Document And Entity Information
Document And Entity Information | 12 Months Ended |
Dec. 31, 2020shares | |
Document Information [Line Items] | |
Document Type | 20-F |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Entity Registrant Name | AUDIOCODES LTD |
Document Period End Date | Dec. 31, 2020 |
Entity File Number | 0-30070 |
Entity Incorporation, State or Country Code | IL |
Entity Address, Address Line One | 1 Hayarden Street |
Entity Address, Address Line Two | Airport City |
Entity Address, City or Town | Lod |
Entity Address, Postal Zip Code | 7019900 |
Entity Address, Country | IL |
Entity Well-known Seasoned Issuer | Yes |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Interactive Data Current | Yes |
Entity Emerging Growth Company | false |
Document Accounting Standard | U.S. GAAP |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 33,017,814 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | FY |
Entity Central Index Key | 0001086434 |
Amendment Flag | false |
Entity Voluntary Filers | No |
Trading Symbol | AUDC |
Security Exchange Name | NASDAQ |
Title of 12(b) Security | Ordinary Shares, nominal value NIS 0.01 per share |
ICFR Auditor Attestation Flag | false |
Business Contact [Member] | |
Document Information [Line Items] | |
Contact Personnel Name | Shabtai Adlersberg |
Entity Address, Address Line One | 1 Hayarden Street |
Entity Address, Address Line Two | Airport City |
Entity Address, City or Town | Lod |
Entity Address, Postal Zip Code | 7019900 |
City Area Code | 972-3 |
Entity Address, Country | IL |
Local Phone Number | 976-4105 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 40,934 | $ 64,773 |
Restricted cash | 5,100 | 5,000 |
Short-term and restricted bank deposits | 84,817 | 1,416 |
Short-term marketable securities and accrued interest | 449 | |
Trade receivables (net of allowance of $548 and $570 at December 31, 2020 and 2019, respectively) | 34,518 | 27,501 |
Other receivables and prepaid expenses | 8,631 | 5,626 |
Inventories | 29,193 | 28,275 |
Total current assets | 203,642 | 132,591 |
LONG-TERM ASSETS: | ||
Long-term and restricted bank deposits | 94 | 694 |
Long-term marketable securities and accrued interest | 54,895 | |
Deferred tax assets | 12,081 | 20,466 |
Operating lease right-of-use assets | 25,430 | 29,688 |
Severance pay funds | 20,597 | 19,370 |
Total long-term assets | 113,097 | 70,218 |
PROPERTY AND EQUIPMENT, NET | 4,593 | 4,392 |
INTANGIBLE ASSETS, NET | 569 | 901 |
GOODWILL | 36,222 | 36,222 |
Total assets | 358,123 | 244,324 |
CURRENT LIABILITIES: | ||
Current maturities of long-term bank loans | 1,200 | 2,473 |
Trade payables | 6,984 | 6,628 |
Other payables and accrued expenses | 28,531 | 24,692 |
Short-term royalty buyout liability (Note 11b) | 11,684 | 10,750 |
Deferred revenues | 37,182 | 33,538 |
Short-term operating lease liabilities | 9,178 | 8,579 |
Total current liabilities | 94,759 | 86,660 |
LONG-TERM LIABILITIES: | ||
Accrued severance pay | 21,830 | 20,313 |
Long-term bank loans, net of current maturities | 1,200 | |
Long-term royalty buyout liability (Note 11b) | 10,749 | |
Deferred revenues and other liabilities | 12,243 | 9,831 |
Long-term operating lease liabilities | 19,436 | 23,097 |
Total long-term liabilities | 53,509 | 65,190 |
COMMITMENTS AND CONTINGENT LIABILITIES (Note 11) | ||
SHAREHOLDERS' EQUITY: | ||
Share capital: Ordinary shares of NIS 0.01 par value - Authorized: 100,000,000 shares as of December 31, 2020 and 2019; Issued: 62,489,428 and 59,040,697 shares as of December 31, 2020 and 2019, respectively; Outstanding: 33,017,814 and 29,569,083 shares as of December 31, 2020 and 2019, respectively | 105 | 94 |
Additional paid-in capital | 362,164 | 265,372 |
Treasury stock at cost - 29,471,614 shares as of December 31, 2020 and 2019 | (137,793) | (137,793) |
Accumulated other comprehensive income | 1,772 | |
Accumulated deficit | (16,393) | (35,199) |
Total shareholders' equity | 209,855 | 92,474 |
Total liabilities and shareholders' equity | $ 358,123 | $ 244,324 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) $ in Thousands | Dec. 31, 2020USD ($)shares | Dec. 31, 2020₪ / shares | Dec. 31, 2019USD ($)shares | Dec. 31, 2019₪ / shares |
CONSOLIDATED BALANCE SHEETS | ||||
Allowance for doubtful accounts receivable (in dollars) | $ | $ 548 | $ 570 | ||
Ordinary shares, par value (in NIS per share) | ₪ / shares | ₪ 0.01 | ₪ 0.01 | ||
Ordinary shares, shares authorized | 100,000,000 | 100,000,000 | ||
Ordinary shares, shares issued | 62,489,428 | 59,040,697 | ||
Ordinary shares, shares outstanding | 33,017,814 | 29,569,083 | ||
Treasury stock, shares | 29,471,614 | 29,471,614 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues: | |||
Total revenues | $ 220,774 | $ 200,287 | $ 176,223 |
Cost of revenues: | |||
Total cost of revenues | 70,958 | 105,329 | 65,617 |
Gross profit | 149,816 | 94,958 | 110,606 |
Operating expenses: | |||
Research and development, net | 46,072 | 41,199 | 34,661 |
Selling and marketing | 51,217 | 51,535 | 49,335 |
General and administrative | 14,177 | 11,778 | 10,251 |
Total operating expenses | 111,466 | 104,512 | 94,247 |
Operating income (loss) | 38,350 | (9,554) | 16,359 |
Financial income (expenses), net | (1,703) | (1,761) | 228 |
Income (loss) before taxes on income | 36,647 | (11,315) | 16,587 |
Taxes on income | (9,399) | 15,292 | (3,094) |
Net income | $ 27,248 | $ 3,977 | $ 13,493 |
Earnings per share: | |||
Income (loss) before taxes on income | $ 0.87 | $ 0.14 | $ 0.47 |
Diluted (in dollars per share) | $ 0.83 | $ 0.13 | $ 0.45 |
Weighted average number of shares used in computations of earnings per share: | |||
Basic | 31,440,093 | 29,251,888 | 28,928,060 |
Diluted | 32,915,683 | 30,799,904 | 30,219,806 |
Product [Member] | |||
Revenues: | |||
Revenue from Contract with Customer, Including Assessed Tax | $ 145,332 | $ 135,646 | $ 119,887 |
Cost of revenues: | |||
Cost of Goods and Services Sold | 54,384 | 59,022 | 51,878 |
Service [Member] | |||
Revenues: | |||
Revenue from Contract with Customer, Including Assessed Tax | 75,442 | 64,641 | 56,336 |
Cost of revenues: | |||
Cost of Goods and Services Sold | $ 16,574 | 14,129 | $ 13,739 |
Expenses related to royalty buyout agreement with the Israel National Authority for Technology and Innovation (Note11b) | |||
Cost of revenues: | |||
Cost of Goods and Services Sold | $ 32,178 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Net income | $ 27,248 | $ 3,977 | $ 13,493 |
Other comprehensive income related to: | |||
Other comprehensive income, related to unrealized gain on marketable securities, net of tax | 453 | 32 | 12 |
Change in unrealized gain on derivatives, net of tax: | |||
Gain on derivatives recognized in other comprehensive income | 3,445 | 535 | (489) |
Gain on derivatives (effective portion) reclassified into earnings | (2,126) | (291) | 245 |
Other comprehensive income, related to unrealized gain on derivatives | 1,319 | 244 | (244) |
Other comprehensive income related to: | |||
Other comprehensive income (loss), related to unrealized gain (loss) on marketable securities, net of tax | 453 | 32 | 12 |
Other comprehensive income, net of tax | 1,772 | 276 | (232) |
Total comprehensive income | $ 29,020 | $ 4,253 | $ 13,261 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Share capital [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | AOCI Attributable to Parent [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2017 | $ 93 | $ 248,176 | $ (115,476) | $ (44) | $ (40,368) | $ 92,381 |
Cumulative effect adjustment resulting from adoption of new accounting pronouncements | 0 | 0 | 0 | 0 | 180 | 180 |
Purchase of treasury stock | (5) | 0 | (14,316) | 0 | 0 | (14,321) |
Issuance of shares upon exercise of options and warrants and vesting of restricted stock units | 4 | 5,517 | 0 | 0 | 0 | 5,521 |
Share-based compensation related to options and restricted stock units granted to employees and non-employees | 0 | 3,287 | 0 | 0 | 0 | 3,287 |
Cash dividends paid | 0 | 0 | 0 | 0 | (5,761) | (5,761) |
Other comprehensive income (loss) | 0 | 0 | 0 | (232) | 0 | (232) |
Net income | 0 | 0 | 0 | 0 | 13,493 | 13,493 |
Balance at Dec. 31, 2018 | 92 | 256,980 | (129,792) | (276) | (32,456) | 94,548 |
Purchase of treasury stock | (1) | 0 | (8,001) | 0 | 0 | (8,002) |
Issuance of shares upon exercise of options and warrants and vesting of restricted stock units | 3 | 3,100 | 0 | 0 | 0 | 3,103 |
Share-based compensation related to options and restricted stock units granted to employees and non-employees | 0 | 5,292 | 0 | 0 | 0 | 5,292 |
Cash dividends paid | 0 | 0 | 0 | 0 | (6,720) | (6,720) |
Other comprehensive income (loss) | 0 | 0 | 0 | 276 | 0 | 276 |
Net income | 0 | 0 | 0 | 0 | 3,977 | 3,977 |
Balance at Dec. 31, 2019 | 94 | 265,372 | (137,793) | 0 | (35,199) | 92,474 |
Issuance of shares upon exercise of options and warrants and vesting of restricted stock units | 3 | 2,603 | 0 | 0 | 0 | 2,606 |
Stock Issued During Period, Value, New Issues | $ 8 | 85,418 | $ 0 | 0 | 0 | 85,426 |
Stock Issued During Period, Shares, New Issues | 0 | 0 | ||||
Share-based compensation related to options and restricted stock units granted to employees and non-employees | 8,771 | 0 | 0 | 8,771 | ||
Cash dividends paid | $ 0 | 0 | $ 0 | 0 | (8,442) | (8,442) |
Other comprehensive income (loss) | 0 | 0 | 0 | 1,772 | 0 | 1,772 |
Net income | 0 | 0 | 0 | 0 | 27,248 | 27,248 |
Balance at Dec. 31, 2020 | $ 105 | $ 362,164 | $ (137,793) | $ 1,772 | $ (16,393) | $ 209,855 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||
Net income | $ 27,248 | $ 3,977 | $ 13,493 |
Adjustments required to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 2,268 | 2,044 | 2,309 |
Amortization of marketable securities premiums and accretion of discounts, net | 172 | 79 | 353 |
Share-based compensation related to options and RSUs granted to employees and non-employees | 8,771 | 5,292 | 3,287 |
Decrease (increase) in accrued interest and exchange rate effect on loans, marketable securities and bank deposits | (26) | 140 | (32) |
Decrease (increase) in deferred tax assets, net | 8,329 | (16,282) | 2,251 |
Increase in trade receivables, net | (7,017) | (5,222) | (220) |
Decrease (increase) in other receivables and prepaid expenses | (1,516) | 259 | (1,012) |
Increase in inventories | (1,525) | (5,925) | (6,309) |
Decrease in operating lease right-of-use assets | 7,913 | 7,444 | 0 |
Decrease in operating lease liabilities | (6,717) | (5,456) | 0 |
Increase (decrease) in royalty buyout liability | (9,815) | 21,499 | 0 |
Increase in trade payables | 356 | 440 | 549 |
Increase in other payables and accrued expenses | 3,839 | 2,805 | 1,437 |
Increase in deferred revenues | 5,906 | 12,342 | 9,354 |
Increase (decrease) in accrued severance pay, net | 290 | (267) | 120 |
Net cash provided by operating activities | 38,476 | 23,169 | 25,580 |
Cash flows from investing activities: | |||
Purchase of property and equipment | (1,530) | (1,949) | (1,340) |
Purchase of marketable securities | (54,977) | (10,025) | 0 |
Proceeds from redemption of marketable securities | 0 | 29,412 | 7,577 |
Investment in short-term and restricted bank deposits | (84,000) | 0 | (9,636) |
Proceeds from short-term and restricted bank deposits | 599 | 10,962 | 0 |
Proceeds from long-term and restricted bank deposits | 600 | 1,200 | 2,307 |
Net cash provided by (used in) investing activities | (139,308) | 29,600 | (1,092) |
Cash flows from financing activities: | |||
Purchase of treasury shares | 0 | (8,002) | (14,321) |
Repayment of bank loans | (2,497) | (2,470) | (2,508) |
Cash dividends paid to shareholders | (8,442) | (6,720) | (5,761) |
Payment related to the acquisition of ACS | 0 | (410) | (151) |
Proceeds from issuance of shares upon exercise of options and warrants | 2,606 | 3,103 | 5,521 |
Proceeds from issuance of shares in a public offering, net | 85,426 | 0 | 0 |
Net cash provided by (used) in financing activities | 77,093 | (14,499) | (17,220) |
Increase (decrease) in cash, cash equivalents and restricted cash | (23,739) | 38,270 | 7,268 |
Cash, cash equivalents and restricted cash at beginning of period | 69,773 | 31,503 | 24,235 |
Cash, cash equivalents and restricted cash at end of period | 46,034 | 69,773 | 31,503 |
Supplemental disclosure of cash flow activities: | |||
Cash paid during the period for income taxes | 835 | 1,105 | 933 |
Cash paid during the period for interest | 204 | 205 | 267 |
Significant non-cash transactions: | |||
Right-of-use asset recognized with corresponding lease liability | 3,655 | 4,010 | 0 |
Inventory transferred to be used as property and equipment | $ 607 | $ 270 | $ 252 |
GENERAL
GENERAL | 12 Months Ended |
Dec. 31, 2020 | |
GENERAL | |
GENERAL | NOTE 1:- GENERAL a. Business overview: AudioCodes Ltd. (the “Company”) and its subsidiaries (together the “Group”) is a leading vendor of advanced communication, software, products and productivity solutions for the digital workplace. The Company's products are deployed on-premises or delivered from the cloud. Providing software communications, cloud-based platforms, customer premise equipment and software applications, the Company's solutions and products are geared to meet the growing needs of enterprises and service providers realigning their operations towards the transition to all-IP networks and hosted unified communications and collaboration business services. In addition, the Company offers a complete suite of professional and managed services that allow the Company's partners and customers to choose a service packages (or complement their own offering) from a modular portfolio of professional services. The Company operates through its wholly-owned subsidiaries in the United States, Europe, Asia, Latin America, Australia and Israel. b. The Group is dependent upon sole source suppliers for certain key components used in its products, including certain digital signal processing chips. Although there are a limited number of manufacturers of these particular components, management believes that other suppliers could provide similar components on comparable terms. A change in suppliers, however, could cause a delay in manufacturing and a possible loss of sales, which could adversely affect the operating results and financial position of the Group. c. During the years ended December 31, 2020, 2019 and 2018, the Group had a major customer which accounted for 13.5%, 16.0% and 17.8%, respectively, of total revenues in those years. In addition, during the years ended December 31, 2020, 2019 and 2018, the Group had an additional major customer which accounted for 13.0%, 13.5% and 11.1%, respectively, of total revenues in those years. No other customer accounted for more than 10% of the Group’s revenues in those periods. d. On December 23, 2019, a merger agreement was signed between the Company and one of its subsidiaries, AudioCodes Development Ltd. In September 2020, the Company received the approval of the Israel Tax Authority to the merger. The merger was effective as of January 1, 2020. e. COVID- 19 On March 11, 2020, the World Health Organization declared the COVID-19 outbreak a global pandemic. The outbreak has reached all of the regions in which the Group does business, and governmental authorities around the world have implemented numerous measures attempting to contain and mitigate the effects of the virus, including travel bans and restrictions, border closings, quarantines, shelter-in-place orders, shutdowns, limitations or closures of non-essential businesses, and social distancing requirements. Companies around the world, including the Group, the Group’s customers, partners, and vendors, have implemented actions in response, including among others, office closings, site restrictions, and employee travel restrictions. NOTE 1:- GENERAL (Cont.) The global spread of COVID-19 and actions taken in response have caused and may continue to cause disruptions and/or delays in the Group’s supply chain, manufacturing and shipments, and caused significant economic and business disruption to the Group's customers, partners and vendors. In response to these challenges, the Group quickly adjusted its operations to work from home and it believes its business continuity plan is working well. The extent of the impact of COVID-19 on the Group's business and results of operations will depend on future developments, which are highly uncertain, including the duration and severity of the outbreak, the effects of subsequent waves of COVID-19, the Group's ability to maintain its supply chain and to continue to manufacture products and restrictions on its business and personnel that may be imposed by governmental rules and regulations implemented to contain or treat COVID-19. The Company’s management is monitoring and assessing the impact of the COVID-19 pandemic daily, including recommendations and orders issued by government and public health authorities. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
SIGNIFICANT ACCOUNTING POLICIES | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America ("U.S. GAAP"), applied on a consistent basis as follows: a. Use of estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. The Company's management believes that the estimates, judgments and assumptions used are reasonable based upon information available at the time they are made. As applicable to these interim condensed consolidated financial statements, the most significant estimates and assumptions relate to revenue recognition and allowance for sales returns, allowance for doubtful accounts, inventories write-off, intangible assets, goodwill, income taxes and valuation allowance, share-based compensation and contingent liabilities. Actual results could differ from those estimates. In light of the currently unknown extent and duration of the COVID-19 pandemic, the Company faces a greater degree of uncertainty than normal in making the judgments and estimates needed to apply certain of the Company's significant accounting policies. The Company assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to the Company and the unknown future impacts COVID-19 as of December 31, 2020 and through the date of issuance of this report. These estimates may change, as new events occur and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions. b. Financial statements in U.S. dollars ("dollars"): A majority of the Group’s revenues is generated in dollars. In addition, most of the Group’s costs are denominated and determined in dollars and in new Israeli shekels ("NIS"). Management believes that the dollar is the currency in the primary economic environment in which the Group operates. Thus, the functional and reporting currency of the Group is the dollar. Accordingly, monetary accounts maintained in currencies other than the dollar are remeasured into dollars in accordance with Accounting Standards Codification ("ASC") 830, "Foreign Currency Matters". All transaction gains and losses of the remeasured monetary balance sheet items are reflected in the statements of operations as financial income or expenses, as appropriate. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) c. Principles of consolidation: The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany transactions and balances, including profits from intercompany sales not yet realized outside the Group, have been eliminated upon consolidation. d. Cash equivalents: Cash equivalents represent short-term highly liquid investments that are readily convertible into cash with original maturities of three months or less at the date acquired. e. Short-term and restricted bank deposits: Short-term and restricted bank deposits are deposits with maturities of more than three months, but less than one year. The deposits are mainly in dollars and bear interest at an average annual rate of 0.97% and 1.88% for the years ended December 31, 2020 and 2019, respectively. Short-term and restricted deposits are presented at cost. Any accrued interest on these deposits is included in other receivables and prepaid expenses. In connection with long-term bank loans and their related covenants, the Company is required to maintain compensating balances with the banks and to maintain deposits in the same banks that provided the loans to the Company (see Note 9).In addition, the Company maintains restricted deposits in connection with an office lease agreement (see also Note 10a). Out of the short-term and restricted bank deposits, a total of $5,910 and $6,409, are restricted short-term deposits as of December 31, 2020 and 2019, respectively. f. Marketable securities: The Group accounts for investments in debt securities in accordance with ASC 320, "Investments - Debt and Equity Securities". Management determines the appropriate classification of its investments in marketable debt securities at the time of purchase and reevaluates such determinations at each balance sheet date. As of December 31, 2020, the Group classified all of its marketable securities as available-for-sale (“AFS”). AFS securities are carried at fair value, with the unrealized gains and losses, net of tax, reported in “accumulated other comprehensive loss” in shareholders’ equity. Realized gains and losses on sale of investments are included in “financial income (expenses), net” and are derived using the specific identification method for determining the cost of securities. