in which such an assessment is made.
	Further, there have been no material changes to our foreign operations since December 31, 2012 and, accordingly, we maintain our existing valuation allowance on foreign Deferred Income Tax Assets in such jurisdictions at September 30, 2013.

Income_Per_Share

Income Per Share	9 Months Ended
	Sep. 30, 2013
Earnings Per Share [Abstract]	'
Income Per Share	'
	INCOME PER SHARE
	Basic Income Per Share was computed using the weighted average number of common shares outstanding. For the computation of Diluted Income Per Share, the number of basic weighted average shares outstanding was increased by dilutive potential common shares related to stock-based awards, as determined by the treasury stock method. The weighted average numbers of shares outstanding used to compute Income Per Share were as follows (in thousands):
		Three months ended September 30,		Nine months ended September 30,
		2013	2012	2013	2012
	Shares used to calculate basic income per share	31,128	30,892	31,045	30,892
	Dilutive effect of outstanding options and performance stock units	360	51	374	118
	Shares used to calculate diluted income per share	31,488	30,943	31,419	31,010
	The weighted average numbers of shares outstanding listed in the table below were anti-dilutive and excluded from the computation of Diluted Income Per Share, primarily because the average market price did not exceed the exercise price. These shares may be dilutive potential common shares in the future (in thousands):
		Three months ended September 30,		Nine months ended September 30,
		2013	2012	2013	2012
	Stock options	298	1,115	303	1,072
	Performance stock units	84	130	17	47

Segment_Information

Segment Information	9 Months Ended
	Sep. 30, 2013
Segment Reporting [Abstract]	'
Segment Information	'
	SEGMENT INFORMATION
	We have two reportable segments - Direct and Retail. Contribution is the measure of profit or loss, defined as net sales less product costs and directly attributable expenses. Directly attributable expenses include Selling and Marketing expenses, General and Administrative expenses, and Research and Development expenses that are directly related to segment operations. Segment assets are those directly assigned to an operating segment's operations, primarily Accounts Receivable, Inventories and Intangible Assets. Unallocated assets primarily include shared information technology infrastructure, distribution centers, corporate headquarters, Prepaids and Other Current Assets, Deferred Income Tax Assets and Other Assets. Capital expenditures directly attributable to the Direct and Retail segments were not significant in any period.
	Following is summary information by reportable segment (in thousands):
		Three months ended September 30,						Nine months ended September 30,
		2013			2012			2013			2012
	Net sales:
	Direct	$	25,729		$	25,103		$	93,678		$	83,544
	Retail	19,369			11,388			44,678			42,057
	Unallocated royalty income	1,158			1,561			3,356			3,296
	Consolidated net sales	$	46,256		$	38,052		$	141,712		$	128,897
	Contribution:
	Direct	$	1,316		$	1,947		$	8,533		$	5,968
	Retail	2,875			827			4,975			4,182
	Unallocated royalty income	1,158			1,561			3,356			3,296
	Consolidated contribution	$	5,349		$	4,335		$	16,864		$	13,446
	Reconciliation of consolidated contribution to income
	from continuing operations:
	Consolidated contribution	$	5,349		$	4,335		$	16,864		$	13,446
	Amounts not directly related to segments:
	Operating expenses	(4,013		)	(3,637		)	(11,258		)	(10,518		)
	Other income (expense), net	265			(107		)	272			(105		)
	Income tax (expense) benefit	(101		)	625			33,814			554
	Income from continuing operations	$	1,500		$	1,216		$	39,692		$	3,377
	There was no material change in the allocation of assets by segment during the first nine months of 2013 and, accordingly, assets by segment are not presented.

