Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Dec. 31, 2020 | Feb. 02, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | EXTREME NETWORKS, INC. | |
Entity Central Index Key | 0001078271 | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Document Type | 10-Q | |
Document Period End Date | Dec. 31, 2020 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | EXTR | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 123,812,438 | |
Entity File Number | 000-25711 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 77-0430270 | |
Entity Address, Address Line One | 6480 Via Del Oro | |
Entity Address, City or Town | San Jose | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 95119 | |
City Area Code | 408 | |
Local Phone Number | 579-2800 | |
Title of 12(b) Security | Common Stock | |
Security Exchange Name | NASDAQ | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes | |
Entity Current Reporting Status | Yes |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Current assets: | ||
Cash | $ 183,969 | $ 193,872 |
Accounts receivable, net of allowance for doubtful accounts of $1,335 and $1,212, respectively | 128,242 | 122,727 |
Inventories | 49,830 | 62,589 |
Prepaid expenses and other current assets | 41,257 | 35,019 |
Total current assets | 403,298 | 414,207 |
Property and equipment, net | 55,974 | 58,813 |
Operating lease right-of-use assets, net | 45,087 | 51,274 |
Intangible assets, net | 51,748 | 68,394 |
Goodwill | 331,159 | 331,159 |
Other assets | 58,571 | 55,241 |
Total assets | 945,837 | 979,088 |
Current liabilities: | ||
Current portion of long-term debt, net of unamortized debt issuance costs of $2,463 and $2,484, respectively | 18,912 | 16,516 |
Accounts payable | 53,677 | 48,439 |
Accrued compensation and benefits | 62,212 | 50,884 |
Accrued warranty | 13,073 | 14,035 |
Current portion of operating lease liabilities | 19,226 | 19,196 |
Current portion of deferred revenue | 198,291 | 190,226 |
Other accrued liabilities | 56,851 | 58,525 |
Total current liabilities | 422,242 | 397,821 |
Deferred revenue, less current portion | 110,844 | 100,961 |
Long-term debt, less current portion, net of unamortized debt issuance costs of $5,934 and $7,165, respectively | 328,941 | 394,585 |
Operating lease liabilities, less current portion | 42,059 | 50,238 |
Deferred income taxes | 2,650 | 2,334 |
Other long-term liabilities | 21,176 | 27,751 |
Commitments and contingencies (Note 9) | ||
Stockholders’ equity: | ||
Common stock, $0.001 par value, 750,000 shares authorized; 130,180 and 127,114 shares issued, respectively; 123,583 and 120,517 shares outstanding, respectively | 130 | 127 |
Additional paid-in-capital | 1,055,719 | 1,035,041 |
Accumulated other comprehensive loss | (2,670) | (6,378) |
Accumulated deficit | (992,141) | (980,279) |
Treasury stock at cost: 6,597 and 6,597 shares, respectively | (43,113) | (43,113) |
Total stockholders’ equity | 17,925 | 5,398 |
Total liabilities and stockholders’ equity | $ 945,837 | $ 979,088 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) (Unaudited) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Current assets: | ||
Allowance for doubtful accounts | $ 1,335 | $ 1,212 |
Current liabilities: | ||
Net of unamortized debt issuance costs | 2,463 | 2,484 |
Noncurrent liabilities: | ||
Net of unamortized debt issuance costs | $ 5,934 | $ 7,165 |
Stockholders’ equity: | ||
Convertible preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Convertible preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Convertible preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 750,000,000 | 750,000,000 |
Common stock, shares issued | 130,180,000 | 127,114,000 |
Common stock, shares outstanding | 123,583,000 | 120,517,000 |
Treasury stock, shares | 6,597,000 | 6,597,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Net revenues: | ||||
Total net revenues | $ 242,128 | $ 267,472 | $ 477,930 | $ 522,978 |
Cost of revenues: | ||||
Total cost of revenues | 101,936 | 118,801 | 202,720 | 237,064 |
Gross profit: | ||||
Total gross profit | 140,192 | 148,671 | 275,210 | 285,914 |
Operating expenses: | ||||
Research and development | 49,186 | 55,380 | 98,710 | 114,496 |
Sales and marketing | 66,732 | 75,436 | 131,057 | 146,793 |
General and administrative | 16,360 | 15,098 | 32,821 | 30,080 |
Acquisition and integration costs | 8,994 | 1,975 | 24,919 | |
Restructuring and related charges, net of reversals | 695 | 6,622 | 1,696 | 12,759 |
Amortization of intangibles | 1,506 | 2,377 | 3,298 | 4,307 |
Total operating expenses | 134,479 | 163,907 | 269,557 | 333,354 |
Operating income (loss) | 5,713 | (15,236) | 5,653 | (47,440) |
Interest income | 82 | 477 | 200 | 1,144 |
Interest expense | (6,068) | (6,234) | (12,731) | (11,398) |
Other expense, net | (954) | (748) | (1,841) | (190) |
Loss before income taxes | (1,227) | (21,741) | (8,719) | (57,884) |
Provision for income taxes | 1,823 | 1,797 | 3,143 | 3,392 |
Net loss | $ (3,050) | $ (23,538) | $ (11,862) | $ (61,276) |
Basic and diluted loss per share: | $ (0.02) | $ (0.20) | $ (0.10) | $ (0.51) |
Shares used in per share calculation - basic and diluted | 123,264 | 119,555 | 122,485 | 119,891 |
Product | ||||
Net revenues: | ||||
Total net revenues | $ 165,845 | $ 190,492 | $ 327,241 | $ 375,626 |
Cost of revenues: | ||||
Total cost of revenues | 74,005 | 91,387 | 147,400 | 182,778 |
Gross profit: | ||||
Total gross profit | 91,840 | 99,105 | 179,841 | 192,848 |
Service and Subscription | ||||
Net revenues: | ||||
Total net revenues | 76,283 | 76,980 | 150,689 | 147,352 |
Cost of revenues: | ||||
Total cost of revenues | 27,931 | 27,414 | 55,320 | 54,286 |
Gross profit: | ||||
Total gross profit | $ 48,352 | $ 49,566 | $ 95,369 | $ 93,066 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net loss | $ (3,050) | $ (23,538) | $ (11,862) | $ (61,276) |
Interest rate swap derivatives designated as hedging instruments: | ||||
Unrealized losses on derivative instruments | (120) | (293) | ||
Reclassification adjustment related to derivative instruments | 226 | 386 | ||
Net decrease from derivatives designated as hedging instruments. | 106 | 93 | ||
Change in unrealized losses on available for sale securities | 7 | |||
Net change in foreign currency translation adjustments | 2,160 | 879 | 3,615 | (12) |
Other comprehensive income (loss), net of tax: | 2,266 | 886 | 3,708 | (12) |
Total comprehensive loss | $ (784) | $ (22,652) | $ (8,154) | $ (61,288) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In-Capital | Accumulated Other Comprehensive Loss | Treasury Stock | Accumulated Deficit |
Balance at Jun. 30, 2019 | $ 115,987 | $ 122 | $ 986,772 | $ (2,473) | $ (853,434) | |
Balance, common stock, shares at Jun. 30, 2019 | 121,538 | |||||
Treasury stock, shares at Jun. 30, 2019 | (2,366) | |||||
Treasury stock, value at Jun. 30, 2019 | $ (15,000) | |||||
Net loss | (61,276) | (61,276) | ||||
Other comprehensive income (loss) | (12) | (12) | ||||
Issuance of common stock from equity incentive plans, net of tax | 2,906 | $ 3 | 2,903 | |||
Issuance of common stock from equity incentive plans, net of tax, shares | 3,078 | |||||
Stock awards granted in connection with acquisition | 3,530 | 3,530 | ||||
Equity forward contract | (4,821) | (4,821) | ||||
Repurchase of stock | (25,179) | $ (25,179) | ||||
Repurchase of stock, shares | (3,850) | |||||
Share-based compensation | 19,792 | 19,792 | ||||
Balance at Dec. 31, 2019 | 50,927 | $ 125 | 1,008,176 | (2,485) | (914,710) | |
Balance, common stock, shares at Dec. 31, 2019 | 124,616 | |||||
Treasury stock, shares at Dec. 31, 2019 | (6,216) | |||||
Treasury stock, value at Dec. 31, 2019 | $ (40,179) | |||||
Balance at Sep. 30, 2019 | 93,849 | $ 124 | 1,003,268 | (3,371) | (891,172) | |
Balance, common stock, shares at Sep. 30, 2019 | 123,864 | |||||
Treasury stock, shares at Sep. 30, 2019 | (2,366) | |||||
Treasury stock, value at Sep. 30, 2019 | $ (15,000) | |||||
Net loss | (23,538) | (23,538) | ||||
Other comprehensive income (loss) | 886 | 886 | ||||
Issuance of common stock from equity incentive plans, net of tax | (1,228) | $ 1 | (1,229) | |||
Issuance of common stock from equity incentive plans, net of tax, shares | 752 | |||||
Equity forward contract | (4,821) | (4,821) | ||||
Repurchase of stock | (25,179) | $ (25,179) | ||||
Repurchase of stock, shares | (3,850) | |||||
Share-based compensation | 10,958 | 10,958 | ||||
Balance at Dec. 31, 2019 | 50,927 | $ 125 | 1,008,176 | (2,485) | (914,710) | |
Balance, common stock, shares at Dec. 31, 2019 | 124,616 | |||||
Treasury stock, shares at Dec. 31, 2019 | (6,216) | |||||
Treasury stock, value at Dec. 31, 2019 | $ (40,179) | |||||
Balance at Jun. 30, 2020 | $ 5,398 | $ 127 | 1,035,041 | (6,378) | (980,279) | |
Balance, common stock, shares at Jun. 30, 2020 | 127,114 | 127,114 | ||||
Treasury stock, shares at Jun. 30, 2020 | (6,597) | (6,597) | ||||
Treasury stock, value at Jun. 30, 2020 | $ (43,113) | $ (43,113) | ||||
Net loss | (11,862) | (11,862) | ||||
Other comprehensive income (loss) | 3,708 | 3,708 | ||||
Issuance of common stock from equity incentive plans, net of tax | 2,284 | $ 3 | 2,281 | |||
Issuance of common stock from equity incentive plans, net of tax, shares | 3,066 | |||||
Share-based compensation | 18,397 | 18,397 | ||||
Balance at Dec. 31, 2020 | $ 17,925 | $ 130 | 1,055,719 | (2,670) | (992,141) | |
Balance, common stock, shares at Dec. 31, 2020 | 130,180 | 130,180 | ||||
Treasury stock, shares at Dec. 31, 2020 | (6,597) | (6,597) | ||||
Treasury stock, value at Dec. 31, 2020 | $ (43,113) | $ (43,113) | ||||
Balance at Sep. 30, 2020 | 9,911 | $ 130 | 1,046,921 | (4,936) | (989,091) | |
Balance, common stock, shares at Sep. 30, 2020 | 129,532 | |||||
Treasury stock, shares at Sep. 30, 2020 | (6,597) | |||||
Treasury stock, value at Sep. 30, 2020 | $ (43,113) | |||||
Net loss | (3,050) | (3,050) | ||||
Other comprehensive income (loss) | 2,266 | 2,266 | ||||
Issuance of common stock from equity incentive plans, net of tax | (1,297) | (1,297) | ||||
Issuance of common stock from equity incentive plans, net of tax, shares | 648 | |||||
Share-based compensation | 10,095 | 10,095 | ||||
Balance at Dec. 31, 2020 | $ 17,925 | $ 130 | $ 1,055,719 | $ (2,670) | $ (992,141) | |
Balance, common stock, shares at Dec. 31, 2020 | 130,180 | 130,180 | ||||
Treasury stock, shares at Dec. 31, 2020 | (6,597) | (6,597) | ||||
Treasury stock, value at Dec. 31, 2020 | $ (43,113) | $ (43,113) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (11,862) | $ (61,276) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation | 12,471 | 14,251 |
Amortization of intangible assets | 16,646 | 17,772 |
Reduction in carrying amount of right-of-use asset | 8,072 | 8,477 |
Provision for doubtful accounts | 143 | 626 |
Share-based compensation | 18,397 | 19,792 |
Deferred income taxes | 628 | 801 |
Non-cash restructuring and impairment charges | 7,622 | |
Non-cash interest expense | 2,171 | 1,982 |
Other | 3,195 | 735 |
Changes in operating assets and liabilities, net of acquisitions: | ||
Accounts receivable | (5,658) | 25,751 |
Inventories | 6,340 | 3,157 |
Prepaid expenses and other assets | (3,740) | (274) |
Accounts payable | 4,913 | (9,070) |
Accrued compensation and benefits | 10,984 | (3,036) |
Operating lease liabilities | (10,116) | (9,051) |
Deferred revenue | 17,949 | 6,181 |
Other current and long-term liabilities | (7,762) | (2,529) |
Net cash provided by operating activities | 62,771 | 21,911 |
Cash flows from investing activities: | ||
Capital expenditures | (8,039) | (9,438) |
Business acquisitions, net of cash acquired | (219,458) | |
Maturities and sales of investments | 45,249 | |
Net cash used in investing activities | (8,039) | (183,647) |
Cash flows from financing activities: | ||
Borrowings under Term Loan | 199,500 | |
Payments on debt obligations | (64,500) | (24,950) |
Loan fees on borrowings | (10,514) | |
Equity forward contract | (4,821) | |
Repurchase of common stock | (25,179) | |
Proceeds from issuance of common stock, net of tax withholding | 2,284 | 2,906 |
Payment of contingent consideration obligations | (1,021) | (2,206) |
Deferred payments on an acquisition | (2,000) | (2,000) |
Net cash (used in) provided by financing activities | (65,237) | 132,736 |
Foreign currency effect on cash | 602 | (193) |
Net decrease in cash | (9,903) | (29,193) |
Cash at beginning of period | 193,872 | 169,607 |
Cash at end of period | $ 183,969 | $ 140,414 |
Description of Business and Bas
Description of Business and Basis of Presentation | 6 Months Ended |
Dec. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of Business and Basis of Presentation | 1. Description of Business and Basis of Presentation Extreme Networks, Inc., together with its subsidiaries (collectively referred to as “Extreme” or the “Company”), is a leader in providing software-driven networking solutions for enterprise customers. The Company conducts its sales and marketing activities on a worldwide basis through distributors, resellers and the Company’s field sales organization. Extreme was incorporated in California in 1996 and reincorporated in Delaware in 1999. The unaudited condensed consolidated financial statements of Extreme included herein have been prepared under the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted under such rules and regulations. The condensed consolidated balance sheet at June 30, 2020 was derived from audited financial statements as of that date but does not include all disclosures required by generally accepted accounting principles for complete financial statements. These interim financial statements and notes should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2020. The unaudited condensed consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments that, in the opinion of management, are necessary for a fair presentation of the results of operations and cash flows for the interim periods presented and the financial condition of Extreme at December 31, 2020. The results of operations for the three and six months ended December 31, 2020 are not necessarily indicative of the results that may be expected for fiscal 2021 or any future periods. Fiscal Year The Company uses a fiscal calendar year ending on June 30. All references herein to “fiscal 2021” or “2021” represent the fiscal year ending June 30, 2021. All references herein to “fiscal 2020” or “2020” represent the fiscal year ended June 30, 2020. Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of Extreme and its wholly owned subsidiaries. All inter-company accounts and transactions have been eliminated. The Company predominantly uses the United States Dollar as its functional currency. The functional currency for certain of its foreign subsidiaries is the local currency. For those subsidiaries that operate in a local functional currency environment, all assets and liabilities are translated to United States Dollars at current month end rates of exchange and revenues and expenses are translated using the monthly average rate. Accounting Estimates The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies For a description of significant accounting policies, see Note 2, Summary of Significant Accounting Policies, to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2020. There have been no material changes to the Company’s significant accounting policies since the filing of the Annual Report on Form 10-K. Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses The Company adopted the standard on July 1, 2020 and the impact of the adoption was not material to the Company's condensed consolidated financial statements as credit losses are not expected to be significant based on historical collection trends, the financial condition of payment partners, and external market factors . In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40 Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, Income taxes – Simplifying the Accounting for Income Taxes (Topic 740 Income Taxes and related disclosures |
Revenues
Revenues | 6 Months Ended |
Dec. 31, 2020 | |
Revenue From Contract With Customer [Abstract] | |
