Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2023 | Oct. 27, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 000-32259 | |
Entity Registrant Name | ALIGN TECHNOLOGY, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 94-3267295 | |
Entity Address, Address Line One | 410 North Scottsdale Road, Suite 1300 | |
Entity Address, City or Town | Tempe | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85288 | |
City Area Code | 602 | |
Local Phone Number | 742-2000 | |
Title of 12(b) Security | Common Stock, $0.0001 par value | |
Trading Symbol | ALGN | |
Security Exchange Name | NASDAQ | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Shell Company | false | |
Entity Central Index Key | 0001097149 | |
Current Fiscal Year End Date | --12-31 | |
Document Period End Date | Sep. 30, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 76,589,114 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||||
Net revenues | $ 960,214 | $ 890,348 | $ 2,905,534 | $ 2,833,120 |
Cost of net revenues | 297,138 | 271,179 | 868,195 | 817,046 |
Gross profit | 663,076 | 619,169 | 2,037,339 | 2,016,074 |
Operating expenses: | ||||
Selling, general and administrative | 407,992 | 398,547 | 1,300,876 | 1,264,402 |
Research and development | 88,738 | 76,966 | 264,670 | 221,738 |
Total operating expenses | 496,730 | 475,513 | 1,565,546 | 1,486,140 |
Income from operations | 166,346 | 143,656 | 471,793 | 529,934 |
Interest income | 5,522 | 1,685 | 12,280 | 2,607 |
Other income (expense), net | (9,757) | (22,700) | (15,749) | (48,805) |
Total interest income and other income (expense), net | (4,235) | (21,015) | (3,469) | (46,198) |
Net income before provision for income taxes | 162,111 | 122,641 | 468,324 | 483,736 |
Provision for income taxes | 40,684 | 49,941 | 147,285 | 163,938 |
Net income | $ 121,427 | $ 72,700 | $ 321,039 | $ 319,798 |
Net income per share: | ||||
Basic (in usd per share) | $ 1.59 | $ 0.93 | $ 4.19 | $ 4.08 |
Diluted (in usd per share) | $ 1.58 | $ 0.93 | $ 4.18 | $ 4.07 |
Shares used in computing net income per share: | ||||
Basic (in shares) | 76,569 | 78,093 | 76,670 | 78,408 |
Diluted (in shares) | 76,826 | 78,237 | 76,849 | 78,652 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 121,427 | $ 72,700 | $ 321,039 | $ 319,798 |
Other comprehensive income (loss): | ||||
Change in foreign currency translation adjustment, net of tax | (9,822) | (20,246) | 9,810 | (41,313) |
Change in unrealized gains (losses) on investments, net of tax | 526 | (729) | 2,521 | (3,758) |
Other comprehensive income (loss) | (9,296) | (20,975) | 12,331 | (45,071) |
Comprehensive income | $ 112,131 | $ 51,725 | $ 333,370 | $ 274,727 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 1,239,013 | $ 942,050 |
Marketable securities, short-term | 44,792 | 57,534 |
Accounts receivable, net of allowance for doubtful accounts of $13,155 and $10,343, respectively | 904,178 | 859,685 |
Inventories | 296,189 | 338,752 |
Prepaid expenses and other current assets | 217,632 | 226,370 |
Total current assets | 2,701,804 | 2,424,391 |
Marketable securities, long-term | 18,137 | 41,978 |
Property, plant and equipment, net | 1,268,388 | 1,231,855 |
Operating lease right-of-use assets, net | 118,966 | 118,880 |
Goodwill | 404,295 | 407,551 |
Intangible assets, net | 82,741 | 95,720 |
Deferred tax assets | 1,591,791 | 1,571,746 |
Other assets | 132,429 | 55,826 |
Total assets | 6,318,551 | 5,947,947 |
Current liabilities: | ||
Accounts payable | 99,693 | 127,870 |
Accrued liabilities | 614,462 | 454,374 |
Deferred revenues | 1,408,831 | 1,343,643 |
Total current liabilities | 2,122,986 | 1,925,887 |
Income tax payable | 116,443 | 124,393 |
Operating lease liabilities | 98,523 | 100,334 |
Other long-term liabilities | 178,733 | 195,975 |
Total liabilities | 2,516,685 | 2,346,589 |
Commitments and contingencies (Notes 6 and 7) | ||
Stockholders’ equity: | ||
Preferred stock, $0.0001 par value (5,000 shares authorized; none issued) | 0 | 0 |
Common stock, $0.0001 par value (200,000 shares authorized; 76,588 and 77,267 issued and outstanding, respectively) | 8 | 8 |
Additional paid-in capital | 1,193,057 | 1,044,946 |
Accumulated other comprehensive income (loss), net | 2,047 | (10,284) |
Retained earnings | 2,606,754 | 2,566,688 |
Total stockholders’ equity | 3,801,866 | 3,601,358 |
Total liabilities and stockholders’ equity | $ 6,318,551 | $ 5,947,947 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 13,155 | $ 10,343 |