Commitments_and_Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2013
Commitments and Contingencies Disclosure [Abstract]	'
Commitments and Contingencies	'
	COMMITMENTS AND CONTINGENCIES
	Guarantees, Commitments and Off-Balance Sheet Arrangements
	As of September 30, 2013, we had approximately $0.6 million in standby letters of credit with certain vendors with expiration dates through August 2014.
	We have long lead times for inventory purchases and, therefore, must secure factory capacity from our vendors in advance. As of September 30, 2013, we had approximately $9.3 million in non-cancelable market-based purchase obligations, primarily for inventory purchases expected to be received within the next twelve months. Purchase obligations can vary from quarter-to-quarter and versus the same period in prior years due to a number of factors, including the amount of products that are shipped directly to Retail customer warehouses versus through Nautilus warehouses.
	In the ordinary course of business, we enter into agreements that require us to indemnify counterparties against third-party claims. These may include: agreements with vendors and suppliers, under which we may indemnify them against claims arising from use of their products or services; agreements with customers, under which we may indemnify them against claims arising from their use or sale of our products; real estate and equipment leases, under which we may indemnify lessors against third-party claims relating to the use of their property; agreements with licensees or licensors, under which we may indemnify the licensee or licensor against claims arising from their use of our intellectual property or our use of their intellectual property; and agreements with parties to debt arrangements, under which we may indemnify them against claims relating to their participation in the transactions.
	The nature and terms of these indemnification obligations vary from contract to contract, and generally a maximum obligation is not stated within the agreements. We hold insurance policies that mitigate potential losses arising from certain types of indemnification obligations. Management does not deem these obligations to be significant to our financial position, results of operations or cash flows and, therefore, no related liabilities were recorded as of September 30, 2013.
	Legal and Tax Matters
	From time to time, we may be involved in various claims, lawsuits and other proceedings. These legal and tax proceedings involve uncertainty as to the eventual outcomes and losses which may be realized when one or more future events occur or fail to occur. We record expenses for litigation and loss contingencies when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. When a loss contingency is not both probable and estimable, we do not establish an accrued liability. However, if the loss (or an additional loss in excess of the accrual) is at least a reasonable possibility and material, then we disclose an estimate of the possible loss or range of loss, if such estimate can be made, or disclose that an estimate cannot be made.
	Litigation and jury verdicts are, to some degree, inherently unpredictable, and although we have determined that a loss is not probable in connection with any legal proceeding, it is reasonably possible that a loss may be incurred in connection with proceedings to which we are a party. Assessment of whether incurrence of a loss is probable, or a reasonable possibility, in connection with a particular proceeding, and estimation of the loss, or a range of loss, involves complex judgments and numerous uncertainties. Management is unable to estimate a range of reasonably possible losses related to litigation in its early stages, especially when the damages sought are indeterminate, or the legal and factual basis for the relevant claims have not been developed with specificity.
	We regularly monitor our estimated exposure to these contingencies and, as additional information becomes known, may change our estimates accordingly. We evaluate, on a quarterly basis, developments in legal proceedings, investigations or claims that could affect the amount of any accrual, as well as any developments that would make a loss probable or reasonably possible, and whether the amount of a probable or reasonably possible loss is estimable. Among other factors, we evaluate the advice of internal and external counsel, the outcomes from similar litigation, current status of the lawsuits (including settlement initiatives), legislative developments and other factors. Due to the numerous variables associated with these judgments and assumptions, both the precision and reliability of the resulting estimates of the related loss contingencies are subject to substantial uncertainties.

Discontinued_Operation_Tables

Discontinued Operation (Tables)	9 Months Ended
	Sep. 30, 2013
Discontinued Operations and Disposal Groups [Abstract]	'
Schedule of Operating Results of Company's Former Commercial Business	'
	The following table summarizes liabilities for exit costs related to the discontinued operation, included in Accrued Liabilities and Other Long-Term Liabilities in our Condensed Consolidated Balance Sheets (in thousands):
		Facilities
		Leases
	Balance as of December 31, 2012	$	1,118
	Adjustments	—
	Payments	(221		)
	Balance as of September 30, 2013	$	897

Inventories_Tables

Inventories (Tables)	9 Months Ended
	Sep. 30, 2013
Inventory Disclosure [Abstract]	'
Schedule of Inventories, Net of Valuation Allowances	'
	Net Inventories consisted of the following (in thousands):
		As of
		September 30, 2013		December 31, 2012
	Finished goods	$	15,918	$	17,148
	Parts and components	1,603		1,639
	Total inventories	$	17,521	$	18,787
Inventory Valuation Reserves	'
	Inventory reserves, primarily related to excess parts inventories, were as follows (in thousands):
		As of
		30-Sep-13		31-Dec-12
	Inventory reserves	$	683	$	1,011

Property_Plant_and_Equipment_T

Property, Plant, and Equipment (Tables)	9 Months Ended
	Sep. 30, 2013
Property, Plant and Equipment [Abstract]	'
Schedule of Property, Plant and Equipment	'
	Property, Plant and Equipment consisted of the following (in thousands):
		Estimated	As of
		Useful Life
		(in years)	September 30, 2013			December 31, 2012
	Leasehold improvements	5 to 20	$	2,917		$	2,863
	Computer equipment	3 to 5	36,505			36,107
	Machinery and equipment	3 to 5	5,164			5,359
	Furniture and fixtures	5	690			870
	Work in progress 1	N/A	4,232			2,080
	Total cost		49,508			47,279
	Accumulated depreciation		(41,413		)	(41,141		)
	Total property, plant and equipment, net		$	8,095		$	6,138
	1 Work in progress includes internal use software development and production tooling construction in progress.