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. Such amortization, together with interest on securities, is included in "financial income (expenses), net". The Group assessed AFS debt securities with an amortized cost basis in excess of estimated fair value to determine what amount of that difference, if any, is caused by expected credit losses in accordance with ASC 326, "Financial Instruments - Credit Losses". Allowance for credit losses on AFS debt securities are recognized as a charge in other income (expenses), net, on the consolidated statements of operation, and any remaining unrealized losses, net of taxes, are included in accumulated other comprehensive income (loss) in stockholders' equity. The Group has not recorded credit losses for the year ended December 31,2020. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) g. Inventories: Inventories are stated at the lower of cost or market value. Cost is determined as follows: Raw materials - using the "weighted average cost" method; and Finished products - using the "weighted average cost" method with the addition of direct manufacturing costs. The Group periodically evaluates the quantities on hand relative to current and historical selling prices, historical and projected sales volume and technological obsolescence. Based on these evaluations, inventory write-offs are taken based on slow moving items, technological obsolescence, excess inventories, discontinuation of product lines, and market prices lower than cost. h. Long-term and restricted bank deposits: Bank deposits and the related accrued interest with maturities of more than one year are included in long-term investments and presented at their cost. Accrued interest that is payable within a one-year period is included in other receivables and prepaid expenses. The deposits are denominated in dollars and bear interest at an average annual rate of 0% and 2.16% for the years ended December 31, 2020 and 2019, respectively. Out of the total long-term bank deposits, a total of $0 and $600 are restricted long-term deposits as of December 31, 2020 and 2019, respectively. i. Property and equipment: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated by the straight-line method over the estimated useful lives of the assets at the following annual rates: Computers and peripheral equipment 33% Office furniture and equipment 6% – 20% (mainly 15%) Leasehold improvements Over the shorter of the term of the lease, or the useful life of the assets The Group’s long-lived assets (asset group) to be held and used, including right of use assets and intangible that are subject to amortization are reviewed for impairment in accordance with ASC 360-10-35, "Property, Plant and Equipment - Subsequent Measurement" whenever events or changes in circumstances indicate that the carrying amount of an asset (or asset group) may not be recoverable. If such assets are considered to be impaired, recoverability of assets (asset group) to be held and used is measured by a comparison of the carrying amount of an asset (asset group) to the future undiscounted cash flows expected to be generated by the asset. The impairment to be recognized is measured by the amount by which the carrying amount of the assets (asset groups) exceeds the fair value of the assets (asset groups). During the years ended December 31, 2020, 2019 and 2018, no impairment losses have been identified for property and equipment. j. Intangible assets: Intangible assets are comprised of acquired technology, customer relations and licenses. Intangible assets that are not considered to have an indefinite useful life are amortized using the straight-line basis over their estimated useful lives, which range from 4.5 to 10 years. Recoverability of these assets is measured by a comparison of the carrying amount of the asset to the undiscounted future cash flows expected to be generated by the assets. If the assets are considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired assets. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) During the years ended December 31, 2020, 2019 and 2018, no impairment losses have been identified with respect to intangible assets. k. Leases: The Company adopted Accounting Standards Update ("ASU") 2016-02, "Leases (Topic 842)", or "ASC 842") on January 1, 2019, using the modified retrospective approach, by applying ASC 842 to all leases existing at the date of initial application. The standard requires lessees to recognize almost all leases on the balance sheet as a right-of-use asset and a lease liability and requires leases to be classified as either an operating or a finance type lease. The standard excludes leases of intangible assets or inventory. Leases with a term of 12 months or less can be accounted for in a manner similar to the accounting for operating leases under ASC 840. The new standard requires lessors to account for leases using an approach that is substantially equivalent to ASC 840 for sales-type leases, direct financing leases and operating leases. The Company determines if an arrangement is a lease at inception. Lease classification is governed by five criteria in ASC 842-10-25-2. If any of these five criteria is met, the Company classifies the lease as a finance lease. Otherwise, the Company classifies the lease as an operating lease. The Company uses incremental borrowing rates based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The right-of use asset also includes any lease payments made and excludes lease incentives. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expenses are recognized on a straight-line basis over the lease term or the useful life of the leased asset. In addition, the carrying amount of the right-of use asset and lease liabilities are remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset. l. Goodwill: Goodwill and certain other purchased intangible assets have been recorded as a result of acquisitions. Goodwill represents the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill is not amortized, but rather is subject to an impairment test. The Group performs an annual impairment test during the fourth quarter of each fiscal year, or more frequently if impairment indicators are present. The Group operates in one operating segment, and this segment comprises its only reporting unit. Goodwill is not amortized, but rather is subject to an impairment test. In accordance with ASC 350, "Intangibles – Goodwill and Other", at least annually (in the fourth quarter), or more frequently if events or changes in circumstances indicate that the carrying value may be impaired. The Company has an option to perform a qualitative assessment to determine whether it is more-likely-than-not that the fair value of a reporting unit is less than its carrying value prior to performing the quantitative goodwill impairment test. The Company operates in one operating segment, and this segment comprises its only reporting unit. Following the adoption of ASU 2017-04, "Simplifying the Test for Goodwill Impairment", as part of the quantitative goodwill impairment test, any excess of the carrying value of the reporting unit over its fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to the fair value of the reporting unit. For each of the three years in the period ended December 31, 2020, the Group performed an annual impairment analysis, using market capitalization, and no impairment losses have been identified. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) m. Revenue recognition: The Group generates its revenues primarily from the sale of products through a direct sales force and sales representatives. The Group’s products are delivered to its customers, which include original equipment manufacturers, network equipment providers, systems integrators and distributors in the telecommunications and networking industries, all of whom are considered end-users. Revenues are recognized in accordance with ASC 606, "Revenue from Contracts with Customers". The Group recognizes revenue under the core principle that transfer of control to a customer of the Group generates revenue in an amount reflecting the consideration the Group expects to receive from the customer. As such, the Group identifies a contract with a customer, identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to each performance obligation in the contract and recognizes revenues when (or as) the Group satisfies a performance obligation. Product revenues are recognized when all performance obligations are satisfied, at the point of time when control is transferred, the product has been delivered and the benefit of the asset has been transferred. Revenues from support are recognized ratably over the term of the underlying contract term. Renewals of support contracts create new performance obligations that are satisfied over the term with the revenues recognized ratably over the period. For professional services, the performance obligations are satisfied, and revenues are recognized, when the services are provided or once the service term has expired. The Group enters into contracts that can include combinations of products and services that are capable of being distinct and accounted for as separate performance obligations. The products are distinct upon delivery as the customer can derive the economic benefit of it without any professional services, updates or technical support. The Group allocates the transaction price to each performance obligation, based on its relative standalone selling price out of the total consideration of the contract. For support, the Group determines the standalone selling prices, based on the price at which the Group separately sells a renewal contract on a standalone basis. For professional services, the Group determines the standalone selling prices based on the price at which the Group separately sells those services on a standalone basis. The Group’s products contain a significant element relating to its proprietary technology and its solutions offer substantially different features and functionality. As a result, the comparable pricing of products with similar functionality typically cannot be obtained. Additionally, as the Group is unable to reliably determine the selling prices of comparable products sold by competitors and generally does not sell the products separately on a standalone basis, the standalone selling prices are not directly observable. Therefore, the Group makes estimates, based on reasonably available information. The estimated selling price is established considering multiple factors including, but not limited to, pricing practices in different geographical areas and through different sales channels, gross margin objectives, internal costs, the pricing strategies of competitors and industry technology lifecycles. The Group grants to certain customers a right of return or the ability over a limited period to exchange for other products a specific percentage of the total price paid for products they have purchased. The Group maintains a provision for product returns and exchanges and other incentives, based on its experience with historical sales returns, analysis of credit memo data and other known factors, all in accordance with ASC 606. This provision is deducted from revenues and amounted to $2,962 and $1,885 as of December 31, 2020 and 2019, respectively. This provision was recorded as part of other payables and accrued expenses. Deferred revenues include amounts invoiced to customers for which revenue has not yet been recognized. Deferred revenues are recognized as (or when) the Group performs the performance obligations under the contract. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The Group pays sales commissions to sales and marketing personnel, based on their attainment of certain predetermined sales goals. Some sales commissions for support earned by its employees are capitalized and amortized on a straight line basis over the related contractual support period. Amortization expenses related to these costs are included in selling and marketing expenses in the consolidated statements of operations. The Group has included as part of other receivables and prepaid expenses in its consolidated balance sheet, costs to obtain a contract in the amount of $665 and $460, as of December 31, 2020 and 2019, respectively. In addition, the Group's consolidated statement of operations included a reduction of expenses, in the net amount of $205, $38 and $242 for the years ended December 31, 2020 ,2019 and 2018, respectively. Remaining performance obligations represents contracted revenues that have not yet been recognized, which includes deferred revenues and non-cancelable contracts that will be recognized as revenue in future periods. The following table represents the remaining performance obligations as of December 31, 2020, which are expected to be satisfied and recognized in future periods: Year Ending December 31, 2023 and 2021 2022 thereafter Product $ 295 $ 72 $ 8 Services 36,887 5,187 6,687 $ 37,182 $ 5,259 $ 6,695 Significant changes in the balances of deferred revenues during the period are as follows: December 31, 2020 2019 Balance, at the beginning of the year $ 43,230 $ 29,962 Revenue recognized (31,172) (17,577) Increase in deferred revenues and customer advances 37,078 30,845 Balance, at the end of the year 49,136 43,230 Less current portion (37,182) (33,538) Long term portion $ 11,954 $ 9,692 n. Warranty costs: The Group usually provides an assurance-type warranty for a period of 12 months at no extra charge. The Group estimates the costs that may be incurred under its basic limited warranty and records a liability in the amount of such costs at the time product revenue is recognized. Factors that affect the Group’s warranty liability include the number of installed units, historical and anticipated rates of warranty claims, and cost per claim. The Group periodically assesses the adequacy of its recorded warranty liability and adjusts the amount as necessary. As of December 31, 2020 and 2019, the provision for warranty amounted to $253 and $284, respectively. o. Research and development costs: ASC 985-20, "Costs of Software to Be Sold, Leased, or Marketed", requires capitalization of certain software development costs subsequent to the establishment of technological feasibility. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Based on the Company’s product development process, technological feasibility is established upon the completion of a working model. The Company does not incur material costs between the completion of a working model and the point at which the products are ready for general release. Therefore, research and development costs are charged to the consolidated statement of operations, as incurred. Participation grants from the Israel Innovation Authority (formerly known as the Office of the Chief Scientist of the Israeli Ministry of Economy and Industry) (the "IIA") for research and development activity are recognized at the time the Company is entitled to such grants on the basis of the costs incurred and included as a deduction of research and development costs. Research and development grants recognized during the years ended December 31, 2020, 2019 and 2018 were $388, $1,323 and $5,734, respectively. p. Income taxes: The Group accounts for income taxes in accordance with ASC 740, "Income Taxes". ASC 740 prescribes the use of the liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax bases of assets and liabilities and for carry forward tax losses. Deferred taxes are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Group records a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value if it is more-likely-than-not that some portion of or the entire amount of the deferred tax asset will not be realized. In addition, ASC 740 prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The first step is to evaluate the tax position taken or expected to be taken in a tax return. This is done by determining if the weight of available evidence indicates that it is more-likely-than-not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. Interest and penalties assessed by taxing authorities on an underpayment of income taxes are included as a component of income tax expense in the consolidated statements of operations. q. Accumulated other comprehensive income (loss) ("AOCI"): The Company accounts for comprehensive income (loss) in accordance with ASC 220, "Comprehensive Income", which establishes standards for the reporting and presentation of comprehensive income (loss) and its components in a full set of general purpose financial statements. Comprehensive income (loss) generally represents all changes in shareholders’ equity during the period except those resulting from investments by, or distributions to, shareholders. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The components of AOCI were as follows: Unrealized gains on available- Unrealized for-sale gains (losses) marketable on cash flow securities hedges Total Balance as of January 1, 2020 $ — $ — $ — Other comprehensive income before reclassifications, net of tax 453 3,445 3,898 Amounts reclassified from AOCI — (2,126) (2,126) Other comprehensive income, net of tax 453 1,319 1,772 Balance as of December 31, 2020 $ 453 $ 1,319 $ 1,772 The effects on net income of amounts reclassified from AOCI in the year ended December 31, 2020 derive from realized losses on cash flow hedges recorded in operating expenses and from realized losses on available-for-sale marketable securities recorded in financial income (expenses), net. r. Concentrations of credit risk: Financial instruments that potentially subject the Group to concentrations of credit risk consist principally of cash and cash equivalents, bank deposits, trade receivables, marketable securities and foreign currency derivative contracts. The majority of the Group’s cash and cash equivalents, bank deposits and foreign currency derivative contracts are invested in dollar denominated instruments with major banks in Israel and the United States. Such investments in the United States may be in excess of insured limits and are not insured in other jurisdictions. Management believes that the financial institutions that hold the Group’s investments are corporations with high credit standing. Accordingly, management believes that low credit risk exists with respect to these financial investments. Marketable securities include investments in dollar-denominated corporate bonds. Marketable securities consist of highly liquid debt instruments with high credit standing. The Company’s investment policy, approved by the Board of Directors, limits the amount the Group may invest in any one type of investment or issuer, thereby reducing credit risk concentrations. Management believes that the Group’s portfolio is well diversified and, accordingly, minimal credit risk exists with respect to these marketable debt securities. The trade receivables of the Group are derived from sales to customers located primarily in the Americas, the Far East, Israel and Europe. Under certain circumstances, the Group may require letters of credit, other collateral, additional guarantees or advance payments. Regarding certain credit balances, the Group is covered by foreign trade risk insurance. The Group performs ongoing credit evaluations of its customers and establishes an allowance for doubtful accounts based upon a specific review. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) s. Earnings per share: Basic earnings per share are computed based on the weighted average number of ordinary shares outstanding during each year. Diluted earnings per share are computed based on the weighted average number of ordinary shares outstanding during each year, plus potential dilutive ordinary shares considered outstanding during the year, in accordance with ASC 260, "Earnings per Share". Certain outstanding options, restricted share units ("RSUs") and warrants have been excluded from the calculation of the diluted earnings per share since such securities are anti-dilutive for all years presented. The total weighted average number of shares related to the outstanding options, RSUs and warrants that have been excluded from the calculation of diluted earnings per share was 64,312, 48,491 and 158,832 for the years ended December 31, 2020, 2019 and 2018, respectively. t. Accounting for share-based compensation: The Company accounts for share-based compensation in accordance with ASC 718, "Compensation-Stock Compensation". ASC 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company’s consolidated statement of operations. The weighted-average estimated fair value of employee stock options granted during the years ended December 31, 2020, 2019 and 2018, was $8.55, $6.63 and $3.02 per share, respectively, using the Black-Scholes option pricing model. Fair values were estimated using the following weighted-average assumptions (annualized percentages): Year Ended December 31, 2020 2019 2018 Dividend yield 1.01%-1.17% 1.13%-1.64% 0%-2.66% Expected volatility 37.89%-43.09% 38.08%-39.34% 37.74%-41.72% Risk-free interest 0.29%-1.43% 1.66%-2.59% 2.40%-3.06% Expected life 3.57-4.23 years 4.75-5.21 years 4.78-5.27 years The Company used its historical volatility in accordance with ASC 718. The computation of volatility uses historical volatility derived from the Company's exchange traded shares. The expected term of options granted is estimated based on historical experience and represents the period of time that options granted are expected to be outstanding. The risk free interest rate assumption is the implied yield currently available on United States treasury zero-coupon issues with a remaining term equal to the expected life of the Company's options. The dividend yield assumption is based on the Company's historical experience and expectation of future dividend payouts and may be subject to substantial change in the future. The Company paid its first cash dividend during the third quarter of 2018 and has been paying cash dividends on a bi-annual basis since then. The Company currently expects to continue pay cash dividends in the future, subject to receipt of required Israeli court approvals, although there can be no assurance that it will do so. See also Note 12. The total share-based compensation expenses relating to all of the Company’s share-based awards recognized for the years ended December 31, 2020, 2019 and 2018 were included in items of the consolidated statements of operations, as follows: NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Year Ended December 31, 2020 2019 2018 Cost of revenues $ 181 $ 183 $ 186 Research and development expenses, net 1,535 937 651 Selling and marketing expenses 3,635 2,171 1,238 General and administrative expenses 3,420 2,001 1,212 Total share-based compensation expenses $ 8,771 $ 5,292 $ 3,287 u. Treasury stock: The Company has repurchased its ordinary shares from time to time in the open market, and holds such repurchased shares as treasury stock. The Company presents the cost to repurchase treasury stock as a reduction of shareholders’ equity. See also Note 12a. v. Severance pay: The liability for severance pay for Israeli employees is calculated pursuant to the Israeli Severance Pay Law, 1963 (the "Severance Pay Law"), based on the most recent salary of the employees multiplied by the number of years of employment as of the balance sheet date for all employees in Israel. Employees who have been employed for more than a one-year period are entitled to one month’s salary for each year of employment or a portion thereof. The Group’s liability for all of its Israeli employees is fully provided for by monthly deposits with severance pay funds, pension funds, insurance policies and by an accrual. The value of these deposits is recorded as an asset in the Company’s consolidated balance sheet. The deposited funds include profits accumulated up to the consolidated balance sheets date. The deposited funds may be withdrawn only upon the fulfillment of the obligation pursuant to the Severance Pay Law or labor agreements. Since March 2011, the Group’s agreements with new Israeli employees are under Section 14 of the Severance Pay Law. The Group’s contributions for severance pay have replaced its severance pay obligation. Upon contribution of the full amount of the employee’s monthly salary for each year of service, no additional calculations are conducted between the parties regarding the matter of severance pay and no additional payments are made by the Group to the employee upon termination. The Group is legally released from the obligations to employees once the deposit amounts have been paid, and therefore the severance pay liability is not reflected in the balance sheet. Severance pay expenses for the years ended December 31, 2020, 2019 and 2018, amounted to $3,078, $2,324 and $2,680, respectively. w. Employee benefit plan: The Group has 401(k) defined contribution plans covering employees in the U.S. All eligible employees may elect to contribute a portion of their annual compensation to the plan through salary deferrals, subject to the IRS limit of $19.5 during the years ended December 31, 2019 and 2020, plus a catch-up contribution of $6.5 for participants age 50 or over. The Group matches 50% of employees’ contributions, up to a maximum of 6% of the employees’ annual pay. In the years ended December 31, 2020, 2019 and 2018, the Group matched contributions in the amount of $386, $318 and $308, respectively. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) x. Advertising expenses: Advertising expenses are charged to th |
MARKETABLE SECURITIES AND ACCRU
MARKETABLE SECURITIES AND ACCRUED INTEREST | 12 Months Ended |
Dec. 31, 2020 | |
MARKETABLE SECURITIES AND ACCRUED INTEREST | |
MARKETABLE SECURITIES AND ACCRUED INTEREST | NOTE 3:- MARKETABLE SECURITIES AND ACCRUED INTEREST The following is a summary of available-for-sale marketable securities: December 31, 2020 Amortized Unrealized Unrealized Fair cost gains losses Value Maturing between one to five years: Corporate bonds $ 53,351 $ 508 (6) $ 53,853 Governmental bonds 1,055 — (13) 1,042 Accrued interest 449 — — 449 Balance as of December 31, 2020 $ 54,855 $ 508 $ (19) $ 55,344 These investments were issued by highly rated corporations, ranged from BBB to A+. Accordingly, the securities were not settled at a price less than the amortized cost of the Group's investment. On each reporting period, the Company evaluates whether declines in fair value below carrying value are due to expected credit losses, as well as the ability and intent to hold the investment until a forecasted recovery occurs, in accordance with ASC 326. Allowance for credit losses on of available-for-sale debt securities are recognized as a charge in financial expenses (income), net, on the consolidated statements of income, and any remaining unrealized losses, net of taxes, are included in accumulated other comprehensive income (loss) in shareholders' equity. The Company has not recorded credit losses for the year ended December 31, 2020. As of December 31, 2019, the Group did not have any investments in marketable securities. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2020 | |
INVENTORIES | |
INVENTORIES | NOTE 4:- INVENTORIES December 31, 2020 2019 Raw materials $ 13,376 $ 10,700 Finished products 15,817 17,575 $ 29,193 $ 28,275 In the years ended December 31, 2020, 2019 and 2018, the Group wrote-off inventories in total amounts of $4,175, $4,493 and $1,892, respectively. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY AND EQUIPMENT, NET | |
PROPERTY AND EQUIPMENT, NET | NOTE 5:- PROPERTY AND EQUIPMENT, NET December 31, 2020 2019 Cost: Computers and peripheral equipment $ 23,616 $ 22,105 Office furniture and equipment 12,004 *) 11,459 Leasehold improvements 3,213 *) 3,158 38,833 36,722 Accumulated depreciation: Computers and peripheral equipment 21,697 20,356 Office furniture and equipment 10,136 *) 9,722 Leasehold improvements 2,407 *) 2,252 34,240 32,330 Depreciated cost $ 4,593 $ 4,392 *) Reclassified. Depreciation expenses amounted to $1,936, $1,692 and $1,562 for the years ended December 31, 2020, 2019 and 2018, respectively. In the year ended December 31, 2019, the Company recorded a reduction of $12,381 to the cost and accumulated depreciation of fully depreciated equipment and leasehold improvements no longer in use, following an assessment made by the Company. In the year ended December 31, 2020, the Company did not record any such reduction. |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2020 | |
INTANGIBLE ASSETS, NET | |
INTANGIBLE ASSETS, NET | NOTE 6:- INTANGIBLE ASSETS, NET Useful life December 31, (years) 2020 2019 a. Impaired cost: Acquired technology and license 5 - 10 $ 19,857 $ 19,857 Customer relationship 4.5 - 9 4,750 4,750 24,607 24,607 Accumulated amortization: Acquired technology and license 19,299 19,027 Customer relationship 4,739 4,679 24,038 23,706 Amortized cost $ 569 $ 901 NOTE 6:- INTANGIBLE ASSETS, NET (Cont.) b. Amortization expenses related to intangible assets amounted to $332, $352 and $747 for the years ended December 31, 2020, 2019 and 2018, respectively. c. Expected amortization expenses are as follows: Year ending December 31, 2021 $ 284 2022 272 2023 13 $ 569 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2020 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | NOTE 7:- FAIR VALUE MEASUREMENTS In accordance with ASC 820, the Group measures its foreign currency derivative instruments, marketable securities and Active Communications Europe. (“ACS”) earn out liability related to the acquisition of ACS, at fair value. Investments in foreign currency derivative instruments and marketable securities are classified within Level 2 of the fair value hierarchy. This is because these assets (liabilities) are valued using alternative pricing sources and models utilizing market observable inputs. The ACS earn out liability was classified within Level 3 of the fair value hierarchy because this liability is based on present value calculations and an external valuation model whose inputs include market interest rates, estimated operational capitalization rates and volatilities. Unobservable inputs used in this model are significant. The Group’s financial assets and liabilities measured at fair value on a recurring basis, consisted of the following types of instruments as of the following dates: December 31, 2020 Fair value measurements using input type Level 2 Total Marketable securities $ 55,344 $ 55,344 Financial liabilities related to foreign currency derivative hedging contracts 1,489 1,489 Total financial net assets (liabilities) as of December 31, 2020 $ 56,833 $ 56,833 As of December 31, 2019, the Group had no financial instruments measured at fair value. Fair value measurements using significant unobservable inputs (Level 3): Balance at January 1, 2019 $ (433) Payment of earn out liability 410 Adjustment due to change in the forecast of earn out consideration 23 Balance at December 31, 2019 $ — |
OTHER PAYABLES AND ACCRUED EXPE
OTHER PAYABLES AND ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2020 | |
OTHER PAYABLES AND ACCRUED EXPENSES | |
OTHER PAYABLES AND ACCRUED EXPENSES | NOTE 8:- OTHER PAYABLES AND ACCRUED EXPENSES December 31, 2020 2019 Payroll and other employee related accruals $ 16,930 $ 13,147 Accrued expenses 7,152 7,173 Government authorities 1,475 2,331 Provision for return 2,962 1,885 Royalties provision 12 150 Sundry — 6 $ 28,531 $ 24,692 |
LONG-TERM BANK LOANS
LONG-TERM BANK LOANS | 12 Months Ended |
Dec. 31, 2020 | |
LONG-TERM BANK LOANS | |
LONG-TERM BANK LOANS | NOTE 9:- LONG-TERM BANK LOANS In December 2015, the Company entered into loan agreements with an Israeli commercial bank that provided loans in the total principal amounts of $3,000 and Euro 3,000 (the "2015 Loans"). Certain amounts of the 2015 Loans are required to be maintained as a compensating bank deposit that decreases as the loans are repaid. The loans bore interest at LIBOR plus 1%-2.5% and were repayable in 20 equal quarterly installments through December 2020. In December 2016, the Company entered into loan agreements with an Israeli commercial bank that provided loans in the total principal amount of $6,000 (the "2016 Loans"). Certain amounts of the 2016 Loans are required to be maintained as a compensating bank deposit that decreases over the repayment period of the loans. The loans bear interest at LIBOR plus 1.1%-2.5% and are repayable in 20 equal quarterly installments through December 2021. As of December 31, 2020 and 2019, the banks have a lien on the Company’s assets that secure the 2015 Loans and the 2016 Loans. As of December 31, 2020 and 2019, the Company is required to maintain a total of $600 and $1,800, respectively, in compensating balances with the banks, to secure the 2015 Loans and the 2016 Loans. As of December 31, 2020 and 2019, the compensating balances are included in short-term and restricted bank deposits in the amount of $600 and $1,200, respectively, and long-term and restricted bank deposits in the amount of $0 and $600, respectively. The amount of the compensating balances that is required decreases as the loans are repaid. The agreements with respect to the 2015 Loans and the 2016 Loans require the Company, among other things, to meet certain financial covenants such as maintaining shareholders’ equity, cash balances, and liabilities to banks at specified levels, as well as achieving certain levels of operating income (the "Covenants"). As of December 31, 2020 and 2019, the Company was in compliance with the Covenants. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2020 | |
LEASES | |
LEASES | NOTE 10:- LEASES a. The Group's facilities are leased under several lease agreements for periods ending up to 2027, with options to extend the leases ending up to 2029. In addition, the Company has various operating lease agreements with respect to motor vehicles. Lease expenses of office rent and vehicles for the years ended December 31, 2020, 2019 and 2018 were approximately $8,000, $8,149 and $8,325, respectively. Lease expenses for the years ended December 31, 2020, 2019 and 2018 include an offset for sublease rental of $1,405, $1,359 and $1,315, respectively. The Company’s capitalized operating lease agreements have remaining lease terms ranging from 1 year to 8.5 years, including agreements with options to extend NOTE 10:- LEASES (Cont.) The following table represents the weighted-average remaining lease term and discount rate: Year ended December 31, 2020 Weighted average remaining lease term 3.5 years Weighted average discount rate 2.08% The following table presents supplemental cash flows information related to the lease costs for operating and finance leases: December 31, 2020 Cash paid for amounts included in measurement of lease liabilities: Operating cash flows for operating leases $ 9,207 The discount rate was determined based on the estimated collateralized borrowing rate of the Company, adjusted to the specific lease term and location of each lease. Maturities of operating lease liabilities were as follows: Year ending December 31, 2021 $ 9,188 2022 8,333 2023 7,602 2024 1,485 2025 and thereafter 3,525 Total lease payments *) $ 30,133 Less- imputed interest $ 1,519 Present value of lease liabilities $ 28,614 *) Total lease payments have not been reduced by sublease rental payments of $ 3,097 In connection with the Company's offices lease agreement in Israel, the lessor has a lien of $5,100 which is included in short-term and restricted bank deposits. |
COMMITMENTS AND CONTINGENT LIAB
COMMITMENTS AND CONTINGENT LIABILITIES | 12 Months Ended |
Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENT LIABILITIES | |
COMMITMENTS AND CONTINGENT LIABILITIES | NOTE 11:- COMMITMENTS AND CONTINGENT LIABILITIES a. Inventory purchase commitments: The Group is obligated under certain agreements with its suppliers to purchase specified items of excess inventory which are expected to be utilized in 2021. As of December 31, 2020, non-cancelable purchase obligations were approximately $14,000. NOTE 11:- COMMITMENTS AND CONTINGENT LIABILITIES (Cont.) b. Royalty commitment to the IIA: Under the research and development agreements of the Company and its Israeli subsidiaries with the IIA and pursuant to applicable laws, the Company and its Israeli subsidiaries were required to pay royalties at the rate of 1.3%-5% on sales to end customers of products developed with funds provided by the IIA, up to an amount equal to 100% of the IIA research and development grants received, linked to the dollar plus interest on the unpaid amount received based on the 12-month LIBOR rate (from the year the grant was approved) applicable to dollar deposits. The Company and its Israeli subsidiaries were obligated to repay the IIA for the grants received only to the extent that there are sales of the funded products. In November 2019, the Company and its former Israeli subsidiary, AudioCodes Development Ltd., entered into a royalty buyout agreement (the “Royalty Buyout Agreement”) with the IIA relating to certain grants they had received from the IIA. The contingent net royalty liability to the IIA at the time of the Royalty Buyout Agreement with respect to these grants was $49,008 (the “Debt”), including interest to the date of the Royalty Buyout Agreement. As part of the Royalty Buyout Agreement, the Company agreed to pay $32,178 to the IIA (to settle the Debt in full) in three annual installments starting in 2019. The annual installments are denominated in NIS and bear interest. Pursuant to the Royalty Buyout Agreement, the Company eliminated all royalty obligations related to its future revenues with respect to these grants. In December 2020 and November 2019, the Company paid the two first installments of approximately $11,580 and $10,700 million, respectively, due under the Royalty Buyout Agreement. As of December 31, 2020, and 2019, the Company’s other Israeli subsidiaries have a contingent obligation to pay royalties in the amount of approximately $18,136 and $16,468, respectively. c. Royalty commitments to third parties: The Group has entered into technology licensing fee agreements with third parties. Under the agreements, the Group agreed to pay the third parties royalties, based on sales of relevant products. d. legal proceedings: In January 2021, a complaint for patent infringement was filed against the Company's U.S. subsidiary. The proceedings were served and no monetary demands were made at this stage. The Company is still assessing the merits of this case and at this stage does not believe that reserve is required. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2020 | |
SHAREHOLDERS' EQUITY | |