Revenues | 3. Revenues The Company accounts for revenues in accordance with ASU 2014-09, Revenue from Contracts from Customers (Topic 606) Revenue Recognition Performance Obligations. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in Topic 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Certain of the Company’s contracts have multiple performance obligations, as the promise to transfer individual goods or services is separately identifiable from other promises in the contracts and, therefore, is distinct. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation based on its relative standalone selling price. The stand-alone selling prices are determined based on the prices at which the Company separately sells these products. For items that are not sold separately, the Company estimates the stand-alone selling prices using other observable inputs. The Company’s performance obligations are satisfied at a point in time or over time as the customer receives and consumes the benefits provided. Substantially all of the Company’s product sales revenues are recognized at a point in time. Substantially all of the Company’s service, subscription, and SaaS revenues are recognized over time. For revenues recognized over time, the Company uses an input measure, days elapsed, to measure progress. On December 31, 2020 , the Company had $ 309.1 million of remaining performance obligations, which are primarily comprised of deferred maintenance and SaaS revenue s . The Company expects to recognize approximately percent of its deferred revenue as revenue in fiscal 2021 , an additional 34 percent in fiscal 2022 and 26 percent of the balance thereafter . Contract Balances. The timing of revenue recognition, billings and cash collections results in billed accounts receivable and deferred revenue in the condensed consolidated balance sheets. Services provided under renewable support arrangements of the Company are billed in accordance with agreed-upon contractual terms, which are either billed fully at the inception of contract or at periodic intervals (e.g., quarterly or annually). The Company sometimes receives payments from its customers in advance of services being provided, resulting in deferred revenues. These liabilities are reported on the condensed consolidated balance sheets on a contract-by-contract basis at the end of each reporting period. Revenue recognized for the three months ended December 31, 2020 and 2019 that was included in the deferred revenue balance at the beginning of each period was $68.8 million and $67.2 million, respectively. Revenue recognized for the six months ended December 31, 2020 and 2019 that was included in the deferred revenue balance at the beginning of each period was $120.5 million and $90.9 million, respectively. Contract Costs. The Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. Management expects that commission fees paid to sales representatives as a result of obtaining service contracts and contract renewals are recoverable and therefore the Company’s condensed consolidated balance sheets included capitalized balances in the amount of $9.2 million and $8.1 million at December 31, 2020 and June 30, 2020, respectively. Capitalized commission fees are amortized on a straight-line basis over the average period of service contracts of approximately three years, and are included in “Sales and marketing” in the accompanying condensed consolidated statements of operations. Amortization recognized during the three months ended December 31, 2020 and 2019, was $1.2 million and $1.5 million, respectively. Amortization recognized during the six months ended December 31, 2020 and 2019, was $2.5 million and $3.0 million, respectively. Estimated Variable Consideration. There were no material changes in the current period to the estimated variable consideration for performance obligations which were satisfied or partially satisfied during previous periods. Revenues by Category The following table sets forth the Company’s revenues disaggregated by sales channel and geographic region based on the customer’s ship-to locations (in thousands): Three Months Ended December 31, 2020 December 31, 2019 Distributor Direct Total Distributor Direct Total Americas: United States $ 46,506 $ 58,744 $ 105,250 $ 60,111 $ 61,622 $ 121,733 Other 8,950 3,648 12,598 8,204 5,563 13,767 Total Americas 55,456 62,392 117,848 68,315 67,185 135,500 EMEA 69,602 34,220 103,822 64,717 44,257 108,974 APAC 2,793 17,665 20,458 6,007 16,991 22,998 Total net revenues $ 127,851 $ 114,277 $ 242,128 $ 139,039 $ 128,433 $ 267,472 Six Months Ended December 31, 2020 December 31, 2019 Distributor Direct Total Distributor Direct Total Americas: United States $ 107,176 $ 116,091 $ 223,267 $ 130,089 $ 123,967 $ 254,056 Other 17,191 7,738 24,929 12,219 10,562 22,781 Total Americas 124,367 123,829 248,196 142,308 134,529 276,837 EMEA 117,131 67,796 184,927 123,846 73,891 197,737 APAC 7,844 36,963 44,807 15,120 33,284 48,404 Total net revenues $ 249,342 $ 228,588 $ 477,930 $ 281,274 $ 241,704 $ 522,978 For the three months ended December 31, 2020 the Company reflected 11% of its revenues from the Netherlands and 11% of its revenues from Germany. For the six months ended December 31, 2020 the Company reflected 10% of its revenues from the Netherlands and 10% of its revenue from Germany. No other foreign country accounted for 10% Customer Concentrations The Company performs ongoing credit evaluations of its customers and generally does not require collateral in exchange for credit. The following table sets forth customers accounting for 10% or more of the Company’s net revenues for the periods indicated below: Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Tech Data Corporation 21% 14% 24% 15% Jenne Corporation 11% 18% 13% 16% Westcon Group Inc. 19% 15% 16% 13% The following table sets forth customers accounting for 10% or more of the Company’s accounts receivable balance: December 31, 2020 June 30, 2020 Tech Data Corporation 20% 23% Jenne Corporation 16% 25% Westcon Group Inc. 18% * * Less than 10% of accounts receivable. |
Business Combination
Business Combination | 6 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
Business Combination | 4. Business Combination Fiscal 2020 Acquisition Aerohive Acquisition On August 9, 2019 (the “Acquisition Date”), the Company consummated its acquisition (the “Acquisition”) of all of the outstanding common stock of Aerohive Networks, Inc. (“Aerohive”) pursuant to that certain Agreement and Plan of Merger entered into as of June 26, 2019. Under the terms of the Acquisition, the net consideration paid by Extreme to Aerohive stockholders was $267.1 million. The Acquisition was accounted for using the acquisition method of accounting whereby the acquired assets and liabilities of Aerohive were recorded at their respective fair values and added to those of the Company including an amount for goodwill calculated as the difference between the acquisition consideration and the fair value of the identifiable net assets. Of the total purchase consideration, $192.6 million was allocated to goodwill, $52.5 million to identifiable intangible assets and the remainder to net tangible assets assumed. All valuations were finalized as of June 30, 2020. The following unaudited pro forma results of operations are presented as though the Acquisition had occurred as of July 1, 2018, the beginning of fiscal 2019, after giving effect to purchase accounting adjustments relating to inventories, deferred revenue, depreciation and amortization of intangibles, acquisition and integration costs, interest income and expense and related tax effects. The pro forma results of operations are not necessarily indicative of the combined results that would have occurred had the acquisition been consummated as of the beginning of fiscal 2019, nor are they necessarily indicative of future operating results. The unaudited pro forma results do not include the impact of synergies, nor any potential impacts on current or future market conditions which could alter the unaudited pro forma results. The unaudited pro forma financial information for the three and six months ended December 31, 2019 combines the historical results for Extreme for such periods assuming the transaction closed on July 1, 2019, which include the results of Aerohive subsequent to the Acquisition Date, and Aerohive’s historical results up to the Acquisition Date. The following table summarizes the unaudited pro forma financial information (in thousands, except per share amounts): Three Months Ended Six Months Ended December 31, 2019 December 31, 2019 Net revenues $ 268,367 $ 536,045 Net loss $ (5,031 ) $ (28,847 ) Net loss per share - basic and diluted $ (0.04 ) $ (0.24 ) Shares used in per share calculation - basic and diluted 119,555 119,891 |
Balance Sheet Accounts
Balance Sheet Accounts | 6 Months Ended |
Dec. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Balance Sheet Accounts | 5. Balance Sheet Accounts Inventories The Company values its inventory at the lower of cost or net realizable value. Cost is computed using standard cost, which approximates actual cost, on a first-in, first-out basis. The Company adjusts the carrying value of its inventory when conditions exist that suggest that inventory may be in excess of anticipated demand or is obsolete based upon assumptions about future demand. At the point of the loss recognition, a new, lower-cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established cost basis. Any previously written down or obsolete inventory subsequently sold has not had a material impact on gross margin for any of the periods presented. Inventories consist of the following (in thousands): December 31, 2020 June 30, 2020 Finished goods $ 43,212 $ 52,879 Raw materials 6,618 9,710 Total Inventories $ 49,830 $ 62,589 Property and Equipment, Net Property and equipment, net consist of the following (in thousands): December 31, 2020 June 30, 2020 Computers and equipment $ 75,882 $ 73,244 Purchased software 38,177 34,015 Office equipment, furniture and fixtures 10,779 10,639 Leasehold improvements 53,421 52,317 Total property and equipment 178,259 170,215 Less: accumulated depreciation and amortization (122,285 ) (111,402 ) Property and equipment, net $ 55,974 $ 58,813 Deferred Revenue Deferred revenue represents amounts for deferred maintenance, support, SaaS, and other deferred revenue including professional services and training when the revenue recognition criteria have not been met. Guarantees and Product Warranties The majority of the Company’s hardware products are shipped with either a one-year The following table summarizes the activity related to the Company’s product warranty liability during the three and six months ended December 31, 2020 and 2019 (in thousands): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Balance beginning of period $ 13,484 $ 15,988 $ 14,035 $ 14,779 Warranties assumed due to acquisitions — — — 570 New warranties issued 3,056 5,539 6,135 11,461 Warranty expenditures (3,467 ) (5,318 ) (7,097 ) (10,601 ) Balance end of period $ 13,073 $ 16,209 $ 13,073 $ 16,209 To facilitate sales of its products in the normal course of business, the Company indemnifies its resellers and end-user customers with respect to certain matters. The Company has agreed to hold the customer harmless against losses arising for intellectual property infringement and certain other losses. These agreements may limit the time within which an indemnification claim can be made and the amount of the claim. It is not possible to estimate the maximum potential amount under these indemnification agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. Historically, payments made by the Company under these agreements have not had a material impact on its operating results or financial position. Concentrations The Company may be subject to concentration of credit risk as a result of certain financial instruments consisting of accounts receivable. The Company does not invest an amount exceeding 10% of its combined cash and cash equivalents in the securities of any one obligor or maker, except for obligations of the United States government, obligations of United States government agencies and money market accounts. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 6. Fair Value Measurements A three-tier fair value hierarchy is utilized to prioritize the inputs used in measuring fair value. The hierarchy gives the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels are defined as follows: • Level 1 Inputs - unadjusted quoted prices in active markets for identical assets or liabilities; • Level 2 Inputs - quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument; and • Level 3 Inputs - unobservable inputs reflecting the Company’s own assumptions in measuring the asset or liability at fair value. The following table presents the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis at December 31, 2020 and June 30, 2020 (in thousands). December 31, 2020 Level 1 Level 2 Level 3 Total Assets Foreign currency derivatives $ — $ 127 $ — $ 127 Total assets measured at fair value $ — $ 127 $ — $ 127 Liabilities Foreign currency derivatives $ — $ 22 $ — $ 22 Interest rate swaps — 1,676 — 1,676 Acquisition-related contingent consideration obligations — — 1,168 1,168 Total liabilities measured at fair value $ — $ 1,698 $ 1,168 $ 2,866 June 30, 2020 Level 1 Level 2 Level 3 Total Liabilities Foreign currency derivatives $ — $ 8 $ — $ 8 Interest rate swaps — 1,769 — 1,769 Acquisition-related contingent consideration obligations — — 2,167 2,167 Total liabilities measured at fair value $ — $ 1,777 $ 2,167 $ 3,944 Level 1 Assets and Liabilities : The Company’s financial instruments consist of cash, accounts receivable, accounts payable, and accrued liabilities. The Company states accounts receivable, accounts payable and accrued liabilities at their carrying value, which approximates fair value due to the short time to the expected receipt or payment. Level 2 Assets and Liabilities : The fair value of derivative instruments under the Company’s foreign exchange forward contracts and interest rate swaps are estimated based on valuations provided by alternative pricing sources supported by observable inputs which is considered Level 2. As of December 31, 2020 and June 30, 2020, the Company had foreign exchange forward contracts with notional principal amount of $22.7 million and $4.0 million, respectively. For the three and six months ended December 31, 2020, there were unrealized gains of $0.1 million and $0.1 million, respectively. For the three and six months ended December 31, 2020, there were realized gains of $0.3 million and $0.4 million, respectively. There were no foreign exchange forward contracts or related gains or losses for the three and six months ended December 31, 2019. These contracts have maturities of less than 40 days The fair values of the interest rate swaps are based upon inputs corroborated by observable market data which is considered Level 2. As of December 31, 2020 , the Company had interest rate swap contracts with the total notional amount of $200.0 million. Changes in fair value of these contracts are recorded as a component of accumulated other comprehensive loss. As of December 31, 2020 and as of June 30, 2020 these contracts had an unrealized loss of $1.7 million and $1.8 million, respectively. See Note 13, Derivatives and Hedging, for additional information. The fair value of the borrowings under the 2019 Credit Agreement (as defined below) is estimated based on valuations provided by alternative pricing sources supported by observable inputs which is considered Level 2. Since the interest rate is variable in the 2019 Credit Agreement, the fair value approximates the face amount of the Company’s indebtedness of $356.3 million and $420.8 million as of December 31, 2020, and June 30, 2020, respectively. Level 3 Assets and Liabilities: Certain of the Company’s assets, including intangible assets and goodwill are measured at fair value on a non-recurring basis if impairment is indicated. At December 31, 2020 and June 30, 2020, the Company reflected one liability measured at fair value of $1.2 million and $2.2 million, respectively, for contingent consideration related to a certain acquisition completed in fiscal 2018. The fair value measurement of the contingent consideration obligation is determined using Level 3 inputs. These fair value measurements represent Level 3 measurements as they are based on significant inputs not observable in the market. Changes in the value of the contingent consideration obligations is recorded in general and administrative expenses in the accompanying condensed consolidated statements of operations. The change in the acquisition-related contingent consideration obligations is as follows (in thousands): Six Months Ended Six Months Ended December 31, 2020 December 31, 2019 Beginning balance 2,167 6,298 Payments (1,021 ) (2,206 ) Accretion on discount 22 60 Ending balance $ 1,168 $ 4,152 There were no transfers of assets or liabilities between Level 1, Level 2 and Level 3 during the three and six months ended December 31, 2020 and 2019 2019 The Company determines the basis of the cost of a security sold or the amount reclassified out of accumulated other comprehensive income (loss) into earnings using the specific identification method. |
Intangible Assets
Intangible Assets | 6 Months Ended |