Goodwill_and_Other_Intangible_1

Goodwill and Other Intangible Assets (Tables)	9 Months Ended
	Sep. 30, 2013
Goodwill and Intangible Assets Disclosure [Abstract]	'
Schedule of Goodwill and Other Intangible Assets	'
	The rollforward of Goodwill was as follows (in thousands):
	Balance, December 31, 2011	$	2,873
	Currency exchange rate adjustment	67
	Balance, December 31, 2012	2,940
	Currency exchange rate adjustment	(98		)
	Balance, September 30, 2013	$	2,842
	Other Intangible Assets
	Other Intangible Assets consisted of the following (in thousands):
		Estimated		As of
		Useful Life
		(in years)		September 30, 2013				December 31, 2012
	Other intangible assets:
	Indefinite-lived trademarks	N/A		$	9,052			$	9,052
	Patents	8 to 16		18,154				18,154
				27,206				27,206
	Accumulated amortization - patents			(14,078		)		(12,540		)
				$	13,128			$	14,666
Amortization Expense	'
	Amortization expense was as follows (in thousands):
		Three Months Ended September 30,								Nine Months Ended September 30,
		2013				2012				2013		2012
	Patent amortization	$	513			$	513			$	1,538	$	1,538
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense	'
	Future amortization of patents is as follows (in thousands):
	Remainder of 2013	$	513
	2014	2,040
	2015	828
	2016	430
	2017	143
	Thereafter	122
		$	4,076

Accrued_Liabilities_Tables

Accrued Liabilities (Tables)	9 Months Ended
	Sep. 30, 2013
Payables and Accruals [Abstract]	'
Schedule of Accrued Liabilities	'
	Accrued Liabilities consisted of the following (in thousands):
		As of
		30-Sep-13		31-Dec-12
	Exit costs of discontinued operations	$	300	$	340
	Payroll and related liabilities	3,320		3,327
	Royalties	753		1,063
	Legal and professional fees	153		834
	Other	2,355		2,607
	Total accrued liabilities	$	6,881	$	8,171

Product_Warranties_Tables

Product Warranties (Tables)	9 Months Ended
	Sep. 30, 2013
Product Warranties Disclosures [Abstract]	'
Schedule of Product Warranty Liability	'
	Changes in our product Warranty Obligations were as follows (in thousands):
		Nine months ended September 30,
		2013			2012
	Balance, beginning of period	$	2,492		$	2,017
	Payments	(1,416		)	(1,428		)
	Adjustments	(186		)	(171		)
	Accruals	951			1,645
	Balance, end of period	$	1,841		$	2,063

Income_Per_Share_Tables

Income Per Share (Tables)	9 Months Ended
	Sep. 30, 2013
Earnings Per Share [Abstract]	'
Schedule of Weighted Average Number of Shares Outstanding Used to Compute Income Per Share	'
	The weighted average numbers of shares outstanding used to compute Income Per Share were as follows (in thousands):
		Three months ended September 30,		Nine months ended September 30,
		2013	2012	2013	2012
	Shares used to calculate basic income per share	31,128	30,892	31,045	30,892
	Dilutive effect of outstanding options and performance stock units	360	51	374	118
	Shares used to calculate diluted income per share	31,488	30,943	31,419	31,010
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	'
	The weighted average numbers of shares outstanding listed in the table below were anti-dilutive and excluded from the computation of Diluted Income Per Share, primarily because the average market price did not exceed the exercise price. These shares may be dilutive potential common shares in the future (in thousands):
		Three months ended September 30,		Nine months ended September 30,
		2013	2012	2013	2012
	Stock options	298	1,115	303	1,072
	Performance stock units	84	130	17	47

Segment_Information_Tables

Segment Information (Tables)	9 Months Ended
	Sep. 30, 2013
Segment Reporting [Abstract]	'
Summary Information by Reportable Segments	'
	Following is summary information by reportable segment (in thousands):
		Three months ended September 30,						Nine months ended September 30,
		2013			2012			2013			2012
	Net sales:
	Direct	$	25,729		$	25,103		$	93,678		$	83,544
	Retail	19,369			11,388			44,678			42,057
	Unallocated royalty income	1,158			1,561			3,356			3,296
	Consolidated net sales	$	46,256		$	38,052		$	141,712		$	128,897
	Contribution:
	Direct	$	1,316		$	1,947		$	8,533		$	5,968
	Retail	2,875			827			4,975			4,182
	Unallocated royalty income	1,158			1,561			3,356			3,296
	Consolidated contribution	$	5,349		$	4,335		$	16,864		$	13,446
	Reconciliation of consolidated contribution to income
	from continuing operations:
	Consolidated contribution	$	5,349		$	4,335		$	16,864		$	13,446
	Amounts not directly related to segments:
	Operating expenses	(4,013		)	(3,637		)	(11,258		)	(10,518		)
	Other income (expense), net	265			(107		)	272			(105		)
	Income tax (expense) benefit	(101		)	625			33,814			554
	Income from continuing operations	$	1,500		$	1,216		$	39,692		$	3,377