SHAREHOLDERS' EQUITY | NOTE 12:- SHAREHOLDERS’ EQUITY a. Treasury stock: During the year ended December 31, 2014, the Company’s Board of Directors approved a program to repurchase up to $3,000 of its ordinary shares (the "Share Repurchase Program"), which is the amount that the Company could repurchase according to Israeli law without further approval from an Israeli court. During the seven years ended December 31, 2020, the Company received Israeli court approvals to purchase up to an additional $176,000 of its ordinary shares. The most recent court approvals also permitted the Company to declare a dividend of any part of the related permitted amount during the approved validity period. In addition, in January 2021, the Company received court approval in Israel to repurchase up to an aggregate amount of $30 million of additional ordinary shares. The court approval also permits the Company to declare a dividend of any part of this amount. The approval is valid through July 19, 2021. As of December 31, 2020, pursuant to the Company’s Share Repurchase Program, the Company had repurchased a total of 29,471,614 of its ordinary shares at a total cost of $137,868 (of which none were repurchased during the year ended December 31, 2020). NOTE 12:- SHAREHOLDERS’ EQUITY (Cont.) b. Cash Dividend: On February 4, 2020, the Company declared a cash dividend of $0.13 per share. The dividend, in the aggregate amount of $3,866, was paid on March 4, 2020 to all of the Company’s shareholders of record on February 18, 2020. On August 5, 2020, the Company declared a cash dividend of 14 cents per share. The dividend, in the aggregate amount of $4,576 was paid on September 1, 2020 to all of the Company’s shareholders of record on August 17, 2020. See also Note 18. c. Issuance of ordinary shares: On June 8, 2020, the Company sold in a public offering 2,600,000 of its ordinary shares, at a price of $35 per share. The Company’s net proceeds from this offering were $85,426, after deducting underwriters’ discounts and commissions and other offering expenses. d. Employee and Non-Employee Share Option Plan: In 2008, the Company’s Board of Directors approved the 2008 Equity Incentive Plan (the "Plan") that became effective in January 2009. Under the Plan, options and RSUs may be granted to employees, officers, non-employee consultants and directors of the Company. As of December 31, 2020, the total number of shares authorized for future grant under the Plan is 1,361,118. Options granted under the Plan expire seven years from the date of grant and any options that are forfeited or cancelled before expiration become available for future grants. The following is a summary of the Company’s stock option activity and related information for the year ended December 31, 2020: Weighted average Weighted remaining average contractual Aggregate Amount exercise term (in intrinsic of options price years) value Options outstanding at beginning of year 1,341,073 $ 7.03 3.9 $ 25,021 Changes during the year: Granted 31,500 $ 23.05 Exercised (449,533) $ 5.80 Forfeited (8,125) $ 6.50 Options outstanding at end of year 914,915 $ 8.19 3.5 $ 17,709 Options exercisable at end of year 594,804 $ 6.34 2.7 $ 12,616 The weighted average grant-date fair value of options granted during the years ended December 31, 2020, 2019 and 2018 was $8.55, $6.63 and $3.02, per option, respectively. The aggregate intrinsic value in the table above represents the total intrinsic value (the difference between the Company’s closing share price on the last trading day of the fiscal year and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on the last trading day of the fiscal year. This amount changes based on the fair market value of the Company’s ordinary shares. NOTE 12:- SHAREHOLDERS’ EQUITY (Cont.) Total intrinsic value of options exercised for the years ended December 31, 2020, 2019 and 2018 was $10,633, $9,352 and $6,407, respectively. The following is a summary of the Company’s RSU activity and related information for the year ended December 31, 2020: Weighted Number of average grant shares date fair value RSUs outstanding at beginning of year 977,169 $ 11.00 Changes during the year: Granted 506,375 $ 31.53 Vested (399,198) $ 10.32 Forfeited (11,875) $ 16.98 RSUs outstanding at end of year 1,072,471 $ 20.88 As of December 31, 2020, there was a total of $15,063 unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the Plan. That cost is expected to be recognized over a weighted-average period of 3.21 years. The options for employees outstanding as of December 31, 2020 have been separated into ranges of exercise prices, as follows: Number of Weighted Number of options average options Weighted outstanding remaining Weighted exercisable average Range of as of contractual average as of exercise price exercise December 31, life (in exercise December 31, of exercisable price 2020 years) price 2020 options $ 3.54-4.80 288,229 1.57 $ 4.25 288,229 $ 4.25 $ 5.00-6.90 187,570 2.83 $ 6.33 150,987 $ 6.40 $ 7.08-10.66 203,366 4.56 $ 8.41 103,410 $ 8.66 $ 11.52-26.69 235,750 5.56 $ 14.31 52,178 $ 13.10 914,915 3.52 $ 8.19 594,804 $ 6.34 |
TAXES ON INCOME
TAXES ON INCOME | 12 Months Ended |
Dec. 31, 2020 | |
TAXES ON INCOME | |
TAXES ON INCOME | NOTE 13:- TAXES ON INCOME a. Israeli taxation: 1. Measurement of taxable income in U.S. dollars: The Company has elected to measure its taxable income and file its tax return under the Israeli Income Tax Regulations (Principles Regarding the Management of Books of Account of Foreign Invested Companies and Certain Partnerships and the Determination of Their Taxable Income), 1986. Accordingly, results for tax purposes are measured in terms of earnings in dollars. NOTE 13:- TAXES ON INCOME (Cont.) 2. Tax benefits under the Israeli Law for the Encouragement of Capital Investments, 1959 (the "Investment Law"): The Company’s production facilities in Israel have been granted the status of an "Approved Enterprise" in accordance with the Investment Law under four separate investment programs. On April 1, 2005, an amendment to the Investment Law came into effect (the "2005 Amendment") that significantly changed the provisions of the Investment Law. The 2005 Amendment limits the scope of enterprises that may be approved by the Investment Center by setting criteria for the approval of a facility as a "Beneficiary Enterprise". In January 2011, another amendment to the Investment Law came into effect (the "2011 Amendment"). According to the 2011 Amendment, the benefit tracks in the Investment Law were modified and a flat tax rate applies to the Company’s income subject to this amendment (the "Preferred Income"). Once an election is made, the Company’s income will be subject to the amended tax rate of 16% from 2015 and thereafter (or 9% for a preferred enterprise located in development area A). In December 2016, the Economic Efficiency Law (Legislative Amendments for Applying the Economic Policy for the 2016 and 2017 Budget Years), 2016, which includes Amendment 73 to the Investment Law ("Amendment 73") was published. According to Amendment 73, a preferred enterprise located in development area A will be subject to a tax rate of 7.5% instead of 9% effective from January 1, 2016 and thereafter (the tax rate applicable to preferred enterprises located in other areas remains at 16%). Amendment 73 also prescribes special tax tracks for technological enterprises, which are subject to regulations that were issued by the Minister of Finance in May 2017. The new tax tracks under Amendment 73 are as follows: Preferred Technological Enterprise ("PTE") - an enterprise for which total consolidated revenues of its parent company and all subsidiaries are less than NIS 10 billion. A PTE, as defined in the Investment Law, which is located in the center of Israel, will be subject to tax at a rate of 12% on profits deriving from intellectual property (in development area A - a tax rate of 7.5%). On May 2019, the Company notified the Israel Tax Authority that it had waived its Beneficiary Enterprise status starting from the 2019 tax year and thereafter. 3. Tax benefits under the law for the Encouragement of Industry (Taxes), 1969 (the "Encouragement Law"): The Encouragement Law provides several tax benefits for industrial companies. An industrial company is defined as a company resident in Israel, that at least 90% of the income of which in a given tax year exclusive of income from specified government loans, capital gains, interest and dividends, is derived from an industrial enterprise owned by it. An industrial enterprise is defined as an enterprise whose major activity in a given tax year is industrial production activity. Management believes that the Company is currently qualified as an "industrial company" under the Encouragement Law and, as such, is entitled to tax benefits, including: (i) deduction of purchase of know-how and patents and/or right to use a patent over an eight-year period; (ii) the right to elect, under specified conditions, to file a consolidated tax return with additional related Israeli industrial companies and an industrial holding company; (iii) accelerated depreciation rates on equipment and buildings; and (iv) expenses related to a public offering on the Tel Aviv Stock Exchange Ltd. and on recognized stock markets outside of Israel, such as Nasdaq, are deductible in equal amounts over three years. NOTE 13:- TAXES ON INCOME (Cont.) Eligibility for benefits under the Encouragement Law is not subject to receipt of prior approval from any governmental authority. No assurance can be given that the Israel Tax Authority will agree that the Company qualifies and will continue to qualify as an industrial company, or that the benefits described above will be available to the Company in the future. 4. Tax Benefits for Research and Development: Israeli tax law (Section 20a to the Israeli Tax Ordinance) allows, under certain conditions, a tax deduction for research and development expenses, including capital expenses, for the year in which they are paid. Such expenses must relate to scientific research in industry, agriculture, transportation, or energy, and must be approved by the relevant Israeli government ministry, determined by the field of research. Furthermore, the research and development must be for the promotion of the company's business and carried out by or on behalf of the company seeking such tax deduction. However, the amount of such deductible expenses is reduced by the sum of any funds received through government grants for the finance of such scientific research and development projects. As for expenses incurred in scientific research that is not approved by the relevant Israeli government ministry, they will be deductible over a three-year period starting from the tax year in which they are paid. The Company believes that it is eligible for the abovementioned benefit for the majority of its research and development expenses. 5. Tax rates: Taxable income of the Israeli Companies is subject to a corporate tax rate of 23% in the years ended December 31, 2018, 2019 and 2020. The Company is eligible for tax benefits as preferred technological enterprise mentioned above. The deferred tax balances as of December 31, 2020 have been calculated based on the PTE effective tax rate (see also a2 above). b. U.S. Tax Reform: In December 2017, the U.S. enacted significant tax reform through the Tax Cut and Jobs Act (“TCJA”). The TCJA enacted significant changes affecting the year ended December 31, 2017, including, but not limited to, (i) reducing the U.S. federal corporate income tax rate to 21%;and (ii) imposing a one-time Transition Tax (the "Transition Tax") on certain un-repatriated earnings of foreign subsidiaries of U.S. companies that had not been previously taxed in the U.S. The TJCA also established new tax provisions affecting 2018, including, but not limited to: (i) creating a new provision designed to tax global intangible low tax income (“GILTI”); (ii) generally eliminating U.S. federal taxes on dividends from foreign subsidiaries; (iii) eliminating the corporate alternative minimum tax (“AMT”); (iv) creating the base erosion anti-abuse tax (“BEAT”); (v) establishing a deduction for foreign derived intangible income ("FDII"); (vi) repealing domestic production activity deduction; and (vii) establishing new limitations on deductible interest expense and certain executive compensation. ASC 740 requires companies to account for the tax effects of changes in income tax rates and laws in the period in which legislation is enacted (December 22, 2017). ASC 740 does not specifically address accounting and disclosure guidance in connection with the income tax effects of the TCJA. The deferred tax balances as of December 31, 2020 and 2019 have been calculated based on the revised tax rates. NOTE 13:- TAXES ON INCOME (Cont.) The Group has completed the accounting for all the impacts of the TCJA. As part of finalizing the analysis, the Company’s U.S. subsidiary recorded adjustments that relate to the Transition Tax during 2018 and GILTI during 2020 in the total amounts of approximately $660 and $341, respectively. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") was enacted in the U.S. in response to the COVID-19 pandemic. The CARES Act contains temporary taxpayer favorable provisions related to the use of net operating losses and the deductibility of interest expense, charitable contributions, and qualified improvement property. The Company does not expect to be materially impacted by the CARES Act. c. Net operating loss carryforward: As of December 31, 2020, the Company has realized most of its carryforward tax losses in Israel, which can be offset against taxable income (except those stated in the merger agreement (see note 1d). As of December 31, 2020, the Company recorded a net deferred tax asset of $6,437 in respect of other temporary differences. As of December 31, 2020, the Company’s Israeli subsidiaries have total available carryforward tax losses of approximately $81,500. The net operating losses may be claimed and offset against taxable income in the future for an indefinite period. The Company’s U.S. subsidiary has total available carryforward tax losses of approximately $45,000 to offset against future U.S. federal taxable gains. These carryforward tax losses expire between 2021 and 2032. As of December 31, 2020, the Company’s U.S. subsidiary recorded a deferred tax asset of $5,411 in respect of such carryforward tax losses. Utilization of U.S. net operating losses may be subject to substantial annual limitations due to the "change in ownership" provisions of the Internal Revenue Code of 1986 and similar state provisions. The annual limitation may result in the expiration of net operating losses before utilization. d. Income (loss) before taxes on income is comprised as follows: Year Ended December 31, 2020 2019 2018 Domestic $ 30,008 $ (18,264) $ 10,084 Foreign 6,639 6,949 6,503 $ 36,647 $ (11,315) $ 16,587 NOTE 13:- TAXES ON INCOME (Cont.) e. Taxes on income (tax benefits) are comprised as follows: Year Ended December 31, 2020 2019 2018 Current taxes $ 742 $ 990 $ 843 Deferred tax expense (income) 8,657 (16,282) 2,251 $ 9,399 $ (15,292) $ 3,094 Domestic $ 7,519 $ (10,421) $ 1,610 Foreign 1,880 (4,871) 1,484 $ 9,399 $ (15,292) $ 3,094 f. Deferred income taxes: Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Group’s deferred tax liabilities and assets are as follows: December 31, 2020 2019 Deferred tax assets: Net operating loss carryforward $ 26,506 $ 31,391 Reserves and allowances 10,861 12,588 Net deferred tax assets before valuation allowance 37,367 43,979 Less - valuation allowance (25,286) (23,513) Deferred tax asset $ 12,081 $ 20,466 Deferred tax liability $ (206) $ (139) Deferred tax asset: Domestic 6,643 13,863 Foreign 5,438 6,603 $ 12,081 $ 20,466 Deferred tax liability: Foreign $ (206) $ (139) NOTE 13:- TAXES ON INCOME (Cont.) g. Reconciliation of the theoretical tax expenses: A reconciliation between the theoretical tax expense (benefit), assuming all income is taxed at the Israeli statutory corporate tax rate applicable to the income of the Company, and the actual tax expense (benefit) as reported in the statement of operations is as follows: Year Ended December 31, 2020 2019 2018 Income (loss) before taxes, as reported in the consolidated statements of operations $ 36,647 $ (11,315) $ 16,587 Israeli statutory corporate tax rate (*)11.5 % 23.0 % 23.0 % Theoretical tax expense (benefit) on the above amount at the Israeli statutory corporate tax rate $ 4,215 $ (2,602) $ 3,815 Income tax at rate other than the Israeli statutory corporate tax rate 1,201 78 458 Non-deductible expenses, including share-based compensation expenses 405 693 384 Losses for which valuation allowance was utilized (2,500) (12,076) (2,874) Changes in exchange rates of subsidiaries (1,324) (1,455) 1,388 Impact of rate change 6,931 — — Unrecognized tax benefits — — (386) Impact of TCJA in the U.S. — — 271 Other 471 70 38 Actual tax expense (benefit) $ 9,399 $ (15,292) $ 3,094 (*) The revised Israeli tax in accordance with the Company’s PTE effective tax rate h. Tax assessments: The statute of limitations related to tax returns of the Company for all tax years up to and including 2015 has lapsed. |
FINANCIAL INCOME (EXPENSES), NE
FINANCIAL INCOME (EXPENSES), NET | 12 Months Ended |
Dec. 31, 2020 | |
FINANCIAL INCOME (EXPENSES), NET | |
FINANCIAL INCOME (EXPENSES), NET | NOTE 14:- FINANCIAL INCOME (EXPENSES), NET Year Ended December 31, 2020 2019 2018 Financial expenses: Interest $ (657) $ (198) $ (266) Amortization of marketable securities premiums and accretion of discounts, net (172) (80) (353) Exchange rate differences (1,975) (2,171) (318) Other (171) (322) (265) (2,975) (2,771) (1,202) Financial income: Gain related to non-hedging derivative instruments 17 — 305 Interest and other 1,255 1,010 1,125 1,272 1,010 1,430 $ (1,703) $ (1,761) $ 228 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2020 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | NOTE 15:- EARNINGS PER SHARE Year Ended December 31, 2020 2019 2018 Numerator: Net income $ 27,248 $ 3,977 $ 13,493 Denominator: Denominator for basic earnings per share - weighted average number of ordinary shares, net of treasury stock 31,440,093 29,251,888 28,928,060 Effect of dilutive securities: Employee stock options, warrants and RSUs 1,475,590 1,548,016 1,291,746 Denominator for diluted earnings per share - adjusted weighted average number of shares 32,915,683 30,799,904 30,219,806 |
GEOGRAPHIC INFORMATION
GEOGRAPHIC INFORMATION | 12 Months Ended |
Dec. 31, 2020 | |
GEOGRAPHIC INFORMATION | |
GEOGRAPHIC INFORMATION | NOTE 16:- GEOGRAPHIC INFORMATION Summary information about geographic areas: The Group manages its business on a basis of one reportable segment (see Note 1 for a brief description of the Group’s business). The data is presented in accordance with ASC 280, "Segment Reporting". Revenues in the table below are attributed to geographical areas. based on the location of the end customers. The following presents total revenues for the years ended December 31, 2020, 2019 and 2018 and long-lived assets as of December 31, 2020, 2019 and 2018. Year Ended and as of December 31, 2020 2019 2018 Long- Long- Long- Total lived Total lived Total lived revenues assets revenues assets revenues assets Americas, principally the United States $ 103,190 $ 4,310 $ 97,453 $ 4,740 $ 86,636 $ 219 Europe 75,490 403 72,956 424 59,193 109 Far East 36,083 768 27,233 480 25,887 70 Israel 6,011 25,111 2,645 29,337 4,507 4,720 $ 220,774 $ 30,592 $ 200,287 $ 34,981 $ 176,223 $ 5,118 The Group has derived approximately 40% of its revenues for the year ended December 31, 2020 from sales in the United States. |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 12 Months Ended |
Dec. 31, 2020 | |
DERIVATIVE INSTRUMENTS | |