Preferred stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 76,588,000 | 77,267,000 |
Common stock, shares outstanding | 76,588,000 | 77,267,000 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss), Net | Retained Earnings |
Beginning Balance (in shares) at Dec. 31, 2021 | 78,710 | ||||
Beginning Balance at Dec. 31, 2021 | $ 3,622,714 | $ 8 | $ 999,006 | $ 4,326 | $ 2,619,374 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 319,798 | 319,798 | |||
Change in tax effect unrealized gains on investments | (3,758) | ||||
Net change in unrealized gains (losses) from investments | (3,758) | ||||
Net change in foreign currency translation adjustment | (41,313) | (41,313) | |||
Issuance of common stock relating to employee equity compensation plans (in shares) | 302 | ||||
Issuance of common stock relating to employee equity compensation plans | 26,149 | 26,149 | |||
Tax withholdings related to net share settlements of equity awards | (52,611) | (52,611) | |||
Common stock repurchased and retired (in shares) | (901) | ||||
Common stock repurchased and retired | (275,036) | (10,525) | (264,511) | ||
Stock-based compensation | 98,679 | 98,679 | |||
Ending Balance (in shares) at Sep. 30, 2022 | 78,111 | ||||
Ending Balance at Sep. 30, 2022 | 3,694,622 | $ 8 | 1,060,698 | (40,745) | 2,674,661 |
Beginning Balance (in shares) at Jun. 30, 2022 | 78,059 | ||||
Beginning Balance at Jun. 30, 2022 | 3,599,081 | $ 8 | 1,016,882 | (19,770) | 2,601,961 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 72,700 | 72,700 | |||
Net change in unrealized gains (losses) from investments | (729) | (729) | |||
Net change in foreign currency translation adjustment | (20,246) | (20,246) | |||
Issuance of common stock relating to employee equity compensation plans (in shares) | 52 | ||||
Issuance of common stock relating to employee equity compensation plans | 11,322 | 11,322 | |||
Tax withholdings related to net share settlements of equity awards | (424) | (424) | |||
Stock-based compensation | 32,918 | 32,918 | |||
Ending Balance (in shares) at Sep. 30, 2022 | 78,111 | ||||
Ending Balance at Sep. 30, 2022 | 3,694,622 | $ 8 | 1,060,698 | (40,745) | 2,674,661 |
Beginning Balance (in shares) at Dec. 31, 2022 | 77,267 | ||||
Beginning Balance at Dec. 31, 2022 | 3,601,358 | $ 8 | 1,044,946 | (10,284) | 2,566,688 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 321,039 | 321,039 | |||
Change in tax effect unrealized gains on investments | 2,521 | ||||
Net change in unrealized gains (losses) from investments | 2,521 | ||||
Net change in foreign currency translation adjustment | 9,810 | 9,810 | |||
Issuance of common stock relating to employee equity compensation plans (in shares) | 263 | ||||
Issuance of common stock relating to employee equity compensation plans | 26,595 | 26,595 | |||
Tax withholdings related to net share settlements of equity awards | (22,294) | (22,294) | |||
Common stock repurchased and retired (in shares) | (942) | ||||
Common stock repurchased and retired | (292,360) | (11,387) | (280,973) | ||
Equity forward contract related to accelerated stock repurchase | 40,000 | 40,000 | |||
Stock-based compensation | 115,197 | 115,197 | |||
Ending Balance (in shares) at Sep. 30, 2023 | 76,588 | ||||
Ending Balance at Sep. 30, 2023 | 3,801,866 | $ 8 | 1,193,057 | 2,047 | 2,606,754 |
Beginning Balance (in shares) at Jun. 30, 2023 | 76,532 | ||||
Beginning Balance at Jun. 30, 2023 | 3,638,301 | $ 8 | 1,141,623 | 11,343 | 2,485,327 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 121,427 | 121,427 | |||
Change in tax effect unrealized gains on investments | 526 | 526 | |||
Net change in unrealized gains (losses) from investments | 526 | ||||
Net change in foreign currency translation adjustment | (9,822) | (9,822) | |||
Issuance of common stock relating to employee equity compensation plans (in shares) | 56 | ||||
Issuance of common stock relating to employee equity compensation plans | 12,339 | 12,339 | |||
Tax withholdings related to net share settlements of equity awards | (507) | (507) | |||
Stock-based compensation | 39,602 | 39,602 | |||
Ending Balance (in shares) at Sep. 30, 2023 | 76,588 | ||||
Ending Balance at Sep. 30, 2023 | $ 3,801,866 | $ 8 | $ 1,193,057 | $ 2,047 | $ 2,606,754 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 321,039 | $ 319,798 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Deferred taxes | (22,749) | 6,765 |