Dec. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 7. Intangible Assets The following tables summarize the components of gross and net intangible asset balances (dollars in thousands): Weighted Average Remaining Amortization Gross Carrying Accumulated Net Carrying Period Amount Amortization Amount December 31, 2020 Developed technology 2.1 years $ 156,100 $ 117,034 $ 39,066 Customer relationships 4.8 years 63,039 52,077 10,962 Backlog — years 400 400 — Trade names 1.0 years 10,700 9,407 1,293 License agreements 5.9 years 2,445 2,018 427 Other intangibles — years 1,382 1,382 — Total intangibles, net $ 234,066 $ 182,318 $ 51,748 Weighted Average Remaining Amortization Gross Accumulated Net Carrying Period Amount Amortization Amount June 30, 2020 Developed technology 2.4 years $ 156,100 $ 103,806 $ 52,294 Customer relationships 4.8 years 63,039 49,598 13,441 Backlog — years 400 400 — Trade names 1.4 years 10,700 8,554 2,146 License agreements 5.8 years 2,445 1,932 513 Other intangibles — years 1,382 1,382 — Total intangibles, net $ 234,066 $ 165,672 $ 68,394 The amortization expense of intangibles for the periods presented is summarized below (in thousands): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Amortization in “Cost of revenues: Product and Service and subscription” $ 6,649 $ 6,970 $ 13,348 $ 13,465 Amortization of intangibles in "Operations" 1,506 2,377 3,298 4,307 Total amortization expense $ 8,155 $ 9,347 $ 16,646 $ 17,772 The amortization expense that is recognized in “Cost of revenues: Product and Service and subscription” is comprised of amortization for developed technology, license agreements and other intangibles. |
Debt
Debt | 6 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | 8. Debt The Company’s debt is comprised of the following (in thousands): December 31, 2020 June 30, 2020 Current portion of long-term debt: Term Loan $ 21,375 $ 19,000 Less: unamortized debt issuance costs (2,463 ) (2,484 ) Current portion of long-term debt $ 18,912 $ 16,516 Long-term debt, less current portion: Term Loan $ 334,875 $ 346,750 Revolving Facility — 55,000 Less: unamortized debt issuance costs (5,934 ) (7,165 ) Total long-term debt, less current portion 328,941 394,585 Total debt $ 347,853 $ 411,101 In connection with the Acquisition discussed in Note 4, on August 9, 2019, the Company entered into an Amended and Restated Credit Agreement (the “2019 Credit Agreement”), by and among the Company, as borrower, several banks and other financial institutions as Lenders, BMO Harris Bank N.A., as an issuing lender and swingline lender, Silicon Valley Bank, as an Issuing Lender, and Bank of Montreal, as administrative agent and collateral agent for the Lenders. The 2019 Credit Agreement provides for a five-year five-year to partially fund the Acquisition and for working capital and general corporate purposes At the Company’s election, the initial term loan under the 2019 Credit Agreement may be made as either base rate loans or Eurodollar loans. The applicable margin for base rate loans ranges from 0.25% to 2.50% per annum and the applicable margin for Eurodollar loans ranges from 1.25% to 3.50%, in each case based on Extreme’s consolidated leverage ratio. All Eurodollar loans are subject to a Base Rate of 0.00%. In addition, the Company is required to pay a commitment fee of between 0.25% and 0.40% quarterly (currently 0.40%) on the unused portion of the 2019 Revolving Facility, also based on the Company’s consolidated leverage ratio. Principal installments are payable on the new term loan in varying percentages quarterly starting December 31, 2019 and to the extent not previously paid, all outstanding balances are to be paid at maturity. The 2019 Credit Agreement is secured by substantially all of the Company’s assets. The 2019 Credit Agreement requires the Company to maintain certain minimum financial ratios at the end of each fiscal quarter. The 2019 Credit Agreement also includes covenants and restrictions that limit, among other things, the Company’s ability to incur additional indebtedness, create liens upon any of its property, merge, consolidate or sell all or substantially all of its assets. The 2019 Credit Agreement also includes customary events of default which may result in acceleration of the payment of the outstanding balance. On April 8, 2020, the Company entered into the first amendment to the 2019 Credit Agreement (the “First Amendment”) to waive certain terms and financial covenants of the 2019 Credit Agreement through July 31, 2020. On May 8, 2020, the Company entered into the second amendment to the 2019 Credit Agreement (the “Second Amendment”) which supersedes the First Amendment and provides certain revised terms and financial covenants through March 31, 2021. Subsequent to March 31, 2021, the original terms and financial covenants under the 2019 Credit Agreement will resume in effect. The Second Amendment requires the Company to maintain certain minimum cash requirements and certain financial metrics at the end of each fiscal quarter through March 31, 2021. Under the terms of the Second Amendment, the Company is not permitted to exceed $55.0 million in its outstanding balance under the 2019 Revolving Facility, the applicable margin for Eurodollar rate will be 4.5%, and the Company is restricted from pursuing certain activities such as incurring additional debt, stock repurchases, making acquisitions or declaring a dividend, until the Company is in compliance with the original covenants of the 2019 Credit Agreement. On November 3, 2020, The Company and its lenders entered into the Third Amendment to increase the sublimit for letters of credit to $20.0 million. On December 8, 2020, the Company and its lenders entered into the fourth amendment to the 2019 Credit Agreement (the “Fourth Amendment”), to waive and amend certain terms and financial covenants within the 2019 Credit Agreement through March 31, 2021. Financing costs incurred in connection with obtaining long-term financing are deferred and amortized over the term of the related indebtedness or credit agreement. During the year ended June 30, 2020, the Company incurred $10.5 million of deferred financing costs in conjunction with the 2019 Credit Agreement and $1.5 million of deferred financing costs from the amendments, a nd continues to amortize $1.6 million of debt issuance costs as of August 9, 2019 that were associated with the previous facility Amortization of deferred financing costs included in “Interest expense” in the accompanying condensed consolidated statements of operati ons totaled $0.8 million and $0.7 million for the three months ended December 31, 2020 and 2019, and totaled $1.5 million and $1.1 million for the six months ended December 31, 2020 and 2019. During the six months ended December 31, 2020, the Company repaid $55.0 million against its 2019 Revolving Facility’s outstanding balance of $55.0 million and has no remaining outstanding balance at December 31, 2020. The Company has $55.0 million of availability under the 2019 Revolving Facility as of December 31, 2020. The Company had $8.8 million of outstanding letters of credit as of December 31, 2020. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Dec. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies Purchase Commitments The Company currently has arrangements with contract manufacturers and suppliers for the manufacture of its products. Those arrangements allow the contract manufactures to procure long lead-time component inventory based upon a rolling production forecast provided by the Company. The Company is obligated to purchase long lead-time component inventory that its contract manufacturer procures in accordance with the forecast, unless the Company gives notice of order cancellation outside of applicable component lead-times Legal Proceedings The Company may from time to time be party to litigation arising in the course of its business, including, without limitation, allegations relating to commercial transactions, business relationships or intellectual property rights. Such claims, even if not meritorious, could result in the expenditure of significant financial and managerial resources. Litigation in general, and intellectual property in particular, can be expensive and disruptive to normal business operations. Moreover, the results of legal proceedings are difficult to predict. In accordance with applicable accounting guidance, the Company records accruals for certain of its outstanding legal proceedings, investigations or claims when it is probable that a liability will be incurred, and the amount of loss can be reasonably estimated. The Company evaluates, at least 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 result in a loss contingency to become both probable and reasonably estimable. When a loss contingency is not both probable and reasonably estimable, the Company does not record a loss accrual. However, if the loss (or an additional loss in excess of any prior accrual) is at least a reasonable possibility and material, then the Company would 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. The assessment whether a loss is probable or a reasonable possibility, and whether the loss or a range of loss is estimable, involves a series of complex judgments about future events. Even if a loss is reasonably possible, the Company may not be able to estimate a range of possible loss, particularly where (i) the damages sought are substantial or indeterminate, (ii) the proceedings are in the early stages, or (iii) the matters involve novel or unsettled legal theories or a large number of parties. In such cases, there is considerable uncertainty regarding the ultimate resolution of such matters, including the amount of any possible loss, fine or penalty. Accordingly, for current proceedings, except as noted below, the Company is currently unable to estimate any reasonably possible loss or range of possible loss. However, an adverse resolution of one or more of such matters could have a material adverse effect on the Company's results of operations in a particular quarter or fiscal year. All currency conversions in this Legal Proceedings section are as of December 31, 2020. XR Communications, LLC d/b/a Vivato Technologies v. Extreme Networks, Inc. Patent Infringement Suit On April 19, 2017, XR Communications, LLC (“XR”) (d/b/a Vivato Technologies) filed a patent infringement lawsuit against the Company in the Central District of California. The operative Second Amended Complaint asserts infringement of U.S. Patent Nos. 7,062,296, 7,729,728, and 6,611,231 based on the Company’s manufacture, use, sale, offer for sale, and/or importation into the United States of certain access points and routers supporting multi-user, multiple-input, multiple-output technology. XR seeks unspecified damages, on-going royalties, pre- and post-judgment interest, and attorneys’ fees. In 2018, the Court stayed the case pending a resolution by the Patent Trial and Appeal Board (“PTAB”) of inter partes review (“IPR”) petitions filed by several defendants in other XR-related patent lawsuits challenging the validity of the asserted patents. The PTAB previously invalidated all asserted claims of the ’296 patent and ’728 patent and has found the challenged claims of the ’231 patent not invalid in view of the prior art asserted in the IPR instituted against that patent. Orckit IP, LLC v. Extreme Networks, Inc., Extreme Networks Ireland Ltd., and Extreme Networks GmbH On February 1, 2018, Orckit IP, LLC (“Orckit”) filed a patent infringement lawsuit against the Company and its Irish and German subsidiaries in the District Court in Dusseldorf, Germany. The lawsuit alleges direct and indirect infringement of the German portion of European Patent EP 1 958 364 B1 (“EP ’364”) based on the offer, distribution, use, possession and/or importation into Germany of certain network switches that equipped with the ExtremeXOS operating system. Orckit is seeking injunctive relief, accounting, and an unspecified declaration of liability for damages and costs of the lawsuit. On January 28, 2020, the Court rendered a decision in the infringement case in favor of the Company. The matter is proceeding through the appellate process, pursuant to the appeal filed by Orckit on March 13, 2020. On April 23, 2019, Orckit filed an extension of the patent infringement complaint against the Company and its Irish and German subsidiaries in the District Court in Dusseldorf, Germany. With this extension, Orckit alleges infringement of the German portion of European Patent EP 3 068 077 B1 (“EP ‘077”) based on the offer, distribution, use, possession and/or importation into Germany of certain network switches that the Company no longer sells in Germany. Orckit is seeking injunctive relief, accounting and sales information, and a declaration of liability for damages as well as costs of the lawsuit. On October 13, 2020, and the Court issued an infringement decision against the Company and granted to Orckit the right to enforce an injunction against the Company. The Company filed a notice of appeal on November 12, 2020 and the matter is proceeding through the appellate process. The Company filed a nullity action related to the EP ‘364 patent on May 3, 2018, and one related to the EP ‘077 patent on October 31, 2019. Both cases were filed in the Federal Patent Court in Munich and seek to invalidate the asserted patents. Both nullity actions are proceeding. The Company believes that all claims in both cases filed by Orckit are without merit and intends to defend them vigorously. Shenzhen Dunjun Technology Ltd. v. Aerohive Networks (Hangzhou) Ltd.; Aerohive Networks, Inc.; and Yunqing Information Technology (Shenzhen) Ltd. On June 20, 2019, Shenzhen Dunjun Technology Ltd. filed a patent infringement lawsuit against Aerohive Networks, Inc. (“Aerohive”), a Chinese subsidiary of the Company, and Yunqing Information Technology (Shenzhen) Ltd. in the Shenzhen Intermediate People’s Court in China. The lawsuit alleges infringement of a Chinese patent and seeks damages of RMB 10.0 million (USD $1.5 million). A first and second hearing in the trial were held and the Court subsequently ordered the parties to retain a third-party appraisal center to analyze and report to the Court on various technical aspects of the case and has set out the scope of the appraisal. The appraisal has not been conducted yet, and the Court has not issued a decision. The Company believes that the claims are without merit and intends to defend them vigorously. DataCloud Technologies, LLC. v. Extreme Networks, Inc. On June 5, 2020, DataCloud Technologies, LLC (“DataCloud”) filed a patent infringement lawsuit against the Company in the District of Delaware American Patents LLC v. Extreme Networks, Inc. On August 14, 2020, American Patents LLC filed a patent infringement lawsuit against the Company in the Western District of Texas. The complaint alleged direct and indirect infringement of certain U.S. patents and seeks injunctive relief, unspecified damages, on-going royalties, pre- and post-judgment interest, and attorneys’ fees. The parties have settled the case for a non-material amount, and the case was dismissed on November 16, 2020. SNMP Research, Inc. and SNMP Research International, Inc. v. Broadcom Inc., Brocade Communications Systems LLC, and Extreme Networks, Inc. On October 26, 2020, SNMP Research, Inc. and SNMP Research International, Inc. (collectively, “SNMP”) filed a lawsuit against the Company in the Eastern District of Tennessee for copyright infringement, alleging that the Company was not properly licensed to use their software. SNMP is seeking actual damages and profits attributed to the infringement, as well as equitable relief. Given the uncertainty of litigation and the preliminary stage of the case, Extreme cannot estimate at this time the possible loss or range of loss that may result from this action. Hanger Solutions, LLC v. Extreme Networks, Inc. On January 14, 2021, Hanger Solutions, LLC (“Hanger”) filed a patent infringement lawsuit against the Company in the District of Delaware. The complaint alleges infringement of three U.S. patents. Given the uncertainty of litigation and the preliminary stage of the case, Extreme cannot estimate at this time the possible loss or range of loss that may result from this action. Indemnification Obligations Subject to certain limitations, the Company may be obligated to indemnify its current and former directors, officers and employees. These obligations arise under the terms of its certificate of incorporation, its bylaws, applicable contracts, and applicable law. The obligation to indemnify, where applicable liabilities incurred in connection with certain legal matters. The Company also procures Directors and Officers liability insurance to help cover its defense and/or indemnification costs, although its ability to recover such costs through insurance is uncertain. While it is not possible to estimate the maximum potential amount that could be owed under these governing documents and agreements due to the Company’s limited history with prior indemnification claims, indemnification (including defense) costs could, in the future, have a material adverse effect on the Company’s consolidated financial position, results of operations and cash flows. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Stockholders' Equity | 10. Stockholders’ Equity Stockholders’ Rights Agreement On April 26, 2012, the Company entered into an Amended and Restated Rights Agreement between the Company and Computershare Shareholder Services LLC as the rights agent (as amended, the “Restated Rights Plan”). The Restated Rights Plan governs the terms of each right (“Right”) that has been issued with respect to each share of common stock of Extreme Networks. Each Right initially represents the right to purchase one one-thousandth of a share of the Company’s Preferred Stock. The Company’s Board of Directors (the “Board”) adopted the Restated Rights Plan to preserve the value of deferred tax assets, including net operating loss carry forwards of the Company, with respect to its ability to fully use its tax benefits to offset future income which may be limited if the Company experiences an “ownership change” for purposes of Section 382 of the Internal Revenue Code of 1986 as a result of ordinary buying and selling of shares of its common stock. Following its review of the terms of the plan, the Board decided it was necessary and in the best interests of the Company and its stockholders to enter into the Restated Rights Plan. Each year since 2013 the Board and stockholders have approved an amendment providing for a one-year extension of the term of the Restated Rights Plan. The Board unanimously approved an amendment to the Restated Rights Plan on May 8, 2020, to extend the Restated Rights Plan through May 31, 2021, which was ratified by the stockholders of the Company at the annual meeting of stockholders on November 5, 2020. Equity Incentive Plan The Board unanimously approved an amendment to the Extreme Networks, Inc. Amended and Restated 2013 Equity Incentive Plan (the “2013 Plan”) to increase the maximum number of available shares by 7.0 million shares. The amendment was approved by the stockholders at the Company’s annual meeting of stockholders held on November 7, 2019. Employee Stock Purchase Plan The Board unanimously approved an amendment to the 2014 Employee Stock Purchase Plan (the “ESPP”) to increase the maximum number of shares that will be available for sale thereunder by 7.5 million shares. The amendment was approved by the stockholders of the Company at the annual meeting of stockholders held on November 8, 2018. Common Stock Repurchases On November 2, 2018, the Company announced the Board had authorized management to repurchase up to $60.0 million of the Company’s common stock over a two-year period from the date of authorization. Purchases may be made from time to time through any means including, but not limited to, open market purchases and privately negotiated transactions. In February 2020, the Board increased the authorization to repurchase by $40.0 million to $100.0 million and extended the period for repurchase for three years from February 5, 2020. A maximum of $30.0 million of the Company’s common stock may be repurchased in any calendar year. There were no shares repurchased during the three and six months ended December 31, 2020. |
Employee Benefit Plans
Employee Benefit Plans | 6 Months Ended |
Dec. 31, 2020 | |
Share Based Compensation [Abstract] | |
Employee Benefit Plans | 11. Shares Reserved for Issuance The Company had the following reserved shares of common stock for future issuance as of the dates noted (in thousands): December 31, 2020 June 30, 2020 2013 Equity Incentive Plan shares available for grant 6,149 13,118 Employee stock options and awards outstanding 12,478 10,396 2014 Employee Stock Purchase Plan 5,913 7,364 Total shares reserved for issuance 24,540 30,878 Share-based Compensation Expense Share-based compensation expense recognized in the condensed consolidated financial statements by line item caption is as follows (in thousands): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Cost of product revenues $ 314 $ 402 $ 572 $ 652 Cost of service and subscription revenues 439 505 811 852 Research and development 2,694 3,260 4,966 5,695 Sales and marketing 3,239 3,511 5,886 7,230 General and administrative 3,409 2,801 6,162 4,884 Integration costs — 479 — 479 Total share-based compensation expense $ 10,095 $ 10,958 $ 18,397 $ 19,792 Stock Options The following table summarizes stock option activity for the six months ended December 31, 2020 (in thousands, except per share and contractual term): Number of Shares Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (years) Aggregate Intrinsic Value Options outstanding at June 30, 2020 2,922 $ 4.95 3.09 $ 1,688 Granted — — Exercised (19 ) 4.39 Cancelled (600 ) 5.30 Options outstanding at December 31, 2020 2,303 $ 4.87 3.33 $ 4,653 Vested and expected to vest at December 31, 2020 2,303 $ 4.87 3.33 $ 4,653 Exercisable at December 31, 2020 1,262 $ 3.50 1.89 $ 4,274 The fair value of each stock option grant under the 2013 Plan is estimated on the date of grant using the Black-Scholes-Merton option valuation model. The expected term of options granted is derived from historical data on employee exercise and post-vesting employment termination behavior. The risk-free rate is based upon the estimated life of the option and the U.S. Treasury yield curve in effect at the time of grant. Expected volatility is based on the historical volatility on the Company’s stock. There were no stock options granted during the six months ended December 31, 2020 Stock Awards Stock awards may be granted under the 2013 Plan on terms approved by the Compensation Committee of the Board. Stock awards generally provide for the issuance of restricted stock units (“RSUs”) including performance or market-condition RSUs which vest over a fixed period of time or based upon the satisfaction of certain performance criteria or market conditions. The Company recognizes compensation expense on the awards over the vesting period based on the awards’ fair value as of the date of grant. The Company does not estimate forfeitures, but accounts for them as incurred. The following table summarizes stock award activity for the six months ended December 31, 2020 (in thousands, except grant date fair value): Number of Shares Weighted- Average Grant Date Fair Value Aggregate Fair Market Value Non-vested stock awards outstanding at June 30, 2020 7,474 $ 6.83 Granted 5,703 4.70 Released (2,342 ) 7.24 Cancelled (660 ) 9.37 Non-vested stock awards outstanding at December 31, 2020 10,175 $ 5.37 $ 70,104 Vested and expected to vest at December 31, 2020 9,709 $ 5.32 $ 66,864 The RSU's granted under the 2013 plan vest over a period of time, generally one-to-three years, and are subject to participant's continued service to the Company . The stock awards granted during the six months ended December 31, 2020 included 1.6 million RSUs including the market condition awards discussed below to named executive officers and directors. Fiscal 2021 Awards On July 27, 2020, the Compensation Committee of the Board granted 0.5 million RSUs with vesting based on market conditions (“MSU”) to certain of the Company’s executive officers. These MSUs will vest based on the Company’s total shareholder return (“TSR”) relative to the TSR of the Russell 2000 Index (“Index”). The MSU award represents the right to receive a target number of shares of common stock up to 150% of the original grant. The MSUs vest based on the Company’s TSR relative to the TSR of the Index over performance periods from August 15, 2020 through August 15, 2023, subject to the grantees’ continued service through the certification of performance. Level Relative TSR Shares Vested Below Threshold TSR is less than the Index by more than 37.5 percentage points 0% Threshold TSR is less than the Index by 37.5 percentage points 25% Target TSR equals the Index 100% Maximum TSR is greater than the Index by 25 percentage points or more 150% Total shareholder return is calculated based on the average closing price for the 30-trading days prior to the beginning and end of the performance periods. Performance is measured based on three periods, with the ability for up to one-third of target shares to vest after years 1 and 2 and the ability for up to the maximum of the full award to vest based on the full 3-year TSR less any shares vested based on 1 and 2 year periods. Linear interpolation is used to determine the number of shares vested for achievement between target levels. The grant date fair value of each MSU was determined using the Monte-Carlo simulation model. The weighted-average grant-date fair value of these MSU was $5.32. The assumptions used in the Monte-Carlo simulation included the expected volatility of 69%, risk-free rate of 0.18%, no expected dividend yield, expected term of 3 years and possible future stock prices over the performance period based on the historical stock and market prices. The Company recognizes the expense related to these MSUs on a graded-vesting method over the estimated term. Fiscal 2018 and 2019 Awards During fiscal 2019 and 2018, the Company approved the grant of 0.6 million shares underlying stock awards each year in the form of restricted stock units with certain performance conditions (“PSUs”) to named executive officers and other vice president level employees. These PSUs would vest once the Company’s U.S. GAAP earnings aggregates at least $0.09 per share over two consecutive quarters exclusive of the PSU related share-based compensation expense (the “Performance Thresholds”). Upon satisfying the Performance Thresholds, the PSUs will vest with respect to the same number of RSUs that have vested which were granted on the same date and thereafter will vest on the same schedule as the RSUs, subject to continued service to the Company. If the Performance Thresholds are not met by the third anniversary of the grant date for each award, that award is canceled. The PSUs issued in fiscal 2018 expired and were cancelled during the three and six months ended December 31, 2020 without the achievement of the Performance Thresholds. During the three and six months ended December 31, 2020 and 2019 the Performance Thresholds for outstanding performance PSUs issued in fiscal 2019 were not deemed probable to be achieved, and as such, no compensation expense was recorded in either reporting period. Employee Stock Purchase Plan The fair value of each share purchase option under the ESPP is estimated on the date of grant using the Black-Scholes-Merton option valuation model with the weighted average assumptions noted in the following table. The expected term of the ESPP represents the term of the offering period of each option. The risk-free rate is based upon the estimated life and on the U.S. Treasury yield curve in effect at the time of grant. Expected volatility is based on the historical volatility on the Company’s stock. There were 1.5 million and 1.2 million shares issued under the ESPP during the six months ended December 31, 2020 and 2019, respectively. The following assumptions were used to determine the grant-date fair values of the ESPP shares during the following periods: Employee Stock Purchase Plan Six Months Ended December 31, 2020 December 31, 2019 Expected life 0.5 years 0.5 years Risk-free interest rate 0.12 % 1.85 % Volatility 119 % 43 % Dividend yield — % — % The weighted-average grant-date |
Information about Segments and
Information about Segments and Geographic Areas | 6 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Information about Segments and Geographic Areas | 1 2 . Information about Segments and Geographic Areas The Company operates in one segment, the development and marketing of network infrastructure equipment and related software. The Company conducts business globally and is managed geographically. Revenues are attributed to a geographical area based on the ship-to location of its customers. The Company operates in three geographical areas: Americas, which includes the United States, Canada, Mexico, Central America and South America; EMEA, which includes Europe, Russia, Middle East and Africa; and APAC which includes Asia Pacific, South Asia, India, Australia and Japan. The Company’s chief operating decision maker, who is its CEO, reviews financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance. See Note 3, Revenues, for the Company’s revenues by geographic regions and channel based on the customer’s ship-to location. The Company’s long-lived assets are attributed to the geographic regions as follows (in thousands): Long-lived Assets December 31, 2020 June 30, 2020 Americas $ 161,396 $ 177,443 EMEA 33,052 39,477 APAC 16,932 16,802 Total long-lived assets $ 211,380 $ 233,722 |
Derivatives and Hedging
Derivatives and Hedging | 6 Months Ended |
Dec. 31, 2020 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivatives and Hedging | 13. Derivatives and Hedging Interest Rate Swaps The Company is exposed to interest rate risk on its debt. The Company enters into interest rate swap contracts to effectively manage the impact of fluctuations of interest rate changes on its outstanding debt which has floating interest rate. The Company does not enter into derivative contracts for trading or speculative purposes. At the inception date of the derivative contract, the Company performs an assessment of these contracts and has designated these contracts as cash flow hedges. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreement without exchange of the underlying notional amount. The Company also formally assesses, both at the hedge’s inception and on an ongoing basis, by performing qualitative and quantitative assessment, whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in cash flow of hedged items. Changes in the fair value of a derivative that is qualified, designated and highly effective as a cash flow hedge are recorded in other comprehensive income (loss). When it is determined that a derivative is not highly effective as a hedge or that it has ceased to be a highly effective hedge, the Company discontinues hedge accounting prospectively. In accordance with ASC 815 “Derivatives and Hedging,” the Company may prospectively discontinue the hedge accounting for an existing hedge if the applicable criteria are no longer met, the derivative instrument expires, is sold, terminated or exercised or if the Company removes the designation of the respective cash flow hedge. In those circumstances, the net gain or loss remains in accumulated other comprehensive income (loss) and is reclassified into earnings in the same period or periods during which the hedged forecasted transaction affects earnings, unless the forecasted transaction is no longer probable in which case the net gain or loss is reclassified into earnings immediately. During fiscal 2020, the Company entered into multiple interest rate swap contracts, designated as cash flow hedges, to hedge the variability of cash flows in interest payments associated with the Company’s various tranches of floating-rate debt. As of December 31, 2020, the total notional amount of these interest rate swaps was $200.0 million and had maturity dates through April 2023 Foreign Exchange Forward Contracts The Company uses derivative financial instruments to manage exposures to foreign currency. The Company’s objective for holding derivatives is to use the most effective methods to minimize the impact of these exposures. The Company does not enter into derivatives for speculative or trading purposes. The fair value of the Company’s derivatives in a gain position are recorded in “Prepaid expenses and other current assets” and derivatives in a loss position are recorded in “Other accrued liabilities” in the accompanying condensed consolidated balance sheets. Changes in the fair value of derivatives are recorded in “Other income (expense), net” in the accompanying condensed consolidated statements of operations. The Company enters into foreign exchange forward contracts to mitigate the effect of gains and losses generated by foreign currency transactions related to certain operating expenses and re-measurement of certain assets and liabilities denominated in foreign currencies. These derivatives do not qualify as hedges. Unrealized gains recorded in the condensed consolidated statement of operations from these transactions during the three and six months ended December 31, 2020 were $0.1 million and $0.1 million, respectively. Realized gains and losses recorded in the condensed consolidated statement of operations from these transactions during the three and six months ended December 31, 2020 were $0.3 million and $0.4 million, respectively. There were no related gains and losses for the six months ended December 31, 2019 as the Company did not have any foreign exchange forward contracts at December 31, 2019. As of December 31, 2020, foreign exchange forward contracts had a notional principal amount of $22.7 million. These contracts have maturities of less than 40 days. Changes in the fair value of these foreign exchange forward contracts are offset largely by remeasurement of the underlying assets and liabilities. The Company recognized total foreign currency losses of $1.3 million and $0.8 million for the three months ended December 31, 2020 and 2019, respectively related to the change in fair value of foreign currency denominated assets and liabilities. The Company recognized total foreign currency losses of $2.4 million and $0.2 million for the six months ended December 31, 2020 and 2019, respectively related to the change in fair value of foreign currency denominated assets and liabilities. |