DERIVATIVE INSTRUMENTS | NOTE 17 :- DERIVATIVE INSTRUMENTS The Group enters into hedging transactions with a major financial institution, using derivative instruments, primarily forward contracts and options to purchase and sell foreign currencies, in order to reduce the net currency exposure associated with anticipated expenses (primarily salaries and rent expenses) in currencies other than the dollar. The Group currently hedges such future exposures for a maximum period of one year. However, the Group may choose not to hedge certain foreign currency exchange exposures for a variety of reasons, including but not limited to immateriality, accounting considerations and the prohibitive economic cost of hedging particular exposures. There can be no assurance the hedges will offset more than a portion of the financial impact resulting from movements in foreign currency exchange rates. The Group records all derivatives in the consolidated balance sheet at fair value. The effective portions of cash flow hedges are recorded in other comprehensive income until the hedged item is recognized in earnings. The ineffective portions of cash flow hedges are adjusted to fair value through earnings in financial income or expense. As of December 31, 2020, the Group had a net deferred gain associated with cash flow hedges of $1,319 recorded in other comprehensive income (loss). As of December 31, 2019, the Group had unrealized gain of $244 associated with cash flow hedges that was recorded in other comprehensive income (loss). As of December 31, 2020, the Group had outstanding forward and options collar (cylinder) contracts in the amount of $10,500 which were designated as payroll and rent hedging contracts. As of December 31, 2019, the Group had no The fair value of the Group's outstanding derivative instruments and the effect of derivative instruments in cash flow hedging relationship on other comprehensive income for the years ended December 31, 2020 and December 31, 2019 are summarized below: Foreign exchange forward December 31, December 31, and options contracts Balance sheet 2020 2019 Audited Audited Fair value of foreign exchange forward and options collar (cylinder) contracts "Other receivables and prepaid expenses" $ 1,489 $ — Gains recognized in other comprehensive income (effective portion) "Other comprehensive income (loss)" $ 1,319 $ 244 The effect of derivative instruments in cash flow hedging relationship on income for the years ended December 31, 2020 and 2019 is summarized below: Year Ended Foreign exchange forward Comprehensive December 31, and options contracts Income (loss) 2020 2019 Comprehensive income (loss) from derivatives before reclassifications "Other comprehensive income (loss)" $ 3,445 $ 535 Income (loss) reclassified from accumulated other comprehensive income (loss) (effective portion) "Operating expenses (income)" $ (2,126) $ (291) |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 12 Months Ended |
Dec. 31, 2020 | |
SUBSEQUENT EVENT | |
SUBSEQUENT EVENT | NOTE 18:- SUBSEQUENT EVENT On February 4, 2021, the Company declared a cash dividend of $0.16 per share. The dividend, in the aggregate amount of approximately $5.3 million, was paid on March 4, 2021 to all of the Company’s shareholders of record on February 18, 2021. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
SIGNIFICANT ACCOUNTING POLICIES | |
Use of estimates | a. Use of estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. The Company's management believes that the estimates, judgments and assumptions used are reasonable based upon information available at the time they are made. As applicable to these interim condensed consolidated financial statements, the most significant estimates and assumptions relate to revenue recognition and allowance for sales returns, allowance for doubtful accounts, inventories write-off, intangible assets, goodwill, income taxes and valuation allowance, share-based compensation and contingent liabilities. Actual results could differ from those estimates. In light of the currently unknown extent and duration of the COVID-19 pandemic, the Company faces a greater degree of uncertainty than normal in making the judgments and estimates needed to apply certain of the Company's significant accounting policies. The Company assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to the Company and the unknown future impacts COVID-19 as of December 31, 2020 and through the date of issuance of this report. These estimates may change, as new events occur and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions. |
Financial statements in U.S. dollars ("dollars") | b. Financial statements in U.S. dollars ("dollars"): A majority of the Group’s revenues is generated in dollars. In addition, most of the Group’s costs are denominated and determined in dollars and in new Israeli shekels ("NIS"). Management believes that the dollar is the currency in the primary economic environment in which the Group operates. Thus, the functional and reporting currency of the Group is the dollar. Accordingly, monetary accounts maintained in currencies other than the dollar are remeasured into dollars in accordance with Accounting Standards Codification ("ASC") 830, "Foreign Currency Matters". All transaction gains and losses of the remeasured monetary balance sheet items are reflected in the statements of operations as financial income or expenses, as appropriate. |
Principles of consolidation | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) c. Principles of consolidation: The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany transactions and balances, including profits from intercompany sales not yet realized outside the Group, have been eliminated upon consolidation. |
Cash equivalents | d. Cash equivalents: Cash equivalents represent short-term highly liquid investments that are readily convertible into cash with original maturities of three months or less at the date acquired. |
Short-term and restricted bank deposits | e. Short-term and restricted bank deposits: Short-term and restricted bank deposits are deposits with maturities of more than three months, but less than one year. The deposits are mainly in dollars and bear interest at an average annual rate of 0.97% and 1.88% for the years ended December 31, 2020 and 2019, respectively. Short-term and restricted deposits are presented at cost. Any accrued interest on these deposits is included in other receivables and prepaid expenses. In connection with long-term bank loans and their related covenants, the Company is required to maintain compensating balances with the banks and to maintain deposits in the same banks that provided the loans to the Company (see Note 9).In addition, the Company maintains restricted deposits in connection with an office lease agreement (see also Note 10a). Out of the short-term and restricted bank deposits, a total of $5,910 and $6,409, are restricted short-term deposits as of December 31, 2020 and 2019, respectively. |
Marketable securities | f. Marketable securities: The Group accounts for investments in debt securities in accordance with ASC 320, "Investments - Debt and Equity Securities". Management determines the appropriate classification of its investments in marketable debt securities at the time of purchase and reevaluates such determinations at each balance sheet date. As of December 31, 2020, the Group classified all of its marketable securities as available-for-sale (“AFS”). AFS securities are carried at fair value, with the unrealized gains and losses, net of tax, reported in “accumulated other comprehensive loss” in shareholders’ equity. Realized gains and losses on sale of investments are included in “financial income (expenses), net” and are derived using the specific identification method for determining the cost of securities. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. Such amortization, together with interest on securities, is included in "financial income (expenses), net". The Group assessed AFS debt securities with an amortized cost basis in excess of estimated fair value to determine what amount of that difference, if any, is caused by expected credit losses in accordance with ASC 326, "Financial Instruments - Credit Losses". Allowance for credit losses on AFS debt securities are recognized as a charge in other income (expenses), net, on the consolidated statements of operation, and any remaining unrealized losses, net of taxes, are included in accumulated other comprehensive income (loss) in stockholders' equity. The Group has not recorded credit losses for the year ended December 31,2020. |
Inventories | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) g. Inventories: Inventories are stated at the lower of cost or market value. Cost is determined as follows: Raw materials - using the "weighted average cost" method; and Finished products - using the "weighted average cost" method with the addition of direct manufacturing costs. The Group periodically evaluates the quantities on hand relative to current and historical selling prices, historical and projected sales volume and technological obsolescence. Based on these evaluations, inventory write-offs are taken based on slow moving items, technological obsolescence, excess inventories, discontinuation of product lines, and market prices lower than cost. |
Long-term and restricted bank deposits | h. Long-term and restricted bank deposits: Bank deposits and the related accrued interest with maturities of more than one year are included in long-term investments and presented at their cost. Accrued interest that is payable within a one-year period is included in other receivables and prepaid expenses. The deposits are denominated in dollars and bear interest at an average annual rate of 0% and 2.16% for the years ended December 31, 2020 and 2019, respectively. Out of the total long-term bank deposits, a total of $0 and $600 are restricted long-term deposits as of December 31, 2020 and 2019, respectively. |
Property and equipment | i. Property and equipment: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated by the straight-line method over the estimated useful lives of the assets at the following annual rates: Computers and peripheral equipment 33% Office furniture and equipment 6% – 20% (mainly 15%) Leasehold improvements Over the shorter of the term of the lease, or the useful life of the assets The Group’s long-lived assets (asset group) to be held and used, including right of use assets and intangible that are subject to amortization are reviewed for impairment in accordance with ASC 360-10-35, "Property, Plant and Equipment - Subsequent Measurement" whenever events or changes in circumstances indicate that the carrying amount of an asset (or asset group) may not be recoverable. If such assets are considered to be impaired, recoverability of assets (asset group) to be held and used is measured by a comparison of the carrying amount of an asset (asset group) to the future undiscounted cash flows expected to be generated by the asset. The impairment to be recognized is measured by the amount by which the carrying amount of the assets (asset groups) exceeds the fair value of the assets (asset groups). During the years ended December 31, 2020, 2019 and 2018, no impairment losses have been identified for property and equipment. |
Intangible assets | j. Intangible assets: Intangible assets are comprised of acquired technology, customer relations and licenses. Intangible assets that are not considered to have an indefinite useful life are amortized using the straight-line basis over their estimated useful lives, which range from 4.5 to 10 years. Recoverability of these assets is measured by a comparison of the carrying amount of the asset to the undiscounted future cash flows expected to be generated by the assets. If the assets are considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired assets. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) During the years ended December 31, 2020, 2019 and 2018, no impairment losses have been identified with respect to intangible assets. |
Leases | k. Leases: The Company adopted Accounting Standards Update ("ASU") 2016-02, "Leases (Topic 842)", or "ASC 842") on January 1, 2019, using the modified retrospective approach, by applying ASC 842 to all leases existing at the date of initial application. The standard requires lessees to recognize almost all leases on the balance sheet as a right-of-use asset and a lease liability and requires leases to be classified as either an operating or a finance type lease. The standard excludes leases of intangible assets or inventory. Leases with a term of 12 months or less can be accounted for in a manner similar to the accounting for operating leases under ASC 840. The new standard requires lessors to account for leases using an approach that is substantially equivalent to ASC 840 for sales-type leases, direct financing leases and operating leases. The Company determines if an arrangement is a lease at inception. Lease classification is governed by five criteria in ASC 842-10-25-2. If any of these five criteria is met, the Company classifies the lease as a finance lease. Otherwise, the Company classifies the lease as an operating lease. The Company uses incremental borrowing rates based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The right-of use asset also includes any lease payments made and excludes lease incentives. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expenses are recognized on a straight-line basis over the lease term or the useful life of the leased asset. In addition, the carrying amount of the right-of use asset and lease liabilities are remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset. |
Goodwill | l. Goodwill: Goodwill and certain other purchased intangible assets have been recorded as a result of acquisitions. Goodwill represents the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill is not amortized, but rather is subject to an impairment test. The Group performs an annual impairment test during the fourth quarter of each fiscal year, or more frequently if impairment indicators are present. The Group operates in one operating segment, and this segment comprises its only reporting unit. Goodwill is not amortized, but rather is subject to an impairment test. In accordance with ASC 350, "Intangibles – Goodwill and Other", at least annually (in the fourth quarter), or more frequently if events or changes in circumstances indicate that the carrying value may be impaired. The Company has an option to perform a qualitative assessment to determine whether it is more-likely-than-not that the fair value of a reporting unit is less than its carrying value prior to performing the quantitative goodwill impairment test. The Company operates in one operating segment, and this segment comprises its only reporting unit. Following the adoption of ASU 2017-04, "Simplifying the Test for Goodwill Impairment", as part of the quantitative goodwill impairment test, any excess of the carrying value of the reporting unit over its fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to the fair value of the reporting unit. For each of the three years in the period ended December 31, 2020, the Group performed an annual impairment analysis, using market capitalization, and no impairment losses have been identified. |
Revenue recognition | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) m. Revenue recognition: The Group generates its revenues primarily from the sale of products through a direct sales force and sales representatives. The Group’s products are delivered to its customers, which include original equipment manufacturers, network equipment providers, systems integrators and distributors in the telecommunications and networking industries, all of whom are considered end-users. Revenues are recognized in accordance with ASC 606, "Revenue from Contracts with Customers". The Group recognizes revenue under the core principle that transfer of control to a customer of the Group generates revenue in an amount reflecting the consideration the Group expects to receive from the customer. As such, the Group identifies a contract with a customer, identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to each performance obligation in the contract and recognizes revenues when (or as) the Group satisfies a performance obligation. Product revenues are recognized when all performance obligations are satisfied, at the point of time when control is transferred, the product has been delivered and the benefit of the asset has been transferred. Revenues from support are recognized ratably over the term of the underlying contract term. Renewals of support contracts create new performance obligations that are satisfied over the term with the revenues recognized ratably over the period. For professional services, the performance obligations are satisfied, and revenues are recognized, when the services are provided or once the service term has expired. The Group enters into contracts that can include combinations of products and services that are capable of being distinct and accounted for as separate performance obligations. The products are distinct upon delivery as the customer can derive the economic benefit of it without any professional services, updates or technical support. The Group allocates the transaction price to each performance obligation, based on its relative standalone selling price out of the total consideration of the contract. For support, the Group determines the standalone selling prices, based on the price at which the Group separately sells a renewal contract on a standalone basis. For professional services, the Group determines the standalone selling prices based on the price at which the Group separately sells those services on a standalone basis. The Group’s products contain a significant element relating to its proprietary technology and its solutions offer substantially different features and functionality. As a result, the comparable pricing of products with similar functionality typically cannot be obtained. Additionally, as the Group is unable to reliably determine the selling prices of comparable products sold by competitors and generally does not sell the products separately on a standalone basis, the standalone selling prices are not directly observable. Therefore, the Group makes estimates, based on reasonably available information. The estimated selling price is established considering multiple factors including, but not limited to, pricing practices in different geographical areas and through different sales channels, gross margin objectives, internal costs, the pricing strategies of competitors and industry technology lifecycles. The Group grants to certain customers a right of return or the ability over a limited period to exchange for other products a specific percentage of the total price paid for products they have purchased. The Group maintains a provision for product returns and exchanges and other incentives, based on its experience with historical sales returns, analysis of credit memo data and other known factors, all in accordance with ASC 606. This provision is deducted from revenues and amounted to $2,962 and $1,885 as of December 31, 2020 and 2019, respectively. This provision was recorded as part of other payables and accrued expenses. Deferred revenues include amounts invoiced to customers for which revenue has not yet been recognized. Deferred revenues are recognized as (or when) the Group performs the performance obligations under the contract. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The Group pays sales commissions to sales and marketing personnel, based on their attainment of certain predetermined sales goals. Some sales commissions for support earned by its employees are capitalized and amortized on a straight line basis over the related contractual support period. Amortization expenses related to these costs are included in selling and marketing expenses in the consolidated statements of operations. The Group has included as part of other receivables and prepaid expenses in its consolidated balance sheet, costs to obtain a contract in the amount of $665 and $460, as of December 31, 2020 and 2019, respectively. In addition, the Group's consolidated statement of operations included a reduction of expenses, in the net amount of $205, $38 and $242 for the years ended December 31, 2020 ,2019 and 2018, respectively. Remaining performance obligations represents contracted revenues that have not yet been recognized, which includes deferred revenues and non-cancelable contracts that will be recognized as revenue in future periods. The following table represents the remaining performance obligations as of December 31, 2020, which are expected to be satisfied and recognized in future periods: Year Ending December 31, 2023 and 2021 2022 thereafter Product $ 295 $ 72 $ 8 Services 36,887 5,187 6,687 $ 37,182 $ 5,259 $ 6,695 Significant changes in the balances of deferred revenues during the period are as follows: December 31, 2020 2019 Balance, at the beginning of the year $ 43,230 $ 29,962 Revenue recognized (31,172) (17,577) Increase in deferred revenues and customer advances 37,078 30,845 Balance, at the end of the year 49,136 43,230 Less current portion (37,182) (33,538) Long term portion $ 11,954 $ 9,692 |
Warranty costs | n. Warranty costs: The Group usually provides an assurance-type warranty for a period of 12 months at no extra charge. The Group estimates the costs that may be incurred under its basic limited warranty and records a liability in the amount of such costs at the time product revenue is recognized. Factors that affect the Group’s warranty liability include the number of installed units, historical and anticipated rates of warranty claims, and cost per claim. The Group periodically assesses the adequacy of its recorded warranty liability and adjusts the amount as necessary. As of December 31, 2020 and 2019, the provision for warranty amounted to $253 and $284, respectively. |