Depreciation and amortization | 108,669 | 92,096 |
Stock-based compensation | 115,197 | 98,679 |
Non-cash operating lease cost | 24,034 | 22,756 |
Impairment of equity investment | 3,329 | 0 |
Other non-cash operating activities | 28,435 | 26,216 |
Changes in assets and liabilities, net of effects of acquisitions: | ||
Accounts receivable | (80,297) | 32,284 |
Inventories | 31,639 | (108,524) |
Prepaid expenses and other assets | 1,773 | (32,440) |
Accounts payable | (23,130) | (27,100) |
Accrued and other long-term liabilities | 156,024 | (213,378) |
Long-term income tax payable | (7,979) | 9,019 |
Deferred revenues | 82,894 | 197,854 |
Net cash provided by operating activities | 738,878 | 424,025 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Acquisitions, net of cash acquired | 0 | (12,304) |
Purchase of property, plant and equipment | (144,302) | (238,696) |
Purchase of marketable securities | (2,373) | (20,466) |
Proceeds from maturities of marketable securities | 35,754 | 22,456 |
Proceeds from sales of marketable securities | 5,173 | 93,647 |
Purchase of equity investments | (76,999) | 0 |
Other investing activities | 128 | (2,143) |
Net cash used in investing activities | (182,619) | (157,506) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of common stock | 26,595 | 26,149 |
Common stock repurchases | (292,360) | (275,036) |
Payments for equity forward contracts related to accelerated share repurchase agreements | 40,000 | 0 |
Payroll taxes paid upon the vesting of equity awards | (22,294) | (52,611) |
Net cash used in financing activities | (248,059) | (301,498) |
Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash | (11,205) | (20,422) |
Net increase (decrease) in cash, cash equivalents, and restricted cash | 296,995 | (55,401) |
Cash, cash equivalents, and restricted cash at beginning of the period | 942,355 | 1,100,139 |
Cash, cash equivalents, and restricted cash at end of the period | $ 1,239,350 | $ 1,044,738 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Notes To Financial Statements [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared by Align Technology, Inc. (“we”, “our”, "Company", or “Align”) on a consistent basis with the audited Consolidated Financial Statements for the year ended December 31, 2022, and contain all adjustments, including normal recurring adjustments, necessary to fairly state the information set forth herein. The unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”), and, therefore, omit certain information and footnote disclosures necessary to present the unaudited Condensed Consolidated Financial Statements in accordance with accounting principles generally accepted in the United States of America (“U.S.”). The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Consolidated Financial Statements and notes thereto included in Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2022. The results of operations for the three and nine months ended September 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023 or any other future period, and we make no representations related thereto. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles (“GAAP”) in the U.S. requires our management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, useful lives of intangible assets and property and equipment, long-lived assets and goodwill, income taxes, contingent liabilities, the fair values of financial instruments, stock-based compensation and the valuation of investments in privately held companies, among others. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. During the third quarter of 2023, we completed an assessment of the useful lives of certain manufacturing equipment used in cutting, forming, assembling and scanning. We adjusted the estimated useful life from ten (10) years to thirteen (13) years. This change in accounting estimate was effective and applied to assets in service beginning in the third quarter of 2023. The updated useful life will be applied prospectively on the assets scheduled to be placed in service in the future. The effect of this change in estimate was a reduction in depreciation expense of approximately $4.0 million and an increase in net income of $3.0 million, or $0.04 per share basic and diluted, for both the three and nine months ended September 30, 2023. Certain Risks and Uncertainties Our business has been materially impacted by fluctuations in macroeconomic