Discontinued_Operation_Details

Discontinued Operation (Details) (Facilities Leases, USD $)	9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013
Facilities Leases	'
Restructuring Reserve [Roll Forward]	'
Balance as of December 31, 2012	$1,118
Adjustments	0
Payments	-221
Balance as of September 30, 2013	$897

Inventories_Details

Inventories (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
In Thousands, unless otherwise specified
Inventory Disclosure [Abstract]	'	'
Finished goods	$15,918	$17,148
Parts and components	1,603	1,639
Total inventories	$17,521	$18,787

Inventory_Reserve_Details

Inventory Reserve (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
In Thousands, unless otherwise specified
Inventory Disclosure [Abstract]	'	'
Inventory reserves	$683	$1,011

Property_Plant_and_Equipment_D

Property, Plant and Equipment (Details) (USD $)	9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013		Dec. 31, 2012
Property, Plant and Equipment [Line Items]	'		'
Property, plant and equipment, gross	$49,508		$47,279
Accumulated depreciation	-41,413		-41,141
Total property, plant and equipment, net	8,095		6,138
Leasehold improvements	'		'
Property, Plant and Equipment [Line Items]	'		'
Property, plant and equipment, gross	2,917		2,863
Leasehold improvements | Minimum [Member]	'		'
Property, Plant and Equipment [Line Items]	'		'
Estimated Useful Life (in years)	'5 years		'
Leasehold improvements | Maximum [Member]	'		'
Property, Plant and Equipment [Line Items]	'		'
Estimated Useful Life (in years)	'20 years		'
Computer equipment	'		'
Property, Plant and Equipment [Line Items]	'		'
Property, plant and equipment, gross	36,505		36,107
Computer equipment | Minimum [Member]	'		'
Property, Plant and Equipment [Line Items]	'		'
Estimated Useful Life (in years)	'3 years		'
Computer equipment | Maximum [Member]	'		'
Property, Plant and Equipment [Line Items]	'		'
Estimated Useful Life (in years)	'5 years		'
Machinery and equipment	'		'
Property, Plant and Equipment [Line Items]	'		'
Property, plant and equipment, gross	5,164		5,359
Machinery and equipment | Minimum [Member]	'		'
Property, Plant and Equipment [Line Items]	'		'
Estimated Useful Life (in years)	'3 years		'
Machinery and equipment | Maximum [Member]	'		'
Property, Plant and Equipment [Line Items]	'		'
Estimated Useful Life (in years)	'5 years		'
Furniture and fixtures	'		'
Property, Plant and Equipment [Line Items]	'		'
Property, plant and equipment, gross	690		870
Estimated Useful Life (in years)	'5 years		'
Work in Progress	'		'
Property, Plant and Equipment [Line Items]	'		'
Property, plant and equipment, gross	$4,232	[1]	$2,080	[1]
[1]	Work in progress includes internal use software development and production tooling construction in progress.

Goodwill_and_Other_Intangible_2

Goodwill and Other Intangible Assets Goodwill Roll Forward (Details) (USD $)	9 Months Ended	12 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Goodwill [Roll Forward]	'	'
Balance	$2,940	$2,873
Currency exchange rate adjustment	-98	67
Balance	$2,842	$2,940

Goodwill_and_Other_Intangible_3

Goodwill and Other Intangible Assets (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012	Sep. 30, 2013	Sep. 30, 2013
In Thousands, unless otherwise specified			Patents [Member]	Patents [Member]
			Minimum [Member]	Maximum [Member]
Other intangible assets:	'	'	'	'
Indefinite-lived trademarks	$9,052	$9,052	'	'
Patents	18,154	18,154	'	'
Total other intangible assets, gross	27,206	27,206	'	'
Accumulated amortization - patents	-14,078	-12,540	'	'
Other intangible assets, net	$13,128	$14,666	'	'
Estimated Useful Life (in years)	'	'	'8 years	'16 years