Restructuring Charges, Net of R
Restructuring Charges, Net of Reversals and Impairment, and Related Charges | 6 Months Ended |
Dec. 31, 2020 | |
Restructuring And Related Activities [Abstract] | |
Restructuring Charges, net of reversals, impairment, and related charges | 14. Restructuring Charges, Net of Reversals, Impairment, and Related Charges. The Company recorded $0.7 million and $1.7 million of restructuring charges, net of reversals and impairments during the three and six months ended December 31, 2020, respectively. Total restructuring charges included severance, benefits, and equipment relocation charges of $0.4 million and $1.1 million, as well as facility related charges of $0.3 million and $0.6 million for the three and six months ended December 31, 2020, respectively. Severance and benefit restructuring charges consisted primarily of additional employee severance and benefit expenses incurred under the reduction-in-force action initiated in the third quarter of fiscal 2020 (the “2020 Plan”) to reduce operating costs and enhance financial flexibility as a result of disruptions caused by the COVID-19 global pandemic. With the reduction and realignment of the headcount under the 2020 Plan, the Company is relocating certain of its lab test equipment to third-party consulting companies. The Company has incurred $9.2 million of charges under the 2020 Plan through December 31, 2020. The Company expects to incur additional equipment related relocation expenses of $0.8 million and expects to substantially complete these activities by the first half of fiscal 2022. The facility restructuring charges included additional facilities expenses related to previously impaired facilities. The Company recorded $6.6 million and $12.8 million of restructuring charges, net of reversals and impairment during the three and six months ended December 31, 2019, respectively. The charges included $3.9 million and $7.9 million, respectively, for the impairment of right-of-use assets related to facilities which the Company has exited, and $2.7 million and $4.9 million, respectively for and employee severance and benefit expenses incurred under the Company’s restructuring plans initiated in prior years which were completed as of the end of fiscal 2020. Restructuring liabilities related to severance, benefits, and equipment relocation obligations are recorded in “Other accrued liabilities” in the accompanying condensed consolidated balance sheets. The following table summarizes the activity related to the severance, benefits, and equipment relocation liabilities during the three and six months ended December 31, 2020 (in thousands): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Severance and Other Severance and Other Balance at beginning of period $ 302 $ 2,137 $ 2,219 $ 3,559 Period charges 475 3,284 1,247 5,879 Period reversals (78 ) (596 ) (128 ) (1,005 ) Period payments (518 ) (3,957 ) (3,157 ) (7,565 ) Balance at end of period $ 181 $ 868 $ 181 $ 868 |
Income Taxes
Income Taxes | 6 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 15. Income Taxes For the three months ended December 31, 2020 and 2019, the Company recorded an income tax provision of $1.8 million and $1.8 million, respectively. For the six months ended December 31, 2020 and 2019, the Company recorded an income tax provision of $3.1 and $3.4 million, respectively. The income tax provisions for the three and six months ended December 31, 2020 and 2019, consisted of (1) taxes on the income of the Company’s foreign subsidiaries, (2) foreign withholding taxes, (3) tax expense associated with the establishment of a U.S. deferred tax liability for amortizable goodwill resulting from the acquisition of Enterasys Networks, Inc., the wireless local area network business from Zebra Technologies Corporation, the Campus Fabric Business from Avaya and the Data Center Business from Brocade, and (4) state taxes in jurisdictions where the Company has no remaining state net operating losses (“NOLs”). The interim income tax provisions for the three and six months ended December 30, 2020 and 2019 were calculated using the discrete effective tax rate method as allowed by Accounting Standards Codification (“ASC”) 740-270-30-18, “Income Taxes – Interim Reporting.” The discrete method is applied when the application of the estimated annual effective tax rate is impractical because it is not possible to reliably estimate the annual effective tax rate. The discrete method treats the year to date period as if it was the annual period and determines the income tax expense or benefit on that basis. The Company believes that, at this time, the use of this discrete method is more appropriate than the annual effective tax rate method as (i) the estimated annual effective tax rate method is not reliable due to the high degree of uncertainty in estimating annual pretax earnings and (ii) the Company’s ongoing assessment that the recoverability of certain U.S. and Irish deferred tax assets is not more likely than not. On December 27,2020 the Consolidated Appropriations Act (“CAA”), 2021 was signed into law in the United States. Along with providing funding for normal government operations, the bill provides for additional COVID-19 focused relief in part, in the form of modification and extension of certain CARES Act provisions (discussed below) as well as modification and extension of other traditional tax provisions. The Company has reviewed the provisions of the CAA and has determined there is no material impact on the Company’s current or deferred tax position. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) was signed into law in the United States. The CARES Act, among other things, includes modifications to net operating loss carryforward provisions and the net interest expense deduction, and deferment of employer social security tax payments. The Company has evaluated the provisions of the CARES Act and how certain elections may impact its financial position and results of operations, and determined the enactment of the CARES Act did not have a material impact to the Company’s income tax provision for the three and six months ended December 31, 2020, or to the Company’s net deferred tax assets as of December 31, 2020 . The Company has provided a full valuation allowance against all of its U.S. federal and state deferred tax assets as well as a portion of the deferred tax assets in Ireland. A valuation allowance is determined by assessing both negative and positive evidence to determine whether it is “more likely than not” that deferred tax assets are recoverable; such assessment is required on a jurisdiction by jurisdiction basis. The Company's inconsistent earnings in recent periods, including a cumulative loss over the last three years, coupled with its difficulty in forecasting future revenue trends and the cyclical nature of its business represent sufficient negative evidence to require full valuation allowances against its U.S. federal and state net deferred tax assets as well as a portion of the deferred tax assets in Ireland. These valuation allowances will be evaluated periodically and can be reversed partially or in whole if business results and the economic environment have sufficiently improved to support realization of some or all of the Company's deferred tax assets. On August 9, 2019, the Company completed its acquisition of Aerohive. This acquisition was treated as a non-taxable stock acquisition and, therefore, Extreme Networks will have carryover tax basis in the assets and liabilities acquired. During the fourth quarter of fiscal 2020 following the acquisition of Aerohive, the Company realigned the Aerohive related non U.S. intellectual property rights to correspond with the Company’s global operating model. This transaction resulted in recognition of a $75.0 million U.S. tax gain which was fully consumed by existing NOLs and the intangibles transferred are being amortized over 10 years for Irish statutory purposes. The Company had $24.2 million of unrecognized tax benefits as of December 31, 2020. If fully recognized in the future, $0.5 million would impact the effective tax rate and $23.7 million, would result in adjustments to deferred tax assets and corresponding adjustments to the valuation allowance with no impact to the effective tax rate. The Company does not anticipate any events to occur during the next twelve months that would materially reduce the unrealized tax benefit as currently stated in the Company’s balance sheet. The Company’s policy is to accrue interest and penalties related to the underpayment of income taxes as a component of tax expense in the accompanying condensed consolidated statements of operations. In general, the Company’s U.S. federal income tax returns are subject to examination by tax authorities for fiscal years 2001 forward due to net operating losses and the Company's state income tax returns are subject to examination for fiscal years 2000 forward due to net operating losses. The Company is not currently under audit in any material jurisdictions. |
Net Loss Per Share
Net Loss Per Share | 6 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 16. Net Loss Per Share Basic net loss per share is calculated by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Dilutive income per share is calculated by dividing net income by the weighted average number of shares of common stock used in the basic net loss per share calculation plus the dilutive effect of shares subject to repurchase, options and unvested RSUs. The following table presents the calculation of net loss per share of basic and diluted (in thousands, except per share data): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Net loss $ (3,050 ) $ (23,538 ) $ (11,862 ) $ (61,276 ) Weighted-average shares used in per share calculation - basic and diluted 123,264 119,555 122,485 119,891 Net loss per share - basic and diluted $ (0.02 ) $ (0.20 ) $ (0.10 ) $ (0.51 ) The following securities were excluded from the computation of net loss per diluted share of common stock for the periods presented as their effect would have been anti-dilutive (in thousands): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Options to purchase common stock 2,156 3,177 2,345 3,037 Restricted stock units 9,553 10,378 9,003 9,862 Employee Stock Purchase Plan shares 1,324 1,500 1,040 1,500 Total shares excluded 13,033 15,055 12,388 14,399 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Fiscal Year | Fiscal Year The Company uses a fiscal calendar year ending on June 30. All references herein to “fiscal 2021” or “2021” represent the fiscal year ending June 30, 2021. All references herein to “fiscal 2020” or “2020” represent the fiscal year ended June 30, 2020. |
Principles of Consolidation | Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of Extreme and its wholly owned subsidiaries. All inter-company accounts and transactions have been eliminated. The Company predominantly uses the United States Dollar as its functional currency. The functional currency for certain of its foreign subsidiaries is the local currency. For those subsidiaries that operate in a local functional currency environment, all assets and liabilities are translated to United States Dollars at current month end rates of exchange and revenues and expenses are translated using the monthly average rate. |
Accounting Estimates | Accounting Estimates The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. |
Recently Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses The Company adopted the standard on July 1, 2020 and the impact of the adoption was not material to the Company's condensed consolidated financial statements as credit losses are not expected to be significant based on historical collection trends, the financial condition of payment partners, and external market factors . In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40 Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, Income taxes – Simplifying the Accounting for Income Taxes (Topic 740 Income Taxes and related disclosures |
Revenue Recognition | Revenue Recognition Performance Obligations. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in Topic 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Certain of the Company’s contracts have multiple performance obligations, as the promise to transfer individual goods or services is separately identifiable from other promises in the contracts and, therefore, is distinct. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation based on its relative standalone selling price. The stand-alone selling prices are determined based on the prices at which the Company separately sells these products. For items that are not sold separately, the Company estimates the stand-alone selling prices using other observable inputs. The Company’s performance obligations are satisfied at a point in time or over time as the customer receives and consumes the benefits provided. Substantially all of the Company’s product sales revenues are recognized at a point in time. Substantially all of the Company’s service, subscription, and SaaS revenues are recognized over time. For revenues recognized over time, the Company uses an input measure, days elapsed, to measure progress. On December 31, 2020 , the Company had $ 309.1 million of remaining performance obligations, which are primarily comprised of deferred maintenance and SaaS revenue s . The Company expects to recognize approximately percent of its deferred revenue as revenue in fiscal 2021 , an additional 34 percent in fiscal 2022 and 26 percent of the balance thereafter . Contract Balances. The timing of revenue recognition, billings and cash collections results in billed accounts receivable and deferred revenue in the condensed consolidated balance sheets. Services provided under renewable support arrangements of the Company are billed in accordance with agreed-upon contractual terms, which are either billed fully at the inception of contract or at periodic intervals (e.g., quarterly or annually). The Company sometimes receives payments from its customers in advance of services being provided, resulting in deferred revenues. These liabilities are reported on the condensed consolidated balance sheets on a contract-by-contract basis at the end of each reporting period. Revenue recognized for the three months ended December 31, 2020 and 2019 that was included in the deferred revenue balance at the beginning of each period was $68.8 million and $67.2 million, respectively. Revenue recognized for the six months ended December 31, 2020 and 2019 that was included in the deferred revenue balance at the beginning of each period was $120.5 million and $90.9 million, respectively. Contract Costs. The Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. Management expects that commission fees paid to sales representatives as a result of obtaining service contracts and contract renewals are recoverable and therefore the Company’s condensed consolidated balance sheets included capitalized balances in the amount of $9.2 million and $8.1 million at December 31, 2020 and June 30, 2020, respectively. Capitalized commission fees are amortized on a straight-line basis over the average period of service contracts of approximately three years, and are included in “Sales and marketing” in the accompanying condensed consolidated statements of operations. Amortization recognized during the three months ended December 31, 2020 and 2019, was $1.2 million and $1.5 million, respectively. Amortization recognized during the six months ended December 31, 2020 and 2019, was $2.5 million and $3.0 million, respectively. Estimated Variable Consideration. There were no material changes in the current period to the estimated variable consideration for performance obligations which were satisfied or partially satisfied during previous periods. Revenues by Category The following table sets forth the Company’s revenues disaggregated by sales channel and geographic region based on the customer’s ship-to locations (in thousands): Three Months Ended December 31, 2020 December 31, 2019 Distributor Direct Total Distributor Direct Total Americas: United States $ 46,506 $ 58,744 $ 105,250 $ 60,111 $ 61,622 $ 121,733 Other 8,950 3,648 12,598 8,204 5,563 13,767 Total Americas 55,456 62,392 117,848 68,315 67,185 135,500 EMEA 69,602 34,220 103,822 64,717 44,257 108,974 APAC 2,793 17,665 20,458 6,007 16,991 22,998 Total net revenues $ 127,851 $ 114,277 $ 242,128 $ 139,039 $ 128,433 $ 267,472 Six Months Ended December 31, 2020 December 31, 2019 Distributor Direct Total Distributor Direct Total Americas: United States $ 107,176 $ 116,091 $ 223,267 $ 130,089 $ 123,967 $ 254,056 Other 17,191 7,738 24,929 12,219 10,562 22,781 Total Americas 124,367 123,829 248,196 142,308 134,529 276,837 EMEA 117,131 67,796 184,927 123,846 73,891 197,737 APAC 7,844 36,963 44,807 15,120 33,284 48,404 Total net revenues $ 249,342 $ 228,588 $ 477,930 $ 281,274 $ 241,704 $ 522,978 For the three months ended December 31, 2020 the Company reflected 11% of its revenues from the Netherlands and 11% of its revenues from Germany. For the six months ended December 31, 2020 the Company reflected 10% of its revenues from the Netherlands and 10% of its revenue from Germany. No other foreign country accounted for 10% |