conditions, which have been exacerbated by ongoing geopolitical issues. While the situation is highly uncertain and evolving, we have been and continue to be impacted by factors such as inflation, supply chain challenges, rising interest rates, volatilities in the financial markets, foreign currency exchange rate fluctuations, impacts on consumer confidence and purchasing power, and global recession concerns which could further subject our business to materially adverse consequences should any portion of its impacts become prolonged or escalate beyond its current scope. Additionally, we could also be materially adversely affected by uncertain or reduced demand, labor shortages, delays in collection of outstanding receivables and the impact of any initiatives or programs that we may undertake to address financial and operational challenges faced by our customers. While the overall impact of the COVID-19 pandemic is gradually declining, we continue to be exposed to risks and uncertainties posed by it which varies by geographic region at different levels. The extent to which our business could be impacted in the future by the pandemic is highly uncertain and difficult to predict. Military Conflict in Middle East The recent conflict in the Middle East may further exacerbate general and regional macroeconomic instability, particularly if fighting is prolonged or spreads to other locations. Our iTero business is headquartered in Petach Tikva, Israel. We continue to monitor the potential for violence and military actions that may directly or indirectly impact our personnel, manufacturing, supply chain, and sales in unpredictable ways. Recent Accounting Pronouncements (i) Recent Accounting Pronouncements Not Yet Effective We continue to monitor new accounting pronouncements issued by the Financial Accounting Standards Board ( “ FASB ” ) and do not believe any of the recently issued accounting pronouncements will have a material impact on our consolidated financial statements or related disclosures. |
Financial Instruments
Financial Instruments | 9 Months Ended |
Sep. 30, 2023 | |
Investments, All Other Investments [Abstract] | |
Financial Instruments | Financial Instruments Cash, Cash Equivalents and Marketable Securities The following tables summarize our cash and cash equivalents, and marketable securities on our Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022 (in thousands): Reported as: September 30, 2023 Amortized Gross Gross Fair Value Cash and Cash Equivalents Marketable securities, short-term Marketable securities, long-term Cash $ 988,029 $ — $ — $ 988,029 $ 988,029 $ — $ — Money market funds 250,984 — — 250,984 250,984 — — Corporate bonds 44,572 — (1,160) 43,412 — 31,828 11,584 U.S. government treasury bonds 11,394 — (235) 11,159 — 6,503 4,656 Asset-backed securities 2,477 — (7) 2,470 — 1,582 888 Municipal bonds 701 — (10) 691 — 691 — U.S. government agency bonds 5,263 — (66) 5,197 — 4,188 1,009 Total $ 1,303,420 $ — $ (1,478) $ 1,301,942 $ 1,239,013 $ 44,792 $ 18,137 Reported as: December 31, 2022 Amortized Gross Gross Fair Value Cash and Cash Equivalents Marketable securities, short-term Marketable securities, long-term Cash $ 712,921 $ — $ — $ 712,921 $ 712,921 $ — $ — Money market funds 229,129 — — 229,129 229,129 — — Corporate bonds 69,390 — (2,915) 66,475 — 36,510 29,965 U.S. government treasury bonds 20,559 — (549) 20,010 — 15,404 4,606 Asset-backed securities 4,514 1 (37) 4,478 — 2,909 1,569 Municipal bonds 3,447 — (61) 3,386 — 2,711 675 U.S. government agency bonds 5,231 1 (69) 5,163 — — 5,163 Total $ 1,045,191 $ 2 $ (3,631) $ 1,041,562 $ 942,050 $ 57,534 $ 41,978 The following table summarizes the fair value of our available-for-sale marketable securities classified by contractual maturity as of September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 December 31, 2022 Due in 1 year or less $ 42,847 $ 51,037 Due in 1 year through 5 years 20,082 48,475 Total $ 62,929 $ 99,512 The securities that we invest in are generally deemed to be low risk based on their credit ratings from the major rating agencies. The longer the duration of these securities, the more susceptible they are to changes in market interest rates and bond yields. As interest rates increase, those securities purchased at a lower yield show a mark-to-market unrealized loss. Our unrealized losses as of September 30, 2023 and December 31, 2022 are primarily due to changes in interest