Research and development costs | o. Research and development costs: ASC 985-20, "Costs of Software to Be Sold, Leased, or Marketed", requires capitalization of certain software development costs subsequent to the establishment of technological feasibility. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Based on the Company’s product development process, technological feasibility is established upon the completion of a working model. The Company does not incur material costs between the completion of a working model and the point at which the products are ready for general release. Therefore, research and development costs are charged to the consolidated statement of operations, as incurred. Participation grants from the Israel Innovation Authority (formerly known as the Office of the Chief Scientist of the Israeli Ministry of Economy and Industry) (the "IIA") for research and development activity are recognized at the time the Company is entitled to such grants on the basis of the costs incurred and included as a deduction of research and development costs. Research and development grants recognized during the years ended December 31, 2020, 2019 and 2018 were $388, $1,323 and $5,734, respectively. |
Income taxes | p. Income taxes: The Group accounts for income taxes in accordance with ASC 740, "Income Taxes". ASC 740 prescribes the use of the liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax bases of assets and liabilities and for carry forward tax losses. Deferred taxes are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Group records a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value if it is more-likely-than-not that some portion of or the entire amount of the deferred tax asset will not be realized. In addition, ASC 740 prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The first step is to evaluate the tax position taken or expected to be taken in a tax return. This is done by determining if the weight of available evidence indicates that it is more-likely-than-not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. Interest and penalties assessed by taxing authorities on an underpayment of income taxes are included as a component of income tax expense in the consolidated statements of operations. |
Accumulated other comprehensive income (loss) ("AOCI") | q. Accumulated other comprehensive income (loss) ("AOCI"): The Company accounts for comprehensive income (loss) in accordance with ASC 220, "Comprehensive Income", which establishes standards for the reporting and presentation of comprehensive income (loss) and its components in a full set of general purpose financial statements. Comprehensive income (loss) generally represents all changes in shareholders’ equity during the period except those resulting from investments by, or distributions to, shareholders. NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The components of AOCI were as follows: Unrealized gains on available- Unrealized for-sale gains (losses) marketable on cash flow securities hedges Total Balance as of January 1, 2020 $ — $ — $ — Other comprehensive income before reclassifications, net of tax 453 3,445 3,898 Amounts reclassified from AOCI — (2,126) (2,126) Other comprehensive income, net of tax 453 1,319 1,772 Balance as of December 31, 2020 $ 453 $ 1,319 $ 1,772 The effects on net income of amounts reclassified from AOCI in the year ended December 31, 2020 derive from realized losses on cash flow hedges recorded in operating expenses and from realized losses on available-for-sale marketable securities recorded in financial income (expenses), net. |
Concentrations of credit risk | r. Concentrations of credit risk: Financial instruments that potentially subject the Group to concentrations of credit risk consist principally of cash and cash equivalents, bank deposits, trade receivables, marketable securities and foreign currency derivative contracts. The majority of the Group’s cash and cash equivalents, bank deposits and foreign currency derivative contracts are invested in dollar denominated instruments with major banks in Israel and the United States. Such investments in the United States may be in excess of insured limits and are not insured in other jurisdictions. Management believes that the financial institutions that hold the Group’s investments are corporations with high credit standing. Accordingly, management believes that low credit risk exists with respect to these financial investments. Marketable securities include investments in dollar-denominated corporate bonds. Marketable securities consist of highly liquid debt instruments with high credit standing. The Company’s investment policy, approved by the Board of Directors, limits the amount the Group may invest in any one type of investment or issuer, thereby reducing credit risk concentrations. Management believes that the Group’s portfolio is well diversified and, accordingly, minimal credit risk exists with respect to these marketable debt securities. The trade receivables of the Group are derived from sales to customers located primarily in the Americas, the Far East, Israel and Europe. Under certain circumstances, the Group may require letters of credit, other collateral, additional guarantees or advance payments. Regarding certain credit balances, the Group is covered by foreign trade risk insurance. The Group performs ongoing credit evaluations of its customers and establishes an allowance for doubtful accounts based upon a specific review. |
Earnings per share | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) s. Earnings per share: Basic earnings per share are computed based on the weighted average number of ordinary shares outstanding during each year. Diluted earnings per share are computed based on the weighted average number of ordinary shares outstanding during each year, plus potential dilutive ordinary shares considered outstanding during the year, in accordance with ASC 260, "Earnings per Share". Certain outstanding options, restricted share units ("RSUs") and warrants have been excluded from the calculation of the diluted earnings per share since such securities are anti-dilutive for all years presented. The total weighted average number of shares related to the outstanding options, RSUs and warrants that have been excluded from the calculation of diluted earnings per share was 64,312, 48,491 and 158,832 for the years ended December 31, 2020, 2019 and 2018, respectively. |
Accounting for share-based compensation | t. Accounting for share-based compensation: The Company accounts for share-based compensation in accordance with ASC 718, "Compensation-Stock Compensation". ASC 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company’s consolidated statement of operations. The weighted-average estimated fair value of employee stock options granted during the years ended December 31, 2020, 2019 and 2018, was $8.55, $6.63 and $3.02 per share, respectively, using the Black-Scholes option pricing model. Fair values were estimated using the following weighted-average assumptions (annualized percentages): Year Ended December 31, 2020 2019 2018 Dividend yield 1.01%-1.17% 1.13%-1.64% 0%-2.66% Expected volatility 37.89%-43.09% 38.08%-39.34% 37.74%-41.72% Risk-free interest 0.29%-1.43% 1.66%-2.59% 2.40%-3.06% Expected life 3.57-4.23 years 4.75-5.21 years 4.78-5.27 years The Company used its historical volatility in accordance with ASC 718. The computation of volatility uses historical volatility derived from the Company's exchange traded shares. The expected term of options granted is estimated based on historical experience and represents the period of time that options granted are expected to be outstanding. The risk free interest rate assumption is the implied yield currently available on United States treasury zero-coupon issues with a remaining term equal to the expected life of the Company's options. The dividend yield assumption is based on the Company's historical experience and expectation of future dividend payouts and may be subject to substantial change in the future. The Company paid its first cash dividend during the third quarter of 2018 and has been paying cash dividends on a bi-annual basis since then. The Company currently expects to continue pay cash dividends in the future, subject to receipt of required Israeli court approvals, although there can be no assurance that it will do so. See also Note 12. The total share-based compensation expenses relating to all of the Company’s share-based awards recognized for the years ended December 31, 2020, 2019 and 2018 were included in items of the consolidated statements of operations, as follows: NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Year Ended December 31, 2020 2019 2018 Cost of revenues $ 181 $ 183 $ 186 Research and development expenses, net 1,535 937 651 Selling and marketing expenses 3,635 2,171 1,238 General and administrative expenses 3,420 2,001 1,212 Total share-based compensation expenses $ 8,771 $ 5,292 $ 3,287 |
Treasury stock | u. Treasury stock: The Company has repurchased its ordinary shares from time to time in the open market, and holds such repurchased shares as treasury stock. The Company presents the cost to repurchase treasury stock as a reduction of shareholders’ equity. See also Note 12a. |
Severance pay | v. Severance pay: The liability for severance pay for Israeli employees is calculated pursuant to the Israeli Severance Pay Law, 1963 (the "Severance Pay Law"), based on the most recent salary of the employees multiplied by the number of years of employment as of the balance sheet date for all employees in Israel. Employees who have been employed for more than a one-year period are entitled to one month’s salary for each year of employment or a portion thereof. The Group’s liability for all of its Israeli employees is fully provided for by monthly deposits with severance pay funds, pension funds, insurance policies and by an accrual. The value of these deposits is recorded as an asset in the Company’s consolidated balance sheet. The deposited funds include profits accumulated up to the consolidated balance sheets date. The deposited funds may be withdrawn only upon the fulfillment of the obligation pursuant to the Severance Pay Law or labor agreements. Since March 2011, the Group’s agreements with new Israeli employees are under Section 14 of the Severance Pay Law. The Group’s contributions for severance pay have replaced its severance pay obligation. Upon contribution of the full amount of the employee’s monthly salary for each year of service, no additional calculations are conducted between the parties regarding the matter of severance pay and no additional payments are made by the Group to the employee upon termination. The Group is legally released from the obligations to employees once the deposit amounts have been paid, and therefore the severance pay liability is not reflected in the balance sheet. Severance pay expenses for the years ended December 31, 2020, 2019 and 2018, amounted to $3,078, $2,324 and $2,680, respectively. |
Employee benefit plan | w. Employee benefit plan: The Group has 401(k) defined contribution plans covering employees in the U.S. All eligible employees may elect to contribute a portion of their annual compensation to the plan through salary deferrals, subject to the IRS limit of $19.5 during the years ended December 31, 2019 and 2020, plus a catch-up contribution of $6.5 for participants age 50 or over. The Group matches 50% of employees’ contributions, up to a maximum of 6% of the employees’ annual pay. In the years ended December 31, 2020, 2019 and 2018, the Group matched contributions in the amount of $386, $318 and $308, respectively. |
Advertising expenses | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) x. Advertising expenses: Advertising expenses are charged to the statements of operations as incurred. Advertising expenses for the years ended December 31, 2020, 2019 and 2018 amounted to $371, $669 and $627, respectively. |
Fair value of financial instruments | y. Fair value of financial instruments: The estimated fair value of financial instruments has been determined by the Group using available market information and valuation methodologies. Considerable judgment is required in estimating fair values. Accordingly, the estimates may not be indicative of the amounts the Group could realize in a current market exchange. The following methods and assumptions were used by the Group in estimating its fair value disclosures for financial instruments: The carrying amounts of cash and cash equivalents, short-term and restricted bank deposits, trade receivables, trade payables, other receivables and prepaid expenses and other payables and accrued expenses approximate their fair value due to the short-term maturity of such instruments.The fair value of long-term and restricted bank deposits and long-term bank loans also approximates their carrying value, since they bear interest at rates close to the prevailing market rates. The fair value of foreign currency contracts is estimated by obtaining current quotes from banks and market observable data of similar instruments. The fair value of marketable securities is estimated by obtaining the fair value of the marketable securities from the bank, which is based on current quotes and market value provided by external service providers. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, ASC 820, "Fair Value Measurements and Disclosures" establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 - Observable inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. Level 3 - Unobservable inputs which are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. See also Note 8. |
Derivatives and hedging | z. Derivatives and hedging: The Group accounts for derivative instruments and hedging based on ASC 815, "Derivatives and Hedging". NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The Group accounts for its derivative instruments as either assets or liabilities and carries them at fair value. Derivative instruments that are not designated and qualified as hedging instruments must be adjusted to fair value through earnings. The changes in fair value of such instruments are included as gain or loss in "financial income (expenses), net" at each reporting period. For derivative instruments that hedge the exposure to variability in expected future cash flows that are designated as cash flow hedges, the effective portion of the gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive loss in equity and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings and is classified as payroll and rent expenses. The ineffective portion of the gain or loss on the derivative instrument is recognized in current earnings and included in "financial income (expenses), net". To receive hedge accounting treatment, cash flow hedges must be highly effective in offsetting changes to expected future cash flows on hedged transactions. |
Recently adopted accounting standards | aa. Recently adopted accounting standards: In January 2017, the Financial Accounting Standards Board (the "FASB") issued ASU 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment" ("ASU 2017-04"). ASU 2017-04 eliminates the requirement to measure the implied fair value of goodwill by assigning the fair value of a reporting unit to all assets and liabilities within that unit (the "Step 2 test") from the goodwill impairment test. Instead, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, limited by the amount of goodwill in that reporting unit. ASU 2017-04 became effective for the Company beginning January 1, 2020. The implementation did not have a material impact on our condensed consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, "Financial Instruments-Credit Losses (Topic 326)" ("ASU 2016-13"). ASU 2016-13 requires that financial assets measured at amortized cost be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. ASU 2016-13 became effective for the Company beginning January 1, 2020. The implementation did not have a material impact on our condensed consolidated financial statements. |
Impact of recently issued accounting standard not yet adopted | ab. Impact of recently issued accounting standard not yet adopted: In December 2019, the FASB issued ASU 2019-12, "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes" ("ASU 2019-12"), which simplifies the accounting for income taxes. This guidance will be effective for the first quarter of 2021 on a prospective basis, with early adoption permitted. The Company is currently reviewing ASU 2019-12, but does not expect that it will, when adopted, have a material impact on our consolidated financial statements. |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of estimated useful lives of the assets | Computers and peripheral equipment 33% Office furniture and equipment 6% – 20% (mainly 15%) Leasehold improvements Over the shorter of the term of the lease, or the useful life of the assets |
Schedule of remaining performance obligations which are expected to be satisfied and recognized in future periods | Year Ending December 31, 2023 and 2021 2022 thereafter Product $ 295 $ 72 $ 8 Services 36,887 5,187 6,687 $ 37,182 $ 5,259 $ 6,695 |
Schedule Of Equity Based Compensation Expenses Table Text Block | The total share-based compensation expenses relating to all of the Company’s share-based awards recognized for the years ended December 31, 2020, 2019 and 2018 were included in items of the consolidated statements of operations, as follows: NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Year Ended December 31, 2020 2019 2018 Cost of revenues $ 181 $ 183 $ 186 Research and development expenses, net 1,535 937 651 Selling and marketing expenses 3,635 2,171 1,238 General and administrative expenses 3,420 2,001 1,212 Total share-based compensation expenses $ 8,771 $ 5,292 $ 3,287 |
Schedule of components of AOCI | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The components of AOCI were as follows: Unrealized gains on available- Unrealized for-sale gains (losses) marketable on cash flow securities hedges Total Balance as of January 1, 2020 $ — $ — $ — Other comprehensive income before reclassifications, net of tax 453 3,445 3,898 Amounts reclassified from AOCI — (2,126) (2,126) Other comprehensive income, net of tax 453 1,319 1,772 Balance as of December 31, 2020 $ 453 $ 1,319 $ 1,772 |
Schedule of weighted-average assumptions | Year Ended December 31, 2020 2019 2018 Dividend yield 1.01%-1.17% 1.13%-1.64% 0%-2.66% Expected volatility 37.89%-43.09% 38.08%-39.34% 37.74%-41.72% Risk-free interest 0.29%-1.43% 1.66%-2.59% 2.40%-3.06% Expected life 3.57-4.23 years 4.75-5.21 years 4.78-5.27 years |
MARKETABLE SECURITIES AND ACC_2
MARKETABLE SECURITIES AND ACCRUED INTEREST (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
MARKETABLE SECURITIES AND ACCRUED INTEREST | |
Schedule of available-for-sale marketable securities | The following is a summary of available-for-sale marketable securities: December 31, 2020 Amortized Unrealized Unrealized Fair cost gains losses Value Maturing between one to five years: Corporate bonds $ 53,351 $ 508 (6) $ 53,853 Governmental bonds 1,055 — (13) 1,042 Accrued interest 449 — — 449 Balance as of December 31, 2020 $ 54,855 $ 508 $ (19) $ 55,344 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INVENTORIES | |
Schedule of inventories | December 31, 2020 2019 Raw materials $ 13,376 $ 10,700 Finished products 15,817 17,575 $ 29,193 $ 28,275 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY AND EQUIPMENT, NET | |
Schedule of property and equipment, net | December 31, 2020 2019 Cost: Computers and peripheral equipment $ 23,616 $ 22,105 Office furniture and equipment 12,004 *) 11,459 Leasehold improvements 3,213 *) 3,158 38,833 36,722 Accumulated depreciation: Computers and peripheral equipment 21,697 20,356 Office furniture and equipment 10,136 *) 9,722 Leasehold improvements 2,407 *) 2,252 34,240 32,330 Depreciated cost $ 4,593 $ 4,392 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INTANGIBLE ASSETS, NET | |