Inventories | Inventories The Company values its inventory at the lower of cost or net realizable value. Cost is computed using standard cost, which approximates actual cost, on a first-in, first-out basis. The Company adjusts the carrying value of its inventory when conditions exist that suggest that inventory may be in excess of anticipated demand or is obsolete based upon assumptions about future demand. At the point of the loss recognition, a new, lower-cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established cost basis. Any previously written down or obsolete inventory subsequently sold has not had a material impact on gross margin for any of the periods presented. Inventories consist of the following (in thousands): December 31, 2020 June 30, 2020 Finished goods $ 43,212 $ 52,879 Raw materials 6,618 9,710 Total Inventories $ 49,830 $ 62,589 |
Property and Equipment, Net | Property and Equipment, Net Property and equipment, net consist of the following (in thousands): December 31, 2020 June 30, 2020 Computers and equipment $ 75,882 $ 73,244 Purchased software 38,177 34,015 Office equipment, furniture and fixtures 10,779 10,639 Leasehold improvements 53,421 52,317 Total property and equipment 178,259 170,215 Less: accumulated depreciation and amortization (122,285 ) (111,402 ) Property and equipment, net $ 55,974 $ 58,813 |
Deferred Revenue | Deferred Revenue Deferred revenue represents amounts for deferred maintenance, support, SaaS, and other deferred revenue including professional services and training when the revenue recognition criteria have not been met. |
Guarantees and Product Warranties | Guarantees and Product Warranties The majority of the Company’s hardware products are shipped with either a one-year The following table summarizes the activity related to the Company’s product warranty liability during the three and six months ended December 31, 2020 and 2019 (in thousands): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Balance beginning of period $ 13,484 $ 15,988 $ 14,035 $ 14,779 Warranties assumed due to acquisitions — — — 570 New warranties issued 3,056 5,539 6,135 11,461 Warranty expenditures (3,467 ) (5,318 ) (7,097 ) (10,601 ) Balance end of period $ 13,073 $ 16,209 $ 13,073 $ 16,209 To facilitate sales of its products in the normal course of business, the Company indemnifies its resellers and end-user customers with respect to certain matters. The Company has agreed to hold the customer harmless against losses arising for intellectual property infringement and certain other losses. These agreements may limit the time within which an indemnification claim can be made and the amount of the claim. It is not possible to estimate the maximum potential amount under these indemnification agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. Historically, payments made by the Company under these agreements have not had a material impact on its operating results or financial position. |
Concentrations | Concentrations The Company may be subject to concentration of credit risk as a result of certain financial instruments consisting of accounts receivable. The Company does not invest an amount exceeding 10% of its combined cash and cash equivalents in the securities of any one obligor or maker, except for obligations of the United States government, obligations of United States government agencies and money market accounts. |
Earnings Per Share | Basic net loss per share is calculated by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Dilutive income per share is calculated by dividing net income by the weighted average number of shares of common stock used in the basic net loss per share calculation plus the dilutive effect of shares subject to repurchase, options and unvested RSUs. |
Revenues (Tables)
Revenues (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Revenue From Contract With Customer [Abstract] | |
Schedule of Revenues Disaggregated by Sales Channel and Geographic Region | The following table sets forth the Company’s revenues disaggregated by sales channel and geographic region based on the customer’s ship-to locations (in thousands): Three Months Ended December 31, 2020 December 31, 2019 Distributor Direct Total Distributor Direct Total Americas: United States $ 46,506 $ 58,744 $ 105,250 $ 60,111 $ 61,622 $ 121,733 Other 8,950 3,648 12,598 8,204 5,563 13,767 Total Americas 55,456 62,392 117,848 68,315 67,185 135,500 EMEA 69,602 34,220 103,822 64,717 44,257 108,974 APAC 2,793 17,665 20,458 6,007 16,991 22,998 Total net revenues $ 127,851 $ 114,277 $ 242,128 $ 139,039 $ 128,433 $ 267,472 Six Months Ended December 31, 2020 December 31, 2019 Distributor Direct Total Distributor Direct Total Americas: United States $ 107,176 $ 116,091 $ 223,267 $ 130,089 $ 123,967 $ 254,056 Other 17,191 7,738 24,929 12,219 10,562 22,781 Total Americas 124,367 123,829 248,196 142,308 134,529 276,837 EMEA 117,131 67,796 184,927 123,846 73,891 197,737 APAC 7,844 36,963 44,807 15,120 33,284 48,404 Total net revenues $ 249,342 $ 228,588 $ 477,930 $ 281,274 $ 241,704 $ 522,978 For the three months ended December 31, 2020 the Company reflected 11% of its revenues from the Netherlands and 11% of its revenues from Germany. For the six months ended December 31, 2020 the Company reflected 10% of its revenues from the Netherlands and 10% of its revenue from Germany. No other foreign country accounted for 10% |
Schedule of Customers Accounting for 10% or More of Net Revenues and Accounts Receivable Balance | The following table sets forth customers accounting for 10% or more of the Company’s net revenues for the periods indicated below: Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Tech Data Corporation 21% 14% 24% 15% Jenne Corporation 11% 18% 13% 16% Westcon Group Inc. 19% 15% 16% 13% The following table sets forth customers accounting for 10% or more of the Company’s accounts receivable balance: December 31, 2020 June 30, 2020 Tech Data Corporation 20% 23% Jenne Corporation 16% 25% Westcon Group Inc. 18% * * Less than 10% of accounts receivable. |
Business Combination (Tables)
Business Combination (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Aerohive Networks, Inc. | |
Summary of Unaudited Pro Forma Financial Information | The following table summarizes the unaudited pro forma financial information (in thousands, except per share amounts): Three Months Ended Six Months Ended December 31, 2019 December 31, 2019 Net revenues $ 268,367 $ 536,045 Net loss $ (5,031 ) $ (28,847 ) Net loss per share - basic and diluted $ (0.04 ) $ (0.24 ) Shares used in per share calculation - basic and diluted 119,555 119,891 |
Balance Sheet Accounts (Tables)
Balance Sheet Accounts (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Components of Inventories | Inventories consist of the following (in thousands): December 31, 2020 June 30, 2020 Finished goods $ 43,212 $ 52,879 Raw materials 6,618 9,710 Total Inventories $ 49,830 $ 62,589 |
Components of Property and Equipment | Property and equipment, net consist of the following (in thousands): December 31, 2020 June 30, 2020 Computers and equipment $ 75,882 $ 73,244 Purchased software 38,177 34,015 Office equipment, furniture and fixtures 10,779 10,639 Leasehold improvements 53,421 52,317 Total property and equipment 178,259 170,215 Less: accumulated depreciation and amortization (122,285 ) (111,402 ) Property and equipment, net $ 55,974 $ 58,813 |
Summary of Product Warranty Liability Activity | The following table summarizes the activity related to the Company’s product warranty liability during the three and six months ended December 31, 2020 and 2019 (in thousands): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Balance beginning of period $ 13,484 $ 15,988 $ 14,035 $ 14,779 Warranties assumed due to acquisitions — — — 570 New warranties issued 3,056 5,539 6,135 11,461 Warranty expenditures (3,467 ) (5,318 ) (7,097 ) (10,601 ) Balance end of period $ 13,073 $ 16,209 $ 13,073 $ 16,209 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value for Financial Assets and Liabilities Measured on Recurring Basis | The following table presents the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis at December 31, 2020 and June 30, 2020 (in thousands). December 31, 2020 Level 1 Level 2 Level 3 Total Assets Foreign currency derivatives $ — $ 127 $ — $ 127 Total assets measured at fair value $ — $ 127 $ — $ 127 Liabilities Foreign currency derivatives $ — $ 22 $ — $ 22 Interest rate swaps — 1,676 — 1,676 Acquisition-related contingent consideration obligations — — 1,168 1,168 Total liabilities measured at fair value $ — $ 1,698 $ 1,168 $ 2,866 June 30, 2020 Level 1 Level 2 Level 3 Total Liabilities Foreign currency derivatives $ — $ 8 $ — $ 8 Interest rate swaps — 1,769 — 1,769 Acquisition-related contingent consideration obligations — — 2,167 2,167 Total liabilities measured at fair value $ — $ 1,777 $ 2,167 $ 3,944 |
Schedule of Change in Acquisition-related Contingent Consideration Obligations | The change in the acquisition-related contingent consideration obligations is as follows (in thousands): Six Months Ended Six Months Ended December 31, 2020 December 31, 2019 Beginning balance 2,167 6,298 Payments (1,021 ) (2,206 ) Accretion on discount 22 60 Ending balance $ 1,168 $ 4,152 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Components of Gross and Net Intangible Asset Balances | The following tables summarize the components of gross and net intangible asset balances (dollars in thousands): Weighted Average Remaining Amortization Gross Carrying Accumulated Net Carrying Period Amount Amortization Amount December 31, 2020 Developed technology 2.1 years $ 156,100 $ 117,034 $ 39,066 Customer relationships 4.8 years 63,039 52,077 10,962 Backlog — years 400 400 — Trade names 1.0 years 10,700 9,407 1,293 License agreements 5.9 years 2,445 2,018 427 Other intangibles — years 1,382 1,382 — Total intangibles, net $ 234,066 $ 182,318 $ 51,748 Weighted Average Remaining Amortization Gross Accumulated Net Carrying Period Amount Amortization Amount June 30, 2020 Developed technology 2.4 years $ 156,100 $ 103,806 $ 52,294 Customer relationships 4.8 years 63,039 49,598 13,441 Backlog — years 400 400 — Trade names 1.4 years 10,700 8,554 2,146 License agreements 5.8 years 2,445 1,932 513 Other intangibles — years 1,382 1,382 — Total intangibles, net $ 234,066 $ 165,672 $ 68,394 |
Summary of Amortization Expense of Intangibles | The amortization expense of intangibles for the periods presented is summarized below (in thousands): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Amortization in “Cost of revenues: Product and Service and subscription” $ 6,649 $ 6,970 $ 13,348 $ 13,465 Amortization of intangibles in "Operations" 1,506 2,377 3,298 4,307 Total amortization expense $ 8,155 $ 9,347 $ 16,646 $ 17,772 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Components of Debt | The Company’s debt is comprised of the following (in thousands): December 31, 2020 June 30, 2020 Current portion of long-term debt: Term Loan $ 21,375 $ 19,000 Less: unamortized debt issuance costs (2,463 ) (2,484 ) Current portion of long-term debt $ 18,912 $ 16,516 Long-term debt, less current portion: Term Loan $ 334,875 $ 346,750 Revolving Facility — 55,000 Less: unamortized debt issuance costs (5,934 ) (7,165 ) Total long-term debt, less current portion 328,941 394,585 Total debt $ 347,853 $ 411,101 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Share Based Compensation [Abstract] | |
Common Stock Reserved for Future Issuance | The Company had the following reserved shares of common stock for future issuance as of the dates noted (in thousands): December 31, 2020 June 30, 2020 2013 Equity Incentive Plan shares available for grant 6,149 13,118 Employee stock options and awards outstanding 12,478 10,396 2014 Employee Stock Purchase Plan 5,913 7,364 Total shares reserved for issuance 24,540 30,878 |
Schedule of Recognized Share-based Compensation Expense | Share-based compensation expense recognized in the condensed consolidated financial statements by line item caption is as follows (in thousands): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Cost of product revenues $ 314 $ 402 $ 572 $ 652 Cost of service and subscription revenues 439 505 811 852 Research and development 2,694 3,260 4,966 5,695 Sales and marketing 3,239 3,511 5,886 7,230 General and administrative 3,409 2,801 6,162 4,884 Integration costs — 479 — 479 Total share-based compensation expense $ 10,095 $ 10,958 $ 18,397 $ 19,792 |
Summary of Stock Option Activity | The following table summarizes stock option activity for the six months ended December 31, 2020 (in thousands, except per share and contractual term): Number of Shares Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (years) Aggregate Intrinsic Value Options outstanding at June 30, 2020 2,922 $ 4.95 3.09 $ 1,688 Granted — — Exercised (19 ) 4.39 Cancelled (600 ) 5.30 Options outstanding at December 31, 2020 2,303 $ 4.87 3.33 $ 4,653 Vested and expected to vest at December 31, 2020 2,303 $ 4.87 3.33 $ 4,653 Exercisable at December 31, 2020 1,262 $ 3.50 1.89 $ 4,274 |
Summary of Stock Award Activity | The following table summarizes stock award activity for the six months ended December 31, 2020 (in thousands, except grant date fair value): Number of Shares Weighted- Average Grant Date Fair Value Aggregate Fair Market Value Non-vested stock awards outstanding at June 30, 2020 7,474 $ 6.83 Granted 5,703 4.70 Released (2,342 ) 7.24 Cancelled (660 ) 9.37 Non-vested stock awards outstanding at December 31, 2020 10,175 $ 5.37 $ 70,104 Vested and expected to vest at December 31, 2020 9,709 $ 5.32 $ 66,864 |
Schedule of Awards Performance Thresholds and Shares Expected to Vest (TSR PSUs) | The MSU award represents the right to receive a target number of shares of common stock up to 150% of the original grant. The MSUs vest based on the Company’s TSR relative to the TSR of the Index over performance periods from August 15, 2020 through August 15, 2023, subject to the grantees’ continued service through the certification of performance. Level Relative TSR Shares Vested Below Threshold TSR is less than the Index by more than 37.5 percentage points 0% Threshold TSR is less than the Index by 37.5 percentage points 25% Target TSR equals the Index 100% Maximum TSR is greater than the Index by 25 percentage points or more 150% |
Schedule of Fair Value Assumptions for Employee Stock Purchase Plan Awards | The following assumptions were used to determine the grant-date fair values of the ESPP shares during the following periods: Employee Stock Purchase Plan Six Months Ended December 31, 2020 December 31, 2019 Expected life 0.5 years 0.5 years Risk-free interest rate 0.12 % 1.85 % Volatility 119 % 43 % Dividend yield — % — % |
Information about Segments an_2
Information about Segments and Geographic Areas (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Long Lived Assets by Segment | The Company’s long-lived assets are attributed to the geographic regions as follows (in thousands): Long-lived Assets December 31, 2020 June 30, 2020 Americas $ 161,396 $ 177,443 EMEA 33,052 39,477 APAC 16,932 16,802 Total long-lived assets $ 211,380 $ 233,722 |
Restructuring Charges, Net of_2
Restructuring Charges, Net of Reversals and Impairment, and Related Charges (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Restructuring And Related Activities [Abstract] | |
Restructuring Liabilities | Restructuring liabilities related to severance, benefits, and equipment relocation obligations are recorded in “Other accrued liabilities” in the accompanying condensed consolidated balance sheets. The following table summarizes the activity related to the severance, benefits, and equipment relocation liabilities during the three and six months ended December 31, 2020 (in thousands): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Severance and Other Severance and Other Balance at beginning of period $ 302 $ 2,137 $ 2,219 $ 3,559 Period charges 475 3,284 1,247 5,879 Period reversals (78 ) (596 ) (128 ) (1,005 ) Period payments (518 ) (3,957 ) (3,157 ) (7,565 ) Balance at end of period $ 181 $ 868 $ 181 $ 868 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table presents the calculation of net loss per share of basic and diluted (in thousands, except per share data): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Net loss $ (3,050 ) $ (23,538 ) $ (11,862 ) $ (61,276 ) Weighted-average shares used in per share calculation - basic and diluted 123,264 119,555 122,485 119,891 Net loss per share - basic and diluted $ (0.02 ) $ (0.20 ) $ (0.10 ) $ (0.51 ) |