Goodwill_and_Other_Intangible_4

Goodwill and Other Intangible Assets Patent amortization (Details) (USD $)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Goodwill and Intangible Assets Disclosure [Abstract]	'	'	'	'
Patent amortization	$513	$513	$1,538	$1,538

Goodwill_and_Other_Intangible_5

Goodwill and Other Intangible Assets Future intangible amortization (Details) (USD $)	Sep. 30, 2013
In Thousands, unless otherwise specified
Goodwill and Intangible Assets Disclosure [Abstract]	'
Remainder of 2013	$513
2014	2,040
2015	828
2016	430
2017	143
Thereafter	122
Finite-Lived Intangible Assets, Net	$4,076

Accrued_Liabilities_Details

Accrued Liabilities (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
In Thousands, unless otherwise specified
Payables and Accruals [Abstract]	'	'
Exit costs of discontinued operations	$300	$340
Payroll and related liabilities	3,320	3,327
Royalties	753	1,063
Legal and professional fees	153	834
Other	2,355	2,607
Total accrued liabilities	$6,881	$8,171

Product_Warranties_Details

Product Warranties (Details) (USD $)	9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012
Movement in Product Warranty Liability [Roll Forward]	'	'
Balance, beginning of period	$2,492	$2,017
Payments	-1,416	-1,428
Adjustments	-186	-171
Accruals	951	1,645
Balance, end of period	$1,841	$2,063
Minimum [Member]	'	'
Product Liability Contingency [Line Items]	'	'
Product warranty period	'60 days	'

Income_Tax_Provision_Benefit_D

Income Tax Provision (Benefit) (Details) (USD $)	3 Months Ended	9 Months Ended
In Millions, unless otherwise specified	Jun. 30, 2013	Sep. 30, 2013
Operating Loss Carryforwards [Line Items]	'	'
Number of years cumulative income or loss is evaluated	'3 years	'
Income tax benefit related to decrease in valuation allowance of deferred tax assets	'	$36.30
Domestic Tax Authority [Member]	'	'
Operating Loss Carryforwards [Line Items]	'	'
Valuation allowance	'	$8.50

Income_Per_Share_Details

Income Per Share (Details)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Income per share:	'	'	'	'
Shares used to calculate basic income per share	31,128	30,892	31,045	30,892
Dilutive effect of outstanding options and performance stock units	360	51	374	118
Shares used to calculate diluted income per share	31,488	30,943	31,419	31,010
Stock options	'	'	'	'
Income per share:	'	'	'	'
Anti-dilutive securities excluded from computation of diluted income per share	298	1,115	303	1,072
Performance stock units	'	'	'	'
Income per share:	'	'	'	'
Anti-dilutive securities excluded from computation of diluted income per share	84	130	17	47

Segment_Information_Details

Segment Information (Details) (USD $)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
			segment
Segment Reporting Information [Line Items]	'	'	'	'
Number of reportable segments	'	'	2	'
Net sales	$46,256	$38,052	$141,712	$128,897
Contribution	5,349	4,335	16,864	13,446
Reconciliation of consolidated contribution to income (loss) from continuing operations:	'	'	'	'
Operating expenses	-20,441	-17,843	-64,194	-56,686
Income tax (expense) benefit	-101	625	33,814	554
Income from continuing operations	1,500	1,216	39,692	3,377
Direct	'	'	'	'
Segment Reporting Information [Line Items]	'	'	'	'
Net sales	25,729	25,103	93,678	83,544
Contribution	1,316	1,947	8,533	5,968
Retail	'	'	'	'
Segment Reporting Information [Line Items]	'	'	'	'
Net sales	19,369	11,388	44,678	42,057
Contribution	2,875	827	4,975	4,182
Unallocated royalty income	'	'	'	'
Segment Reporting Information [Line Items]	'	'	'	'
Net sales	1,158	1,561	3,356	3,296
Contribution	1,158	1,561	3,356	3,296
Less expenses not directly related to segments	'	'	'	'
Reconciliation of consolidated contribution to income (loss) from continuing operations:	'	'	'	'
Operating expenses	-4,013	-3,637	-11,258	-10,518
Other income (expense), net	265	-107	272	-105
Income tax (expense) benefit	-101	625	33,814	554
Income from continuing operations	$1,500	$1,216	$39,692	$3,377

Commitments_and_Contingencies_

Commitments and Contingencies (Details) (USD $)	Sep. 30, 2013
In Millions, unless otherwise specified
Commitments and Contingencies Disclosure [Abstract]	'
Standby letters of credit outstanding	$0.60
Non-cancelable market-based purchase obligation	$9.30