rates and credit spreads. The following tables summarize the gross unrealized losses as of September 30, 2023 and December 31, 2022, aggregated by investment category and length of time that individual securities have been in a continuous loss position (in thousands): As of September 30, 2023 Less than 12 months 12 Months of Greater Total September 30, 2023 Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Corporate bonds $ 2,509 $ (11) $ 40,608 $ (1,149) $ 43,117 $ (1,160) U.S. government treasury bonds 1,995 (43) 9,163 (192) 11,158 (235) Asset-backed securities 1,975 (4) 495 (3) 2,470 (7) Municipal bonds — — 691 (10) 691 (10) U.S. government agency bonds 4,030 (28) 1,166 (38) 5,196 (66) Total $ 10,509 $ (86) $ 52,123 $ (1,392) $ 62,632 $ (1,478) As of December 31, 2022 Less than 12 months 12 Months of Greater Total December 31, 2022 Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Corporate bonds $ 10,639 $ (440) $ 54,634 $ (2,475) $ 65,273 $ (2,915) U.S. government treasury bonds 5,262 (177) 14,748 (372) 20,010 (549) Asset-backed securities 2,636 (17) 1,275 (20) 3,911 (37) Municipal bonds — — 2,412 (61) 2,412 (61) U.S. government agency bonds 3,017 (5) 1,136 (64) 4,153 (69) Total $ 21,554 $ (639) $ 74,205 $ (2,992) $ 95,759 $ (3,631) Accounts Receivable Factoring We enter into factoring transactions on a non-recourse basis with financial institutions to sell certain of our non-U.S. accounts receivable. We account for these transactions as sales of accounts receivables and include the cash proceeds as a part of our cash flows from operations in the Condensed Consolidated Statements of Cash Flows. Total accounts receivable sold under the factoring arrangements was $24.2 million during the three months and $40.4 million for the nine months ended September 30, 2023. Factoring fees on the sales of receivables were recorded in other income (expense), net in our Condensed Consolidated Statement of Operations and were not material. Fair Value Measurements Fair value is an exit price, representing the amount that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We use the GAAP fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value: Level 1 — Quoted (unadjusted) prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability. We obtain fair values for our Level 2 investments. Our custody bank and asset managers independently use professional pricing services to gather pricing data which may include quoted market prices for identical or comparable financial instruments, or inputs other than quoted prices that are observable either directly or indirectly, and we are ultimately responsible for these underlying estimates. Level 3 — Unobservable inputs to the valuation methodology that are supported by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies or similar valuation techniques, as well as significant management judgment or estimation. The following tables summarize our financial assets measured at fair value as of September 30, 2023 and December 31, 2022 (in thousands): Description Balance as of Level 1 Level 2 Cash equivalents: Money market funds $ 250,984 $ 250,984 $ — Short-term investments: U.S. government agency bonds 4,188 — 4,188 U.S. government treasury bonds 6,503 6,503 — Corporate bonds 31,828 — 31,828 Municipal bonds 691 — 691 Asset-backed securities 1,582 — 1,582 Long-term investments: U.S. government treasury bonds 4,656 4,656 — Corporate bonds 11,584 — 11,584 U.S. government agency bonds 1,009 — 1,009 Asset-backed securities 888 — 888 $ 313,913 $ 262,143 $ 51,770 Description Balance as of December 31, 2022 Level 1 Level 2 Cash equivalents: Money market funds $ 229,129 $ 229,129 $ — Short-term investments: U.S. government treasury bonds 15,404 15,404 — Corporate bonds 36,510 — 36,510 Municipal bonds 2,711 — 2,711 Asset-backed securities 2,909 — 2,909 Long-term investments: U.S. government treasury bonds 4,606 4,606 — Corporate bonds 29,965 — 29,965 Municipal bonds 675 — 675 U.S. government agency bonds 5,163 — 5,163 Asset-backed securities 1,569 — 1,569 $ 328,641 $ 249,139 $ 79,502 Investments in Privately Held Companies Our investments in privately held companies in which we cannot exercise significant influence and do not own a majority equity interest or otherwise control are accounted for under the measurement alternative. Under the measurement alternative, the carrying value of our equity investment is adjusted to fair value for observable