Schedule of Antidilutive Securities Excluded from Earnings Per Share Calculation | The following securities were excluded from the computation of net loss per diluted share of common stock for the periods presented as their effect would have been anti-dilutive (in thousands): Three Months Ended Six Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Options to purchase common stock 2,156 3,177 2,345 3,037 Restricted stock units 9,553 10,378 9,003 9,862 Employee Stock Purchase Plan shares 1,324 1,500 1,040 1,500 Total shares excluded 13,033 15,055 12,388 14,399 |
Revenues (Narratives) (Details)
Revenues (Narratives) (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2020USD ($)Distribution_Channels | Dec. 31, 2019USD ($) | Jun. 30, 2020USD ($) | |
Disaggregation Of Revenue [Line Items] | |||||
Number of distribution channels | Distribution_Channels | 2 | ||||
Estimated selling price determination approach | Certain of the Company’s contracts have multiple performance obligations, as the promise to transfer individual goods or services is separately identifiable from other promises in the contracts and, therefore, is distinct. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation based on its relative standalone selling price. The stand-alone selling prices are determined based on the prices at which the Company separately sells these products. For items that are not sold separately, the Company estimates the stand-alone selling prices using other observable inputs. | ||||
Remaining revenue performance obligations | $ 309.1 | $ 309.1 | |||
Revenue recognized for deferred revenue balance | $ 68.8 | $ 67.2 | $ 120.5 | $ 90.9 | |
Netherlands | |||||
Disaggregation Of Revenue [Line Items] | |||||
Concentration risk (percent) | 11.00% | 10.00% | |||
Germany | |||||
Disaggregation Of Revenue [Line Items] | |||||
Concentration risk (percent) | 11.00% | 10.00% | |||
Other Foreign Country | |||||
Disaggregation Of Revenue [Line Items] | |||||
Concentration risk (percent) | 10.00% | 10.00% | 10.00% | 10.00% | |
Commission Fees | |||||
Disaggregation Of Revenue [Line Items] | |||||
Revenue, practical expedient, incremental cost of obtaining contract [true false] | true | ||||
Contract costs capitalized, balances amount | $ 9.2 | $ 9.2 | $ 8.1 | ||
Contract costs capitalized, amortization period | 3 years | 3 years | |||
Contract costs capitalized, amortization method | straight-line basis | ||||
Contract costs capitalized, amortization expense | $ 1.2 | $ 1.5 | $ 2.5 | $ 3 |
Revenues (Narratives) (Details
Revenues (Narratives) (Details 1) | 6 Months Ended |
Dec. 31, 2020 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-07-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Percentage of remaining performance obligations expected to recognize, period | 1 year |
Percentage of remaining performance obligations expected to recognize | 40.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-07-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Percentage of remaining performance obligations expected to recognize, period | 1 year |
Percentage of remaining performance obligations expected to recognize | 34.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-07-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Percentage of remaining performance obligations expected to recognize, period | 1 year |
Percentage of remaining performance obligations expected to recognize, description | thereafter |
Percentage of remaining performance obligations expected to recognize | 26.00% |
Revenues (Schedule of Revenues
Revenues (Schedule of Revenues Disaggregated by Sales Channel and Geographic Region) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | $ 242,128 | $ 267,472 | $ 477,930 | $ 522,978 |
Distributor | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 127,851 | 139,039 | 249,342 | 281,274 |
Direct | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 114,277 | 128,433 | 228,588 | 241,704 |
United States | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 105,250 | 121,733 | 223,267 | 254,056 |
United States | Distributor | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 46,506 | 60,111 | 107,176 | 130,089 |
United States | Direct | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 58,744 | 61,622 | 116,091 | 123,967 |
Other Americas | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 12,598 | 13,767 | 24,929 | 22,781 |
Other Americas | Distributor | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 8,950 | 8,204 | 17,191 | 12,219 |
Other Americas | Direct | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 3,648 | 5,563 | 7,738 | 10,562 |
Total Americas | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 117,848 | 135,500 | 248,196 | 276,837 |
Total Americas | Distributor | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 55,456 | 68,315 | 124,367 | 142,308 |
Total Americas | Direct | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 62,392 | 67,185 | 123,829 | 134,529 |
EMEA | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 103,822 | 108,974 | 184,927 | 197,737 |
EMEA | Distributor | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 69,602 | 64,717 | 117,131 | 123,846 |
EMEA | Direct | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 34,220 | 44,257 | 67,796 | 73,891 |
APAC | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 20,458 | 22,998 | 44,807 | 48,404 |
APAC | Distributor | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | 2,793 | 6,007 | 7,844 | 15,120 |
APAC | Direct | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net Revenues | $ 17,665 | $ 16,991 | $ 36,963 | $ 33,284 |
Revenues (Schedule of Customers
Revenues (Schedule of Customers Accounting for 10% or More of Net Revenues and Accounts Receivable Balance) (Details) - Customer Concentration Risk | 3 Months Ended | 6 Months Ended | ||||
Dec. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Westcon Group Inc. | Net Revenue | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk (percent) | 19.00% | 15.00% | 16.00% | 13.00% | ||
Westcon Group Inc. | Accounts Receivable | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk (percent) | 18.00% | 0.00% | [1] | |||
Jenne Corporation | Net Revenue | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk (percent) | 11.00% | 18.00% | 13.00% | 16.00% | ||
Jenne Corporation | Accounts Receivable | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk (percent) | 16.00% | 25.00% | ||||
Tech Data Corporation | Net Revenue | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk (percent) | 21.00% | 14.00% | 24.00% | 15.00% | ||
Tech Data Corporation | Accounts Receivable | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk (percent) | 20.00% | 23.00% | ||||
[1] | * Less than 10% of accounts receivable. |
Business Combination (Narrative
Business Combination (Narratives) (Details) - USD ($) $ in Thousands | Aug. 09, 2019 | Dec. 31, 2020 | Jun. 30, 2020 |
Business Acquisition [Line Items] | |||
Goodwill | $ 331,159 | $ 331,159 | |
Aerohive Networks, Inc. | |||
Business Acquisition [Line Items] | |||
Business acquisition, cash consideration | $ 267,100 | ||
Business acquisition, date of acquisition | Aug. 9, 2019 | ||
Goodwill | $ 192,600 | ||
Identifiable intangible assets | $ 52,500 |
Business Combinations (Summary
Business Combinations (Summary of Unaudited Pro Forma Financial Information) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended |
Dec. 31, 2019 | Dec. 31, 2019 | |
Business Acquisition Pro Forma Information [Abstract] | ||
Net revenues | $ 268,367 | $ 536,045 |
Net loss | $ (5,031) | $ (28,847) |
Net loss per share - basic and diluted | $ (0.04) | $ (0.24) |
Shares used in per share calculation - basic and diluted | 119,555 | 119,891 |
Balance Sheet Accounts (Compone
Balance Sheet Accounts (Components of Inventories) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ||
Finished goods | $ 43,212 | $ 52,879 |
Raw materials | 6,618 | 9,710 |
Total Inventories | $ 49,830 | $ 62,589 |
Balance Sheet Accounts (Compo_2
Balance Sheet Accounts (Components of Property and Equipment) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 178,259 | $ 170,215 |
Less: accumulated depreciation and amortization | (122,285) | (111,402) |
Property and equipment, net | 55,974 | 58,813 |
Computers and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 75,882 | 73,244 |
Purchased software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 38,177 | 34,015 |
Office equipment, furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 10,779 | 10,639 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 53,421 | $ 52,317 |
Balance Sheet Accounts (Narrati
Balance Sheet Accounts (Narratives) (Details) | 6 Months Ended |
Dec. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Standard hardware warranty period (in months) | 1 year |
Standard software warranty period (in days) | 90 days |
Maximum investment in one obligor or maker (percent) | 10.00% |
Balance Sheet Accounts (Summary
Balance Sheet Accounts (Summary of Product Warranty Liability Activity) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||||
Balance beginning of period | $ 13,484 | $ 15,988 | $ 14,035 | $ 14,779 |
Warranties assumed due to acquisitions | 570 | |||
New warranties issued | 3,056 | 5,539 | 6,135 | 11,461 |
Warranty expenditures | (3,467) | (5,318) | (7,097) | (10,601) |
Balance end of period | $ 13,073 | $ 16,209 | $ 13,073 | $ 16,209 |
Fair Value Measurements (Schedu
Fair Value Measurements (Schedule of Fair Value for Financial Assets and Liabilities Measured on Recurring Basis) (Details) - Recurring - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Assets | ||
Foreign currency derivatives | $ 127 | |
Total assets measured at fair value | 127 | |
Liabilities | ||
Foreign currency derivatives | 22 | $ 8 |
Interest rate swaps | 1,676 | 1,769 |
Acquisition-related contingent consideration obligations | 1,168 | 2,167 |
Total liabilities measured at fair value | 2,866 | 3,944 |
Level 2 | ||
Assets | ||
Foreign currency derivatives | 127 | |
Total assets measured at fair value | 127 | |
Liabilities | ||
Foreign currency derivatives | 22 | 8 |
Interest rate swaps | 1,676 | 1,769 |
Total liabilities measured at fair value | 1,698 | 1,777 |
Level 3 | ||
Liabilities | ||
Acquisition-related contingent consideration obligations | 1,168 | 2,167 |
Total liabilities measured at fair value | $ 1,168 | $ 2,167 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narratives) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Dec. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | |
Assets/Liabilities | ||||||
Unrealized Gain (Loss) on Derivatives | $ 120,000 | $ 293,000 | ||||
Forward Foreign Currency Contracts | ||||||
Assets/Liabilities | ||||||
Gain (Loss) on Sale of Derivatives | 100,000 | 100,000 | ||||
Unrealized Gain (Loss) on Derivatives | 300,000 | 400,000 | ||||
Interest rate swap contracts | ||||||
Assets/Liabilities | ||||||
Notional principal amount of forward foreign exchange contracts | 200,000,000 | $ 200,000,000 | 200,000,000 | |||
Other Comprehensive Income (Loss) | Interest rate swap contracts | ||||||
Assets/Liabilities | ||||||
Unrealized loss on interest rate cash flow hedges | (1,800,000) | (1,700,000) | ||||
Not Designated as Hedging Instrument | Forward Foreign Currency Contracts | ||||||
Assets/Liabilities | ||||||
Notional principal amount of forward foreign exchange contracts | 22,700,000 | $ 4,000,000 | $ 22,700,000 | |||
Maximum maturities for contracts | 40 days | 40 days | ||||
Gain (loss) on foreign currency derivative instruments | $ 0 | $ 0 | ||||
Not Designated as Hedging Instrument | Forward Foreign Currency Contracts | ||||||
Assets/Liabilities | ||||||
Notional principal amount of forward foreign exchange contracts | 22,700,000 | $ 22,700,000 | ||||
Maximum maturities for contracts | 40 days | |||||
Level 2 Assets and Liabilities | ||||||
Assets/Liabilities | ||||||
Long-term debt, fair value | 356,300,000 | $ 420,800,000 | $ 356,300,000 | |||
Transfers of assets between Level 1 and Level 2 | 0 | 0 | 0 | 0 | ||
Transfers of liabilities between Level 1 and Level 2 | 0 | 0 | 0 | 0 | ||
Level 3 Assets and Liabilities | ||||||
Assets/Liabilities | ||||||
Acquisition-related contingent consideration obligations | 1,168,000 | $ 2,167,000 | 4,152,000 | 1,168,000 | 4,152,000 | $ 6,298,000 |
Transfers of assets between Level 2 and Level 3 | 0 | 0 | 0 | 0 | ||
Transfers of liabilities between Level 2 and Level 3 | 0 | 0 | 0 | 0 | ||
Fair value assets impairment | $ 0 | $ 0 | $ 0 | $ 0 |
Fair Value Measurements (Sche_2
Fair Value Measurements (Schedule of Change in Acquisition-related Contingent Consideration Obligations) (Details) - Level 3 Assets and Liabilities - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Business Acquisition Contingent Consideration [Line Items] | ||
Beginning balance | $ 2,167 | $ 6,298 |
Payments | (1,021) | (2,206) |
Accretion on discount | 22 | 60 |
Ending balance | $ 1,168 | $ 4,152 |
Intangible Assets (Components o
Intangible Assets (Components of Gross and Net Intangible Asset Balances) (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Dec. 31, 2020 | Jun. 30, 2020 | |
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 234,066 | $ 234,066 |
Accumulated Amortization | 182,318 | 165,672 |
Net Carrying Amount | $ 51,748 | $ 68,394 |
Developed technology | ||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Amortization Period | 2 years 1 month 6 days | 2 years 4 months 24 days |
Gross Carrying Amount | $ 156,100 | $ 156,100 |
Accumulated Amortization | 117,034 | 103,806 |
Net Carrying Amount | $ 39,066 | $ 52,294 |
Customer relationships | ||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Amortization Period | 4 years 9 months 18 days | 4 years 9 months 18 days |
Gross Carrying Amount | $ 63,039 | $ 63,039 |
Accumulated Amortization | 52,077 | 49,598 |
Net Carrying Amount | $ 10,962 | $ 13,441 |
Backlogs | ||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Amortization Period | 0 years | 0 years |
Gross Carrying Amount | $ 400 | $ 400 |
Accumulated Amortization | $ 400 | $ 400 |
Trade names | ||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Amortization Period | 1 year | 1 year 4 months 24 days |
Gross Carrying Amount | $ 10,700 | $ 10,700 |
Accumulated Amortization | 9,407 | 8,554 |
Net Carrying Amount | $ 1,293 | $ 2,146 |
License agreements | ||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Amortization Period | 5 years 10 months 24 days | 5 years 9 months 18 days |
Gross Carrying Amount | $ 2,445 | $ 2,445 |
Accumulated Amortization | 2,018 | 1,932 |
Net Carrying Amount | $ 427 | $ 513 |
Other intangibles | ||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Amortization Period | 0 years | 0 years |
Gross Carrying Amount | $ 1,382 | $ 1,382 |
Accumulated Amortization | $ 1,382 | $ 1,382 |
Intangible Assets (Summary of A
Intangible Assets (Summary of Amortization Expense of Intangibles) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||||
Amortization in “Cost of revenues: Product and Service and subscription” | $ 6,649 | $ 6,970 | $ 13,348 | $ 13,465 |
Type Of Cost Good Or Service Extensible List | us-gaap:ProductMember | us-gaap:ProductMember | us-gaap:ProductMember | us-gaap:ProductMember |
Amortization of intangibles in "Operations" | $ 1,506 | $ 2,377 | $ 3,298 | $ 4,307 |
Total amortization expense | $ 8,155 | $ 9,347 | $ 16,646 | $ 17,772 |
Debt (Components of Debt) (Deta
Debt (Components of Debt) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Line Of Credit Facility [Line Items] | ||
Less: unamortized debt issuance costs | $ (2,463) | $ (2,484) |
Current portion of long-term debt | 18,912 | 16,516 |
Less: unamortized debt issuance costs | (5,934) | (7,165) |
Long-term debt, less current portion | 328,941 | 394,585 |
Total debt | 347,853 | 411,101 |
Term Loan | ||
Line Of Credit Facility [Line Items] | ||
Current portion of long-term debt | 21,375 | 19,000 |
Long-term debt, less current portion | $ 334,875 | 346,750 |
Revolving Facility | ||
Line Of Credit Facility [Line Items] | ||
Long-term debt, less current portion | $ 55,000 |
Debt (Narratives) (Details)
Debt (Narratives) (Details) - USD ($) | Aug. 09, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Nov. 03, 2020 | Jun. 30, 2020 | May 08, 2020 |
Line Of Credit Facility [Line Items] | ||||||||
Outstanding letters of credit | $ 8,800,000 | $ 8,800,000 | ||||||
Interest Expense | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Amortization of deferred financing costs | 800,000 | $ 700,000 | $ 1,500,000 | $ 1,100,000 | ||||
2019 Credit Agreement | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Deferred financing cost | $ 10,500,000 | |||||||
Amortization of deferred financing costs | $ 1,600,000 | |||||||
Debt instrument interest rate | 4.65% | |||||||
2019 Credit Agreement | First Amendment | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Amendment start date | Apr. 8, 2020 | |||||||
2019 Credit Agreement | Second Amendment | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Amendment start date | May 8, 2020 | |||||||
2019 Credit Agreement | Third Amendment | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Amendment start date | Nov. 3, 2020 | |||||||
Line of credit sublimit for letters of credit | $ 20,000,000 | |||||||