Schedule of intangible assets, net | Useful life December 31, (years) 2020 2019 a. Impaired cost: Acquired technology and license 5 - 10 $ 19,857 $ 19,857 Customer relationship 4.5 - 9 4,750 4,750 24,607 24,607 Accumulated amortization: Acquired technology and license 19,299 19,027 Customer relationship 4,739 4,679 24,038 23,706 Amortized cost $ 569 $ 901 |
Schedule of expected amortization expenses | Year ending December 31, 2021 $ 284 2022 272 2023 13 $ 569 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
FAIR VALUE MEASUREMENTS | |
Schedule of financial assets and liabilities measured at fair value on a recurring basis | The Group’s financial assets and liabilities measured at fair value on a recurring basis, consisted of the following types of instruments as of the following dates: December 31, 2020 Fair value measurements using input type Level 2 Total Marketable securities $ 55,344 $ 55,344 Financial liabilities related to foreign currency derivative hedging contracts 1,489 1,489 Total financial net assets (liabilities) as of December 31, 2020 $ 56,833 $ 56,833 |
Schedule of fair value measurements using significant unobservable inputs (Level 3) | Fair value measurements using significant unobservable inputs (Level 3): Balance at January 1, 2019 $ (433) Payment of earn out liability 410 Adjustment due to change in the forecast of earn out consideration 23 Balance at December 31, 2019 $ — |
OTHER PAYABLES AND ACCRUED EX_2
OTHER PAYABLES AND ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
OTHER PAYABLES AND ACCRUED EXPENSES | |
Schedule of other payables and accrued expenses | December 31, 2020 2019 Payroll and other employee related accruals $ 16,930 $ 13,147 Accrued expenses 7,152 7,173 Government authorities 1,475 2,331 Provision for return 2,962 1,885 Royalties provision 12 150 Sundry — 6 $ 28,531 $ 24,692 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LEASES | |
Schedule of weighted-average remaining lease term and discount rate | Year ended December 31, 2020 Weighted average remaining lease term 3.5 years Weighted average discount rate 2.08% |
Schedule of supplemental cash flow information related to lease costs | December 31, 2020 Cash paid for amounts included in measurement of lease liabilities: Operating cash flows for operating leases $ 9,207 |
Schedule of maturities of operating lease liabilities | Year ending December 31, 2021 $ 9,188 2022 8,333 2023 7,602 2024 1,485 2025 and thereafter 3,525 Total lease payments *) $ 30,133 Less- imputed interest $ 1,519 Present value of lease liabilities $ 28,614 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SHAREHOLDERS' EQUITY | |
Summary of the stock option activity and related information | The following is a summary of the Company’s stock option activity and related information for the year ended December 31, 2020: Weighted average Weighted remaining average contractual Aggregate Amount exercise term (in intrinsic of options price years) value Options outstanding at beginning of year 1,341,073 $ 7.03 3.9 $ 25,021 Changes during the year: Granted 31,500 $ 23.05 Exercised (449,533) $ 5.80 Forfeited (8,125) $ 6.50 Options outstanding at end of year 914,915 $ 8.19 3.5 $ 17,709 Options exercisable at end of year 594,804 $ 6.34 2.7 $ 12,616 |
Summary of the RSU activity and related information | The following is a summary of the Company’s RSU activity and related information for the year ended December 31, 2020: Weighted Number of average grant shares date fair value RSUs outstanding at beginning of year 977,169 $ 11.00 Changes during the year: Granted 506,375 $ 31.53 Vested (399,198) $ 10.32 Forfeited (11,875) $ 16.98 RSUs outstanding at end of year 1,072,471 $ 20.88 |
Schedule of options for employees outstanding have been separated into ranges of exercise prices | The options for employees outstanding as of December 31, 2020 have been separated into ranges of exercise prices, as follows: Number of Weighted Number of options average options Weighted outstanding remaining Weighted exercisable average Range of as of contractual average as of exercise price exercise December 31, life (in exercise December 31, of exercisable price 2020 years) price 2020 options $ 3.54-4.80 288,229 1.57 $ 4.25 288,229 $ 4.25 $ 5.00-6.90 187,570 2.83 $ 6.33 150,987 $ 6.40 $ 7.08-10.66 203,366 4.56 $ 8.41 103,410 $ 8.66 $ 11.52-26.69 235,750 5.56 $ 14.31 52,178 $ 13.10 914,915 3.52 $ 8.19 594,804 $ 6.34 |
TAXES ON INCOME (Tables)
TAXES ON INCOME (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
TAXES ON INCOME | |
Schedule of income (loss) before taxes on income | Year Ended December 31, 2020 2019 2018 Domestic $ 30,008 $ (18,264) $ 10,084 Foreign 6,639 6,949 6,503 $ 36,647 $ (11,315) $ 16,587 |
Schedule of taxes on income (tax benefits) | Year Ended December 31, 2020 2019 2018 Current taxes $ 742 $ 990 $ 843 Deferred tax expense (income) 8,657 (16,282) 2,251 $ 9,399 $ (15,292) $ 3,094 Domestic $ 7,519 $ (10,421) $ 1,610 Foreign 1,880 (4,871) 1,484 $ 9,399 $ (15,292) $ 3,094 |
Summary of significant components of the deferred tax liabilities and assets | f. Deferred income taxes: Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Group’s deferred tax liabilities and assets are as follows: December 31, 2020 2019 Deferred tax assets: Net operating loss carryforward $ 26,506 $ 31,391 Reserves and allowances 10,861 12,588 Net deferred tax assets before valuation allowance 37,367 43,979 Less - valuation allowance (25,286) (23,513) Deferred tax asset $ 12,081 $ 20,466 Deferred tax liability $ (206) $ (139) Deferred tax asset: Domestic 6,643 13,863 Foreign 5,438 6,603 $ 12,081 $ 20,466 Deferred tax liability: Foreign $ (206) $ (139) |
Schedule of reconciliation of the theoretical tax expense (benefit) | g. Reconciliation of the theoretical tax expenses: A reconciliation between the theoretical tax expense (benefit), assuming all income is taxed at the Israeli statutory corporate tax rate applicable to the income of the Company, and the actual tax expense (benefit) as reported in the statement of operations is as follows: Year Ended December 31, 2020 2019 2018 Income (loss) before taxes, as reported in the consolidated statements of operations $ 36,647 $ (11,315) $ 16,587 Israeli statutory corporate tax rate (*)11.5 % 23.0 % 23.0 % Theoretical tax expense (benefit) on the above amount at the Israeli statutory corporate tax rate $ 4,215 $ (2,602) $ 3,815 Income tax at rate other than the Israeli statutory corporate tax rate 1,201 78 458 Non-deductible expenses, including share-based compensation expenses 405 693 384 Losses for which valuation allowance was utilized (2,500) (12,076) (2,874) Changes in exchange rates of subsidiaries (1,324) (1,455) 1,388 Impact of rate change 6,931 — — Unrecognized tax benefits — — (386) Impact of TCJA in the U.S. — — 271 Other 471 70 38 Actual tax expense (benefit) $ 9,399 $ (15,292) $ 3,094 (*) The revised Israeli tax in accordance with the Company’s PTE effective tax rate |
FINANCIAL INCOME (EXPENSES), _2
FINANCIAL INCOME (EXPENSES), NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
FINANCIAL INCOME (EXPENSES), NET | |
Schedule of financial income (expenses), net | Year Ended December 31, 2020 2019 2018 Financial expenses: Interest $ (657) $ (198) $ (266) Amortization of marketable securities premiums and accretion of discounts, net (172) (80) (353) Exchange rate differences (1,975) (2,171) (318) Other (171) (322) (265) (2,975) (2,771) (1,202) Financial income: Gain related to non-hedging derivative instruments 17 — 305 Interest and other 1,255 1,010 1,125 1,272 1,010 1,430 $ (1,703) $ (1,761) $ 228 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
EARNINGS PER SHARE | |
Schedule of earnings per share | Year Ended December 31, 2020 2019 2018 Numerator: Net income $ 27,248 $ 3,977 $ 13,493 Denominator: Denominator for basic earnings per share - weighted average number of ordinary shares, net of treasury stock 31,440,093 29,251,888 28,928,060 Effect of dilutive securities: Employee stock options, warrants and RSUs 1,475,590 1,548,016 1,291,746 Denominator for diluted earnings per share - adjusted weighted average number of shares 32,915,683 30,799,904 30,219,806 |
GEOGRAPHIC INFORMATION (Tables)
GEOGRAPHIC INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
GEOGRAPHIC INFORMATION | |
Schedule of total revenues | The following presents total revenues for the years ended December 31, 2020, 2019 and 2018 and long-lived assets as of December 31, 2020, 2019 and 2018. Year Ended and as of December 31, 2020 2019 2018 Long- Long- Long- Total lived Total lived Total lived revenues assets revenues assets revenues assets Americas, principally the United States $ 103,190 $ 4,310 $ 97,453 $ 4,740 $ 86,636 $ 219 Europe 75,490 403 72,956 424 59,193 109 Far East 36,083 768 27,233 480 25,887 70 Israel 6,011 25,111 2,645 29,337 4,507 4,720 $ 220,774 $ 30,592 $ 200,287 $ 34,981 $ 176,223 $ 5,118 |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
DERIVATIVE INSTRUMENTS | |
Schedule of fair value of outstanding derivative instruments | The fair value of the Group's outstanding derivative instruments and the effect of derivative instruments in cash flow hedging relationship on other comprehensive income for the years ended December 31, 2020 and December 31, 2019 are summarized below: Foreign exchange forward December 31, December 31, and options contracts Balance sheet 2020 2019 Audited Audited Fair value of foreign exchange forward and options collar (cylinder) contracts "Other receivables and prepaid expenses" $ 1,489 $ — Gains recognized in other comprehensive income (effective portion) "Other comprehensive income (loss)" $ 1,319 $ 244 |
Schedule of cash flow hedging relationship on income | Foreign exchange forward December 31, December 31, and options contracts Balance sheet 2020 2019 Audited Audited Fair value of foreign exchange forward and options collar (cylinder) contracts "Other receivables and prepaid expenses" $ 1,489 $ — Gains recognized in other comprehensive income (effective portion) "Other comprehensive income (loss)" $ 1,319 $ 244 |
GENERAL - Additional Informatio
GENERAL - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Entity-Wide Revenue, Major Customer, Percentage | 13.50% | 16.00% | 17.80% |
Additional Major Customer [Member] | |||
Entity-Wide Revenue, Major Customer, Percentage | 13.00% | 13.50% | 11.10% |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES - Property and equipment (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Computers and peripheral equipments [Member] | |
Disclosure On Annual Depreciation Rate Using Straight Line Method | 33% |
Office furniture and equipment | |
Disclosure On Annual Depreciation Rate Using Straight Line Method | 6% – 20% (mainly 15%) |
Leaseholds and Leasehold Improvements [Member] | |
Disclosure On Annual Depreciation Rate Using Straight Line Method | Over the shorter of the term of the lease, or the useful life of the assets |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES - Remaining performance obligations (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year |
Remaining performance obligations | $ 37,182 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | Product [Member] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | 295 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | Service [Member] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 36,887 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year |
Remaining performance obligations | $ 5,259 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | Product [Member] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | 72 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | Service [Member] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 5,187 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year |
Remaining performance obligations | $ 6,695 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | Product [Member] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | 8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | Service [Member] | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 6,687 |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES - Components of AOCI (Details) - Other Comprehensive Income (Loss) [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Balance as of January 1, 2020 | $ 0 |
Other comprehensive income before reclassifications, net of tax | 3,898 |
Amounts reclassified from AOCI | (2,126) |
Other comprehensive income, net of tax | 1,772 |
Balance as of December 31, 2020 | 1,772 |
Unrealized gains (losses) on Available-For-Sale Marketable Securities | |
Balance as of January 1, 2020 | 0 |
Other comprehensive income before reclassifications, net of tax | 453 |
Amounts reclassified from AOCI | 0 |
Other comprehensive income, net of tax | 453 |
Balance as of December 31, 2020 | 453 |
Unrealized gains (losses) on cash flow hedges | |
Balance as of January 1, 2020 | 0 |
Other comprehensive income before reclassifications, net of tax | 3,445 |
Amounts reclassified from AOCI | (2,126) |
Other comprehensive income, net of tax | 1,319 |
Balance as of December 31, 2020 | $ 1,319 |
SIGNIFICANT ACCOUNTING POLICI_7
SIGNIFICANT ACCOUNTING POLICIES - Weighted average estimated fair value of employee stock (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Minimum [Member] | |||
Dividend yield | 1.01% | 1.13% | 0.00% |
Expected volatility | 37.89% | 38.08% | 37.74% |
Risk-free interest | 0.29% | 1.66% | 2.40% |
Expected life | 3 years 6 months 25 days | 4 years 9 months | 4 years 9 months 10 days |
Maximum [Member] | |||
Dividend yield | 1.17% | 1.64% | 2.66% |
Expected volatility | 43.09% | 39.34% | 41.72% |
Risk-free interest | 1.43% | 2.59% | 3.06% |
Expected life | 4 years 2 months 23 days | 5 years 2 months 15 days | 5 years 3 months 7 days |
SIGNIFICANT ACCOUNTING POLICI_8
SIGNIFICANT ACCOUNTING POLICIES - Share based compensation expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Total share-based compensation expenses | $ 8,771 | $ 5,292 | $ 3,287 |
Cost of Revenues [Member] | |||
Total share-based compensation expenses | 181 | 183 | 186 |
Research and Development Expense [Member] | |||
Total share-based compensation expenses | 1,535 | 937 | 651 |
Selling and Marketing Expense [Member] | |||
Total share-based compensation expenses | 3,635 | 2,171 | 1,238 |
General and Administrative Expense [Member] | |||
Total share-based compensation expenses | $ 3,420 | $ 2,001 | $ 1,212 |
SIGNIFICANT ACCOUNTING POLICI_9
SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Short Term Bank Deposits Bear Interest Average Rate | 0.97% | 1.88% | |
Restricted Short Term Deposits | $ 5,910 | $ 6,409 | |
Long Term Bank Deposits Bear Interest Average Rate | 0.00% | 2.16% | |
Restricted Long Term Deposits | $ 0 | $ 600 | |
Antidilutive Securities and Outstanding Options, RSUs and Warrants Excluded from Computation of Earings Per Share, Amount | 64,312 | 48,491 | 158,832 |
Severance Cost | $ 3,078 | $ 2,324 | $ 2,680 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 8.55 | $ 6.63 | $ 3.02 |
Defined Benefit Plan, Plan Assets, Contributions by Employer | $ 386 | $ 318 | $ 308 |
Advertising Expense | $ 371 | 669 | 627 |
Defined Contribution Plan, Description | All eligible employees may elect to contribute a portion of their annual compensation to the plan through salary deferrals, subject to the IRS limit of $19.5 during the years ended December 31, 2019 and 2020, plus a catch-up contribution of $6.5 for participants age 50 or over. The Group matches 50% of employees’ contributions, up to a maximum of 6% of the employees’ annual pay. | ||
Operating Lease, Right-of-Use Asset | $ 25,430 | 29,688 | |
Operating Lease, Liability | 28,614 | ||
Investments in marketable securities | 0 | ||
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||
Costs and Expenses | 205 | 242 | |
Other Receivables And Prepaid Expenses [Member] | |||
Contract with Customer, Asset, Net | 665 | 460 | |
Grant [Member] | |||
Revenue from Contract with Customer, Including Assessed Tax | $ 388 | 1,323 | $ 5,734 |
Minimum [Member] | |||
Finite-Lived Intangible Asset, Useful Life | 4 years 6 months | ||
Maximum [Member] | |||
Finite-Lived Intangible Asset, Useful Life | 10 years | ||
SEC Schedule, 12-09, Reserve, Warranty [Member] | |||
Valuation Allowances and Reserves, Balance | $ 253 | 284 | |
Allowance For Sales Return [Member] | |||
Provision for Sales Return | $ 2,962 | $ 1,885 |
MARKETABLE SECURITIES AND ACC_3
MARKETABLE SECURITIES AND ACCRUED INTEREST (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Amortized cost | $ 54,855 |
Unrealized gains | 508 |
Unrealized losses | (19) |
Fair Value | 55,344 |
Corporate Debt Securities [Member] | Maturing between One to Five Year [Member] | |
Amortized cost | 53,351 |
Unrealized gains | 508 |
Unrealized losses | (6) |
Fair Value | 53,853 |
Accrued Interest [Member] | |
Amortized cost | 449 |
Unrealized gains | 0 |
Unrealized losses | 0 |
Fair Value | $ 449 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
INVENTORIES | ||
Raw materials | $ 13,376 | $ 10,700 |
Finished products | 15,817 | 17,575 |
Inventory, Net | $ 29,193 | $ 28,275 |
INVENTORIES - Additional inform
INVENTORIES - Additional information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INVENTORIES | |||
Inventory Write-down | $ 4,175 | $ 4,493 | $ 1,892 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property, plant and equipment, Cost | $ 38,833 | $ 36,722 |
Accumulated depreciation | 34,240 | 32,330 |
Depreciated cost | 4,593 | 4,392 |
Computers and Peripheral Equipment [Member] | ||
Property, plant and equipment, Cost | 23,616 | 22,105 |
Accumulated depreciation | 21,697 | 20,356 |
Office Furniture And Equipment [Member] | ||
Property, plant and equipment, Cost | 12,004 | 11,459 |
Accumulated depreciation | 10,136 | 9,722 |
Leasehold Improvements [Member] | ||
Property, plant and equipment, Cost | 3,213 | 3,158 |
Accumulated depreciation | $ 2,407 | $ 2,252 |
PROPERTY AND EQUIPMENT, NET - A
PROPERTY AND EQUIPMENT, NET - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
PROPERTY AND EQUIPMENT, NET | |||
Depreciation | $ 1,936 | $ 1,692 | $ 1,562 |
INTANGIBLE ASSETS, NET (Details
INTANGIBLE ASSETS, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets, Gross | $ 24,607 | $ 24,607 |
Finite-Lived Intangible Assets, Accumulated amortization | 24,038 | 23,706 |
Finite-Lived Intangible Assets, Net | $ 569 | 901 |
Maximum [Member] | ||
Finite-Lived Intangible Asset, Useful Life | 10 years | |
Minimum [Member] | ||
Finite-Lived Intangible Asset, Useful Life | 4 years 6 months | |
Acquired Technology [Member] | ||
Finite-Lived Intangible Assets, Gross | $ 19,857 | 19,857 |
Finite-Lived Intangible Assets, Accumulated amortization | $ 19,299 | 19,027 |
Acquired Technology [Member] | Maximum [Member] | ||
Finite-Lived Intangible Asset, Useful Life | 10 years | |
Acquired Technology [Member] | Minimum [Member] | ||
Finite-Lived Intangible Asset, Useful Life | 5 years | |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets, Gross | $ 4,750 | 4,750 |
Finite-Lived Intangible Assets, Accumulated amortization | $ 4,739 | $ 4,679 |
Customer Relationships [Member] | Maximum [Member] | ||
Finite-Lived Intangible Asset, Useful Life | 9 years | |
Customer Relationships [Member] | Minimum [Member] | ||
Finite-Lived Intangible Asset, Useful Life | 4 years 6 months |
INTANGIBLE ASSETS, NET - Expect
INTANGIBLE ASSETS, NET - Expected amortization expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
INTANGIBLE ASSETS, NET | ||
2021 | $ 284 | |
2022 | 272 | |
2023 | 13 | |
Finite-Lived Intangible Assets, Net | $ 569 | $ 901 |
INTANGIBLE ASSETS, NET - Additi
INTANGIBLE ASSETS, NET - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INTANGIBLE ASSETS, NET | |||
Amortization of Intangible Assets | $ 332 | $ 352 | $ 747 |
FAIR VALUE MEASUREMENTS - The G
FAIR VALUE MEASUREMENTS - The Group's financial assets and liabilities measured at fair value on a recurring basis (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Marketable securities | $ 0 |
Fair Value, Measurements, Recurring [Member] | |
Marketable securities | 55,344 |
Financial liabilities related to foreign currency derivative hedging contracts | 1,489 |
Total financial net assets (liabilities) | (56,833) |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | |
Marketable securities | 55,344 |
Financial liabilities related to foreign currency derivative hedging contracts | 1,489 |
Total financial net assets (liabilities) | $ (56,833) |
FAIR VALUE MEASUREMENTS - Fair
FAIR VALUE MEASUREMENTS - Fair value measurements using significant unobservable inputs (Level 3) (Details) - Fair Value, Inputs, Level 3 [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Balance at January 1, 2019 | $ (433) |
Payment of earn out liability | 410 |
Adjustment due to change in the forecast of earn-out consideration | $ 23 |
OTHER PAYABLES AND ACCRUED EX_3
OTHER PAYABLES AND ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
OTHER PAYABLES AND ACCRUED EXPENSES | ||
Payroll and other employee related accruals | $ 16,930 | $ 13,147 |
Accrued expenses | 7,152 | 7,173 |
Government authorities | 1,475 | 2,331 |
Provision for return | 2,962 | 1,885 |
Royalties provision | 12 | 150 |
Others | 0 | 6 |
Other Payables And Accrued Expenses | $ 28,531 | $ 24,692 |
LONG-TERM BANK LOANS (Details)
LONG-TERM BANK LOANS (Details) € in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2015EUR (€) | |
Compensating Bank Deposit Included In Short Term Deposit | $ 600 | $ 1,200 | |||
Compensating Bank Deposit Included In Long Term Deposit | 0 | 600 | |||
Compensating Bank Deposit | $ 600 | $ 1,800 | |||
Loans With Israeli Commercial Banks 2015 [Member] | |||||
Debt Instrument, Face Amount | $ 3,000 | € 3,000 | |||
Debt Instrument, Interest Rate Terms | LIBOR plus 1%-2.5% | ||||
Debt Instrument, Frequency of Periodic Payment | 20 equal quarterly installments through December 2020. | ||||
Loans With Israeli Commercial Banks 2016 [Member] | |||||
Debt Instrument, Face Amount | $ 6,000 | ||||
Debt Instrument, Interest Rate Terms | LIBOR plus 1.1%-2.5% | ||||
Debt Instrument, Frequency of Periodic Payment | 20 equal quarterly installments through December 2021. |
LEASES - Weighted-average remai
LEASES - Weighted-average remaining lease term and discount rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Lessee, Lease, Description [Line Items] | |||
Lease expenses | $ 8,000 | $ 8,149 | $ 8,325 |
Sublease rental income | $ 1,405 | $ 1,359 | $ 1,315 |
Lessee, Operating Lease, Existence of Option to Extend [true false] | true | ||
Extension term | 5 years | ||
Weighted average remaining lease term | 3 years 6 months | ||
Weighted average discount rate | 2.08% | ||
Minimum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 1 year | ||
Maximum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 8 years 6 months |
LEASES - Supplemental cash flow
LEASES - Supplemental cash flows information related to the lease costs for operating and financing leases (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Cash paid for amounts included in measurement of lease liabilities: | |
Operating cash flows for operating leases | $ 9,207 |
LEASES - Maturities of operatin
LEASES - Maturities of operating lease liabilities (Details) $ in Thousands | Dec. 31, 2020USD ($) |
LEASES | |
2021 | $ 9,188 |
2022 | 8,333 |
2023 | 7,602 |
2024 | 1,485 |
2025 and thereafter | 3,525 |
Total lease payments | 30,133 |
Less - imputed interest | (1,519) |
Present value of lease liabilities | 28,614 |
Sublease rental payments receivable | 3,097 |
Approximate Amount of Lien by Lessor | $ 5,100 |
COMMITMENTS AND CONTINGENT LI_2
COMMITMENTS AND CONTINGENT LIABILITIES (Details) $ in Thousands | 1 Months Ended | ||
Dec. 31, 2020USD ($)installment | Nov. 30, 2019USD ($)installment | Dec. 31, 2019USD ($) | |
Approximate Amount of Lien by Lessor | $ 5,100 | ||
Purchase Obligation | $ 14,000 | ||
Maximum Amount Of Royalties To Be Paid Out Of Research And Development Grants Received | 100.00% | ||
Number of installments paid | installment | 2 | 2 | |
Royalty Buyout Agreement [Member] | |||
Accrued Royalties | $ 49,008 | ||
Number of annual installments | installment | 3 | ||
Installment amount | $ 32,178 | ||
Installment amount paid | $ 11,580,000 | $ 10,700,000 | |
Royalty Agreement Terms [Member] | |||
Contractual Obligation | $ 18,136 | $ 16,468 | |
Product Manufacturing In Israel [Member] | Minimum [Member] | |||
Rate Of Royalties Payable As Percentage On Sales | 1.30% | ||
Product Manufacturing In Israel [Member] | Maximum [Member] | |||
Rate Of Royalties Payable As Percentage On Sales | 5.00% |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 04, 2021 | Aug. 05, 2020 | Jun. 08, 2020 | Feb. 04, 2020 | Feb. 29, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Mar. 04, 2021 | Dec. 31, 2014 |
Class of Stock [Line Items] | ||||||||||
Stock Repurchase Program, Authorized Amount | $ 3,000 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 8.55 | $ 6.63 | $ 3.02 | |||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options | $ 15,063 | |||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 3 years 2 months 15 days | |||||||||
Additional Stock Repurchase Program Authorized Amount | $ 30 | $ 176,000 | ||||||||
Treasury stock, shares | 29,471,614 | 29,471,614 | ||||||||
Dividend payable Percent Per Share | $ 14 | $ 0.13 | ||||||||
Dividends Payable | $ 4,576 | $ 3,866 | ||||||||
Issuance of ordinary shares, Value | $ 85,426 | |||||||||
Share price | $ 35 | |||||||||
Issuance of ordinary shares, Shares | 2,600,000 | |||||||||
Proceeds from issuance of shares in a public offering, net | $ 85,426 | $ 0 | 0 | |||||||
Dividends Payable, Date to be Paid | Sep. 1, 2020 | Mar. 4, 2020 | ||||||||
Dividends Payable, Date of Record | Aug. 17, 2020 | Feb. 18, 2020 | ||||||||
Subsequent Event [Member] | ||||||||||
Class of Stock [Line Items] | ||||||||||
Dividends Payable | $ 5,300 | |||||||||
Dividends Payable, Date to be Paid | Mar. 4, 2021 | |||||||||
Dividends Payable, Date of Record | Feb. 18, 2021 | |||||||||
Share Repurchase Program [Member] | ||||||||||
Class of Stock [Line Items] | ||||||||||
Treasury stock, shares | 29,471,614 | |||||||||
Stock Redeemed or Called During Period, Value | $ 137,868 | |||||||||
Stock Repurchased and Retired During Period, Shares | 0 | |||||||||
Employee And Non-employee Stock Option Plan [Member] | ||||||||||
Class of Stock [Line Items] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 1,361,118 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 10,633 | $ 9,352 | $ 6,407 |
SHAREHOLDERS' EQUITY - Summary
SHAREHOLDERS' EQUITY - Summary of the Company's RSU activity and related information (Details) - Restricted Stock Units (RSUs) [Member] | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Stockholders' Equity Note [Line Items] | |
Number of shares, RSUs outstanding at beginning of year | 977,169 |
Number of shares, Granted | 506,375 |
Number of shares, Vested | (399,198) |
Number of shares, Forfeited | (11,875) |
Number of shares, RSUs outstanding at end of year | 1,072,471 |
Weighted average grant date fair value, RSUs Outstanding at beginning of year | 11 |
Weighted average grant date fair value, Granted | $ / shares | $ 31.53 |
Weighted average grant date fair value, Vested | $ / shares | 10.32 |
Weighted average grant date fair value, Forfeited | $ / shares | $ 16.98 |
Weighted average grant date fair value, RSUs outstanding at end of year | 20.88 |
SHAREHOLDERS' EQUITY - Summar_2
SHAREHOLDERS' EQUITY - Summary of the Company's stock option activity and related information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
SHAREHOLDERS' EQUITY | ||
Amount of options, outstanding at beginning of year | 1,341,073 | |
Amount of options, Granted | 31,500 | |
Amount of options, Exercised | (449,533) | |
Amount of options, Forfeited | (8,125) | |
Amount of options, outstanding at end of year | 914,915 | 1,341,073 |
Amount of options, exercisable at end of year | 594,804 | |
Weighted average exercise price, outstanding at beginning of year | $ 7.03 | |
Weighted average exercise price, Granted | 23.05 | |
Weighted average exercise price, Exercised | 5.80 | |
Weighted average exercise price, Forfeited | 6.50 | |
Weighted average exercise price, Options outstanding at end of year | 8.19 | $ 7.03 |
Weighted average exercise price, Option exercisable at end of year | $ 6.34 | |
Weighted average remaining contractual term, Options outstanding (in years) | 3 years 6 months | 3 years 10 months 24 days |
Weighted average remaining contractual term, Options exercisable at end of year (in years) | 2 years 8 months 12 days | |
Aggregate intrinsic value, outstanding | $ 25,021 | |
Aggregate intrinsic value, outstanding | 17,709 | $ 25,021 |
Aggregate intrinsic value, Options exercisable at end of year | $ 12,616 |
SHAREHOLDERS' EQUITY - Ranges o
SHAREHOLDERS' EQUITY - Ranges of exercise prices (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options outstanding | 914,915 | 1,341,073 |
Weighted average exercise price | $ 8.19 | $ 7.03 |
Number of options exercisable | 594,804 | |
Weighted average exercise price of exercisable options | $ 6.34 | |
Warrant [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options outstanding | 914,915 | |
Weighted average remaining contractual life (in years) | 3 years 6 months 7 days | |
Weighted average exercise price | $ 8.19 | |
Number of options exercisable | 594,804 | |
Weighted average exercise price of exercisable options | $ 6.34 | |
Range Of Exercise Price $3.54-4.80 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options outstanding | 288,229 | |
Weighted average remaining contractual life (in years) | 1 year 6 months 25 days | |
Weighted average exercise price | $ 4.25 | |
Number of options exercisable | 288,229 | |
Weighted average exercise price of exercisable options | $ 4.25 | |
Range Of Exercise Price $5.00-6.90 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options outstanding | 187,570 | |
Weighted average remaining contractual life (in years) | 2 years 9 months 29 days | |
Weighted average exercise price | $ 6.33 | |
Number of options exercisable | 150,987 | |
Weighted average exercise price of exercisable options | $ 6.40 | |
Range Of Exercise Price $7.08-10.66 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options outstanding | 203,366 | |
Weighted average remaining contractual life (in years) | 4 years 6 months 21 days | |
Weighted average exercise price | $ 8.41 | |
Number of options exercisable | 103,410 | |
Weighted average exercise price of exercisable options | $ 8.66 | |
Range of Exercise Price $11.52-26.69 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options outstanding | 235,750 | |
Weighted average remaining contractual life (in years) | 5 years 6 months 21 days | |
Weighted average exercise price | $ 14.31 | |
Number of options exercisable | 52,178 | |
Weighted average exercise price of exercisable options | $ 13.10 |
TAXES ON INCOME - Income (loss)
TAXES ON INCOME - Income (loss) before taxes on income is comprised (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
TAXES ON INCOME | |||
Domestic | $ 30,008 | $ (18,264) | $ 10,084 |
Foreign | 6,639 | 6,949 | 6,503 |
Income (loss) before taxes on income | $ 36,647 | $ (11,315) | $ 16,587 |
TAXES ON INCOME - Taxes on inco
TAXES ON INCOME - Taxes on income (tax benefits) are comprised (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
TAXES ON INCOME | |||
Current taxes | $ 742 | $ 990 | $ 843 |
Deferred tax expense (income) | 8,657 | (16,282) | 2,251 |
Income Tax Expense (Benefit) | 9,399 | (15,292) | 3,094 |
Domestic | 7,519 | (10,421) | 1,610 |
Foreign | 1,880 | (4,871) | 1,484 |
Income Tax Expense (Benefit) | $ 9,399 | $ (15,292) | $ 3,094 |
TAXES ON INCOME - Significant c
TAXES ON INCOME - Significant components of the Group's deferred tax liabilities and assets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Net operating loss carryforward | $ 26,506 | $ 31,391 |
Reserves and allowances | 10,861 | 12,588 |
Net deferred tax assets before valuation allowance | 37,367 | 43,979 |
Less - valuation allowance | (25,286) | (23,513) |
Deferred tax asset | 12,081 | 20,466 |
Deferred tax liability | (206) | (139) |
Domestic Tax Authority [Member] | ||
Deferred tax assets: | ||
Deferred tax asset | 6,643 | 13,863 |
Foreign Tax Authority [Member] | ||
Deferred tax assets: | ||
Deferred tax asset | 5,438 | 6,603 |
Deferred tax liability | $ (206) | $ (139) |
TAXES ON INCOME - Reconciliatio
TAXES ON INCOME - Reconciliation of the theoretical tax expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
TAXES ON INCOME | |||
Income (loss) before taxes, as reported in the consolidated statements of operations | $ 36,647 | $ (11,315) | $ 16,587 |
Israeli statutory corporate tax rate | 11.50% | 23.00% | 23.00% |
Theoretical tax expense (benefit) on the above amount at the Israeli statutory corporate tax rate | $ 4,215 | $ (2,602) | $ 3,815 |
Income tax at rate other than the Israeli statutory corporate tax rate | 1,201 | 78 | 458 |
Non-deductible expenses, including share-based compensation expenses | 405 | 693 | 384 |
Losses for which valuation allowance was provided (utilized) | (2,500) | (12,076) | (2,874) |
Changes in exchange rates of subsidiaries | (1,324) | (1,455) | 1,388 |
Impact of rate change | 6,931 | 0 | 0 |
Unrecognized Tax Benefits | 0 | 0 | (386) |
Impact of TCJA | 0 | 0 | 271 |
Other | 471 | 70 | 38 |
Income Tax Expense (Benefit) | $ 9,399 | $ (15,292) | $ 3,094 |
TAXES ON INCOME (Details)
TAXES ON INCOME (Details) $ in Thousands, ₪ in Billions | 12 Months Ended | ||||
Dec. 31, 2020ILS (₪) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018 | Jan. 31, 2011 | |
Percentage Of Amendment Tax Rate | 16.00% | ||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 11.50% | 11.50% | 23.00% | 23.00% | |
Minimum Percentage of Income from its Core Activity | 90.00% | 90.00% | |||
TCJA [Member] | |||||
Income Tax Credits and Adjustments | $ 660 | ||||
GILTI [Member] | |||||
Income Tax Credits and Adjustments | $ 341 | ||||
Preferred Enterprise Located In Development Area A [Member] | |||||
Effective Income Tax Rate Reconciliation, Percent | 12.00% | 12.00% | |||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 7.50% | 7.50% | |||
Preferred Enterprise Located in Other Area [Member] | |||||
Effective Income Tax Rate Reconciliation, Percent | 16.00% | 16.00% | |||
U S Subsidiaries [Member] | |||||
Deferred Tax Assets, Net | $ 5,411 | ||||
Thereafter [Member] | |||||
Percentage Of Amendment Tax Rate | 9.00% | ||||
Minimum [Member] | Preferred Enterprise Located In Development Area A [Member] | |||||
Effective Income Tax Rate Reconciliation, Percent | 7.50% | 7.50% | |||
Minimum [Member] | U S Federal [Member] | |||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% | |||
Maximum [Member] | Preferred Enterprise Located In Development Area A [Member] | |||||
Effective Income Tax Rate Reconciliation, Percent | 9.00% | 9.00% | |||
Israeli Taxation [Member] | |||||
Deferred Tax Assets, Net | $ 6,437 | ||||
Effective Income Tax Rate Reconciliation, Percent | 23.00% | 23.00% | 23.00% | 23.00% | |
Net Income Available for Parent Maximum | ₪ | ₪ 10 | ||||
Israeli Taxation [Member] | Israeli Subsidiaries [Member] | |||||
Operating Loss Carryforwards | $ 81,500 | ||||
State and Local Jurisdiction [Member] | |||||
Operating Loss Carryforwards | $ 45,000 |
FINANCIAL INCOME (EXPENSES), _3
FINANCIAL INCOME (EXPENSES), NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Financial expenses: | |||
Interest | $ (657) | $ (198) | $ (266) |
Amortization of marketable securities premiums and accretion of discounts, net | (172) | (80) | (353) |
Exchange rate differences | (1,975) | (2,171) | (318) |
Other | (171) | (322) | (265) |
Financial expenses, Total | (2,975) | (2,771) | (1,202) |
Financial income: | |||
Gain related to non-hedging derivative instruments | 17 | 0 | 305 |
Interest and other | 1,255 | 1,010 | 1,125 |
Financial income, Total | 1,272 | 1,010 | 1,430 |
Financial Income, Net | $ (1,703) | $ (1,761) | $ 228 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator: | |||
Net income | $ 27,248 | $ 3,977 | $ 13,493 |
Denominator: | |||
Denominator for basic earnings per share - weighted average number of ordinary shares, net of treasury stock | 31,440,093 | 29,251,888 | 28,928,060 |
Effect of dilutive securities: | |||
Employee stock options, warrants and RSUs | 1,475,590 | 1,548,016 | 1,291,746 |
Denominator for diluted earnings per share - adjusted weighted average number of shares | 32,915,683 | 30,799,904 | 30,219,806 |
GEOGRAPHIC INFORMATION - Total
GEOGRAPHIC INFORMATION - Total revenues and Long-lived assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | $ 220,774 | $ 200,287 | $ 176,223 |
Long-lived assets | 30,592 | 34,981 | 5,118 |
Americas, principally the U.S. [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | 103,190 | 97,453 | 86,636 |
Long-lived assets | 4,310 | 4,740 | 219 |
Europe [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | 75,490 | 72,956 | 59,193 |
Long-lived assets | 403 | 424 | 109 |
Far East [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | 36,083 | 27,233 | 25,887 |
Long-lived assets | 768 | 480 | 70 |
Israel [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | 6,011 | 2,645 | 4,507 |
Long-lived assets | $ 25,111 | $ 29,337 | $ 4,720 |
GEOGRAPHIC INFORMATION - Tota_2
GEOGRAPHIC INFORMATION - Total revenues from external customers (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
GEOGRAPHIC INFORMATION | |||
Revenue from External Customers | $ 220,774 | $ 200,287 | $ 176,223 |
GEOGRAPHIC INFORMATION (Details
GEOGRAPHIC INFORMATION (Details) | 12 Months Ended |
Dec. 31, 2020segment | |
Revenues from External Customers and Long-Lived Assets and Sales in the United States [Line Items] | |
Reportable segment | 1 |
Sales Revenue, Net [Member] | |
Revenues from External Customers and Long-Lived Assets and Sales in the United States [Line Items] | |
Concentration Risk, Percentage | 40.00% |
DERIVATIVE INSTRUMENTS (Details
DERIVATIVE INSTRUMENTS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Other Comprehensive Income (Loss) [Member] | ||
Description of Location of Foreign Currency Cash Flow Hedge Derivatives on Balance Sheet | "Other comprehensive income (loss)" | "Other comprehensive income (loss)" |
Gains recognized in other comprehensive income (effective portion) | $ 1,319 | $ 244 |
Other receivables and prepaid expenses | ||
Description of Location of Foreign Currency Cash Flow Hedge Derivatives on Balance Sheet | "Other receivables and prepaid expenses" | "Other receivables and prepaid expenses" |
Fair value of foreign exchange forward and options collar (cylinder) contracts | $ 1,489 |
DERIVATIVE INSTRUMENTS - Cash f
DERIVATIVE INSTRUMENTS - Cash flow hedging relationship on Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Comprehensive income (loss) from derivatives before reclassifications | $ 3,445 | $ 535 | $ (489) |
Income (loss) reclassified from accumulated other comprehensive income (loss) (effective portion) | $ 2,126 | $ 291 | $ (245) |
Operating Expense [Member] | |||
Description Of Location Of Foreign Currency Cash Flow Hedge Derivatives On Statement Of Operations | "Operating expenses (income)" | "Operating expenses (income)" | |
Income (loss) reclassified from accumulated other comprehensive income (loss) (effective portion) | $ (2,126) | $ (291) | |
Other Comprehensive Income (Loss) [Member] | |||
Description Of Location Of Foreign Currency Cash Flow Hedge Derivatives On Statement Of Operations | "Other comprehensive income (loss)" | "Other comprehensive income (loss)" | |
Comprehensive income (loss) from derivatives before reclassifications | $ 3,445 | $ 535 |
DERIVATIVE INSTRUMENTS - Additi
DERIVATIVE INSTRUMENTS - Additional information (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
DERIVATIVE INSTRUMENTS | ||
Net Deferred Gain Loss Associated With Cash Flow Hedges Recorded In Other Comprehensive Income | $ 1,319 | $ 244 |
Derivatives Contracts Outstanding | 10,500 | $ 0 |
Derivative, Forward Contracts Outstanding | $ 3,500 |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) - $ / shares | Feb. 04, 2021 | Aug. 05, 2020 | Feb. 04, 2020 |
Subsequent Event [Line Items] | |||
Dividends Payable, Date to be Paid | Sep. 1, 2020 | Mar. 4, 2020 | |
Dividends Payable, Date of Record | Aug. 17, 2020 | Feb. 18, 2020 | |
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Dividends Payable, Date Declared | Feb. 4, 2021 | ||
Dividends Payable, Date to be Paid | Mar. 4, 2021 | ||
Dividends Payable, Date of Record | Feb. 18, 2021 | ||
Dividends Payable, Amount Per Share | $ 0.16 |