2019 Credit Agreement | Fourth Amendment | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Amendment start date | Dec. 8, 2020 | |||||||
2019 Credit Agreement | Term Loan | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Credit Facility, term | 5 years | |||||||
Borrowing capacity from Credit Agreement | $ 380,000,000 | |||||||
2019 Credit Agreement | Revolving Facility | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Credit Facility, term | 5 years | |||||||
Borrowing capacity from Credit Agreement | $ 75,000,000 | 55,000,000 | $ 55,000,000 | |||||
Repayments of Lines of Credit | 55,000,000 | |||||||
Line of credit facility remaining outstanding balance | 0 | 0 | ||||||
Borrowing capacity from Credit Agreement | $ 55,000,000 | $ 55,000,000 | ||||||
2019 Credit Agreement | Revolving Facility | Second Amendment | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Borrowing capacity from Credit Agreement | $ 55,000,000 | |||||||
2019 Credit Agreement | Revolving Facility | Applicable Margin for Eurodollar | Second Amendment | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Euro dollar rate | 4.50% | |||||||
Initial Term Loan | Revolving Facility | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Base rate | 0.00% | |||||||
Commitment fee | 0.40% | |||||||
Amendments | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Deferred financing cost | $ 1,500,000 | |||||||
Maximum | 2019 Credit Agreement | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Additional incremental loan facility that may be requested | $ 100,000,000 | |||||||
Maximum | Initial Term Loan | Applicable Margin for Eurodollar | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Borrowings, interest rate | 3.50% | |||||||
Maximum | Initial Term Loan | Applicable Margin for Base Rate | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Borrowings, interest rate | 2.50% | |||||||
Maximum | Initial Term Loan | Revolving Facility | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Commitment fee | 0.40% | |||||||
Minimum | Initial Term Loan | Applicable Margin for Eurodollar | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Borrowings, interest rate | 1.25% | |||||||
Minimum | Initial Term Loan | Applicable Margin for Base Rate | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Borrowings, interest rate | 0.25% | |||||||
Minimum | Initial Term Loan | Revolving Facility | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Commitment fee | 0.25% |
Commitments and Contingencies (
Commitments and Contingencies (Narratives) (Details) ¥ in Millions | Jan. 14, 2021USD ($) | Nov. 13, 2020USD ($) | Jun. 05, 2020USD ($) | Jun. 20, 2019USD ($) | Jun. 20, 2019CNY (¥) | Dec. 31, 2020USD ($) |
Shenzhen Dunjun Technology Ltd. v. Aerohive Networks (Hangzhou) Ltd | ||||||
Commitments And Contingencies [Line Items] | ||||||
Damages claims amount | $ 1,500,000 | ¥ 10 | ||||
Hanger Solutions, LLC v. Extreme Networks, Inc | Subsequent Event | ||||||
Commitments And Contingencies [Line Items] | ||||||
Number of patents allegedly infringed | 3 | |||||
DataCloud Technologies L L C V Extreme Networks Inc | ||||||
Commitments And Contingencies [Line Items] | ||||||
Number of patents allegedly infringed | 4 | 4 | ||||
Inventory Purchase Commitments | ||||||
Commitments And Contingencies [Line Items] | ||||||
Non-cancelable purchase commitments | $ 38,000,000 |
Stockholders' Equity (Narrative
Stockholders' Equity (Narratives) (Details) - USD ($) | Feb. 05, 2020 | Nov. 07, 2019 | Nov. 08, 2018 | Dec. 31, 2020 | Dec. 31, 2020 | Nov. 02, 2018 |
Class Of Stock [Line Items] | ||||||
Stock repurchase, authorized amount | $ 100,000,000 | $ 60,000,000 | ||||
Maximum amount of common stock may be repurchased in calendar year | 30,000,000 | |||||
Stock repurchase, increase in authorized amount | $ 40,000,000 | |||||
Stock repurchase, extended period | 3 years | |||||
Stock repurchase, extended period, effective date | Feb. 5, 2020 | |||||
Total number of shares repurchased | 0 | 0 | ||||
2013 Equity Incentive Plan | ||||||
Class Of Stock [Line Items] | ||||||
Increase in authorized shares for issuance | 7,000,000 | |||||
2014 Employee Stock Purchase Plan | ||||||
Class Of Stock [Line Items] | ||||||
Increase in authorized shares for issuance | 7,500,000 |
Employee Benefit Plans (Common
Employee Benefit Plans (Common Stock Reserved for Future Issuance) (Details) - shares shares in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Class Of Stock [Line Items] | ||
Shares reserved for issuance | 24,540 | 30,878 |
2014 Employee Stock Purchase Plan | ||
Class Of Stock [Line Items] | ||
Shares reserved for issuance | 5,913 | 7,364 |
Employee Stock Options and Awards Outstanding | ||
Class Of Stock [Line Items] | ||
Shares reserved for issuance | 12,478 | 10,396 |
2013 Equity Incentive Plan Shares Available for Grant | ||
Class Of Stock [Line Items] | ||
Shares reserved for issuance | 6,149 | 13,118 |
Employee Benefit Plans (Schedul
Employee Benefit Plans (Schedule of Recognized Share-based Compensation Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense | $ 10,095 | $ 10,958 | $ 18,397 | $ 19,792 |
Cost of Product Revenue | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense | 314 | 402 | 572 | 652 |
Cost of Service and Subscription Revenues | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense | 439 | 505 | 811 | 852 |
Research and Development | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense | 2,694 | 3,260 | 4,966 | 5,695 |
Sales and Marketing | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense | 3,239 | 3,511 | 5,886 | 7,230 |
General and Administrative | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense | $ 3,409 | 2,801 | $ 6,162 | 4,884 |
Integration Costs | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense | $ 479 | $ 479 |
Employee Benefit Plans (Summary
Employee Benefit Plans (Summary of Stock Option Activity) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 6 Months Ended | 12 Months Ended |
Dec. 31, 2020 | Jun. 30, 2020 | |
Number of Shares | ||
Options outstanding at June 30, 2020 | 2,922 | |
Exercised | (19) | |
Cancelled | (600) | |
Options outstanding at December 31, 2020 | 2,303 | 2,922 |
Vested and expected to vest at December 31, 2020 | 2,303 | |
Exercisable at December 31, 2020 | 1,262 | |
Weighted-Average Exercise Price Per Share | ||
Options outstanding at June 30, 2020 | $ 4.95 | |
Exercised | 4.39 | |
Cancelled | 5.30 | |
Options outstanding at December 31, 2020 | 4.87 | $ 4.95 |
Vested and expected to vest at December 31, 2020 | 4.87 | |
Exercisable at December 31, 2020 | $ 3.50 | |
Weighted-Average Remaining Contractual Term | ||
Options outstanding | 3 years 3 months 29 days | 3 years 1 month 2 days |
Vested and expected to vest at December 31, 2020 | 3 years 3 months 29 days | |
Exercisable at December 31, 2020 | 1 year 10 months 20 days | |
Aggregate Intrinsic Value | ||
Options outstanding | $ 4,653 | $ 1,688 |
Vested and expected to vest at December 31, 2020 | 4,653 | |
Exercisable at December 31, 2020 | $ 4,274 |
Employee Benefit Plans (Narrati
Employee Benefit Plans (Narratives) (Details) | Jul. 27, 2020shares | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | Jun. 30, 2019Quartershares | Jun. 30, 2018shares |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Weighted-average grant-date fair value of options granted (in dollars per share) | $ / shares | $ 3.52 | ||||
Granted | 5,703,000 | ||||
Granted | $ / shares | $ 4.70 | ||||
Restricted Stock Units (RSUs) | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Share-based compensation arrangement by share-based payment award, award vesting percentage | The RSU's granted under the 2013 plan vest over a period of time, generally one-to-three years, and are subject to participant's continued service to the Company. | ||||
MSU | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Calculation of total shareholder return (TSR), description | Total shareholder return is calculated based on the average closing price for the 30-trading days prior to the beginning and end of the performance periods. Performance is measured based on three periods, with the ability for up to one-third of target shares to vest after years 1 and 2 and the ability for up to the maximum of the full award to vest based on the full 3-year TSR less any shares vested based on 1 and 2 year periods. | ||||
Granted | $ / shares | $ 5.32 | ||||
Volatility | 69.00% | ||||
Risk-free interest rate | 0.18% | ||||
Dividend yield | 0.00% | ||||
Expected life | 3 years | ||||
Performance Shares | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Performance stock unit vesting, consecutive quarters | Quarter | 2 | ||||
Share-based compensation expense | $ | $ 0 | $ 0 | |||
Performance Shares | Minimum | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Performance stock unit vesting, earnings per share | $ / shares | $ 0.09 | ||||
Executive Officers and Directors | Restricted Stock Units (RSUs) | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Granted | 1,600,000 | ||||
Executive Officer Member | MSU | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Granted | 500,000 | ||||
Shares vested, Maximum | 150.00% | ||||
Executive Officers And Other Vice President Level Employee | Performance Shares | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Granted | 600,000 | 600,000 | |||
2013 Equity Incentive Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Granted | 0 | ||||
2014 Employee Stock Purchase Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Weighted-average grant-date fair value of options granted (in dollars per share) | $ / shares | $ 2.23 | $ 2.02 | |||
Shares issued under stock purchase plan | 1.5 | 1.2 |
Employee Benefit Plans (Summa_2
Employee Benefit Plans (Summary of Stock Award Activity) (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 6 Months Ended |
Dec. 31, 2020USD ($)$ / sharesshares | |
Number of Shares | |
Non-vested stock awards outstanding at June 30, 2020 | shares | 7,474 |
Granted | shares | 5,703 |
Released | shares | (2,342) |
Cancelled | shares | (660) |
Non-vested stock awards outstanding at December 31, 2020 | shares | 10,175 |
Vested and expected to vest at December 31, 2020 | shares | 9,709 |
Weighted-Average Grant Date Fair Value | |
Non-vested stock awards outstanding at June 30, 2020 | $ / shares | $ 6.83 |
Granted | $ / shares | 4.70 |
Released | $ / shares | 7.24 |
Cancelled | $ / shares | 9.37 |
Non-vested stock awards outstanding at December 31, 2020 | $ / shares | 5.37 |
Vested and expected to vest at December 31, 2020 | $ / shares | $ 5.32 |
Aggregate Fair Market Value | |
Non-vested stock awards outstanding at December 31, 2020 | $ | $ 70,104 |
Vested and expected to vest at December 31, 2020 | $ | $ 66,864 |
Employee Benefit Plans (Sched_2
Employee Benefit Plans (Schedule of PSUs Earned and Vested Based on Total Stockholder Return (TSR PSUs)) (Details) - Executive Officer Member - TSR PSU | 6 Months Ended |
Dec. 31, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Relative TSR, Below Threshold | TSR is less than the Index by more than 37.5 percentage points |
Relative TSR, Threshold | TSR is less than the Index by 37.5 percentage points |
Relative TSR, Target | TSR equals the Index |
Relative TSR, Maximum | TSR is greater than the Index by 25 percentage points or more |
Shares vested, Below Threshold | 0.00% |
Shares vested, Threshold | 25.00% |
Shares vested, Target | 100.00% |
Shares vested, Maximum | 150.00% |
Employee Benefit Plans (Sched_3
Employee Benefit Plans (Schedule of Fair Value Assumptions for Employee Stock Purchase Plan Awards) (Details) - Employee Stock Purchase Plan | 6 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | ||
Expected life | 6 months | 6 months |
Risk-free interest rate | 0.12% | 1.85% |
Volatility | 119.00% | 43.00% |
Information about Segments an_3
Information about Segments and Geographic Areas (Narratives) (Details) | 6 Months Ended |
Dec. 31, 2020SegmentGeographic_Area | |
Segment Reporting [Abstract] | |
Number of operating segments | Segment | 1 |
Number of geographic regions | Geographic_Area | 3 |
Information about Segments an_4
Information about Segments and Geographic Areas (Schedule of Long Lived Assets by Segment) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Segment Reporting Information [Line Items] | ||
Total long-lived assets | $ 211,380 | $ 233,722 |
Americas | ||
Segment Reporting Information [Line Items] | ||
Total long-lived assets | 161,396 | 177,443 |
EMEA | ||
Segment Reporting Information [Line Items] | ||
Total long-lived assets | 33,052 | 39,477 |
APAC | ||
Segment Reporting Information [Line Items] | ||
Total long-lived assets | $ 16,932 | $ 16,802 |
Derivatives and Hedging (Narrat
Derivatives and Hedging (Narratives) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Foreign currency transactions realized gain (loss) | $ (1.3) | $ (0.8) | $ (2.4) | $ (0.2) |
Interest Rate Swap | ||||
Derivative [Line Items] | ||||
Notional principal amount of forward foreign currency contracts | 200 | $ 200 | ||
Maturity date | Apr. 30, 2023 | |||
Unrealized loss on interest rate cash flow hedges | $ 1.7 | |||
Estimated interest expense over next twelve months | 1 | |||
Forward Foreign Currency Contracts | ||||
Derivative [Line Items] | ||||
Foreign currency transactions realized gain (loss) | 0.3 | 0.4 | $ 0 | |
Foreign currency transactions unrealized gain (loss) | 0.1 | 0.1 | ||
Forward Foreign Currency Contracts | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Notional principal amount of forward foreign currency contracts | $ 22.7 | $ 22.7 | ||
Maximum maturities for contracts | 40 days |
Restructuring Charges, Net of_3
Restructuring Charges, Net of Reversals and Impairment, and Related Charges (Narratives) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Jun. 30, 2021 | Dec. 31, 2020 | |
Restructuring Cost And Reserve [Line Items] | ||||||
Restructuring charges, net of reversals and impairment | $ 0.7 | $ 1.7 | ||||
Facility related charges | 0.3 | 0.6 | ||||
Severance and benefits charges | $ 0.4 | $ 1.1 | ||||
Reduction-in-force | ||||||
Restructuring Cost And Reserve [Line Items] | ||||||
Reduction in force or severance and benefits | $ 9.2 | |||||
Reduction-in-force | Scenario Forecast | ||||||
Restructuring Cost And Reserve [Line Items] | ||||||
Reduction in force or severance and benefits | $ 0.8 | |||||
Prior year Reduction-in-force plans | ||||||
Restructuring Cost And Reserve [Line Items] | ||||||
Restructuring charges, net of reversals and impairment | $ 6.6 | $ 12.8 | ||||
Severance and benefits charges | 2.7 | 4.9 | ||||
Prior year Reduction-in-force plans | Non-Cancelable Lease Payments | ||||||
Restructuring Cost And Reserve [Line Items] | ||||||
Charges for impairment of right-of-use assets | $ 3.9 | $ 7.9 |
Restructuring Charges, Net of_4
Restructuring Charges, Net of Reversals and Impairment, and Related Charges (Restructuring Liabilities) (Details) - Severance and Other - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Restructuring Cost And Reserve [Line Items] | ||||
Beginning balance | $ 302 | $ 2,137 | $ 2,219 | $ 3,559 |
Period charges | 475 | 3,284 | 1,247 | 5,879 |
Period reversals | (78) | (596) | (128) | (1,005) |
Period payments | (518) | (3,957) | (3,157) | (7,565) |
Ending balance | $ 181 | $ 868 | $ 181 | $ 868 |
Income Taxes (Narratives) (Deta
Income Taxes (Narratives) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating Loss Carryforwards [Line Items] | |||||
Income tax provision (benefit) | $ 1,823,000 | $ 1,797,000 | $ 3,143,000 | $ 3,392,000 | |
Remaining state net operating loss | 0 | $ 0 | 0 | $ 0 | |
Additions resulting from the acquisition of Aerohive | $ 75,000,000 | ||||
Unrecognized tax benefits | 24,200,000 | 24,200,000 | |||
Unrecognized tax benefits that would affect the effective tax rate if recognized | 500,000 | 500,000 | |||
Unrecognized tax benefit future impact if recognized | $ 23,700,000 | $ 23,700,000 | |||
Aerohive Networks, Inc. | |||||
Operating Loss Carryforwards [Line Items] | |||||
Amortization period of intangible assets and goodwill resulting from acquisition | 10 years |
Net Loss Per Share (Schedule of
Net Loss Per Share (Schedule of Earnings Per Share, Basic and Diluted) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Earnings Per Share [Abstract] | ||||
Net loss | $ (3,050) | $ (23,538) | $ (11,862) | $ (61,276) |
Shares used in per share calculation - basic and diluted | 123,264 | 119,555 | 122,485 | 119,891 |
Net loss per share - basic and diluted | $ (0.02) | $ (0.20) | $ (0.10) | $ (0.51) |
Net Loss Per Share (Schedule _2
Net Loss Per Share (Schedule of Anti-Dilutive Shares Excluded from Earnings Per Share Calculation) (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of EPS | 13,033 | 15,055 | 12,388 | 14,399 |
Options to purchase common stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of EPS | 2,156 | 3,177 | 2,345 | 3,037 |
Restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of EPS | 9,553 | 10,378 | 9,003 | 9,862 |
Employee Stock Purchase Plan shares | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of EPS | 1,324 | 1,500 | 1,040 | 1,500 |