transactions for identical or similar investments of the same issuer. Investments in equity securities are reported on our Consolidated Balance Sheet as other assets, and we periodically evaluate them for impairment. We record any change in carrying value of our equity securities, in other income (expense), net in our Consolidated Statement of Operations. The carrying value of our equity investments in privately held companies without readily determinable fair values were not material, excluding Heartland, as of September 30, 2023 or 2022 and the associated adjustments to the carrying values of the investments were not material during the quarters ended September 30, 2023 and 2022. On April 24, 2023, we entered into a Subscription Agreement (the "Subscription Agreement") with Heartland Dental Holding Corporation (“Heartland”) who is an affiliate of KKR Core Holding Company LLC, which is an investment vehicle managed or advised by, or otherwise affiliated with, Kohlberg Kravis Roberts & Co. L.P. Heartland is a dental support organization (“DSO”) that provides nonclinical administrative and support services to supported dental professional corporations (“PCs”). Pursuant to the Subscription Agreement we acquired less than a 5% equity interest and have no significant influence in Heartland through the purchase of Class A Common Stock for $75 million. In connection with the Subscription Agreement, we entered into a Stockholders’ Agreement, by and among us, Heartland Dental Topco, LLC (“Topco”) and funds and accounts managed by affiliates of KKR & Co. Inc. (“KKR”), and a Side Letter, by and among us, Heartland, Topco and KKR (the "Side Letter"). Subject to certain restrictions set forth in the Side Letter, we agreed to provisions applicable to Heartland’s stockholders, including certain drag-along and voting obligations. Similar to our other private equity investments Heartland is accounted for under the measurement alternative. Based on review of our equity investment, we determined there were no adjustments to the carrying value and it is properly reflected on our Consolidated Balance Sheet in other assets at $75 million as of September 30, 2023. On September 6, 2023, we entered into a definitive agreement to acquire privately held Cubicure GmbH. The purchase price for the transaction will be approximately €79 million subject to customary closing adjustments and adjustments for Align’s existing ownership of capital stock of Cubicure. The acquisition is expected to close in the fourth quarter of 2023 or early 2024. Derivatives Not Designated as Hedging Instruments We enter into foreign currency forward contracts to minimize the short-term impact of foreign currency exchange rate fluctuations on certain trade and intercompany receivables and payables. These forward contracts are classified within Level 2 of the fair value hierarchy. As a result of the settlement of foreign currency forward contracts, during the three months ended September 30, 2023 and 2022, we recognized net gains of $19.8 million and of $34.6 million, respectively, and during the nine months ended September 30, 2023 and 2022, we recognized net gains of $14.4 million and of $43.8 million, respectively. As of September 30, 2023 and December 31, 2022, the fair value of foreign exchange forward contracts outstanding was not material. The following tables present the gross notional value of all our foreign exchange forward contracts outstanding as of September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 Local Currency Amount Notional Contract Amount (USD) Euro €271,600 $ 287,705 Canadian Dollar C$103,200 76,384 Polish Zloty PLN293,200 67,110 British Pound £46,398 56,620 Chinese Yuan ¥399,000 54,764 Swiss Franc CHF27,900 30,615 Japanese Yen ¥4,400,000 29,612 Brazilian Real R$90,000 17,861 Mexican Peso M$230,000 13,214 Israeli Shekel ILS50,300 13,208 New Zealand Dollar NZ$8,700 5,227 Czech Koruna Kč86,800 3,762 Australian Dollar A$3,970 2,567 New Taiwan Dollar NT$77,600 2,405 Korean Won ₩1,400,000 1,036 $ 662,090 December 31, 2022 Local Currency Amount Notional Contract Amount (USD) Euro €186,900 $ 200,010 Polish Zloty PLN365,988 83,307 Canadian Dollar C$109,000 80,514 Chinese Yuan ¥471,000 68,223 British Pound £41,200 49,677 Japanese Yen ¥6,200,000 47,196 Israeli Shekel ILS110,030 31,383 Swiss Franc CHF25,000 27,165 Brazilian Real R$141,200 26,839 Mexican Peso M$230,000 11,746 New Zealand Dollar NZ$6,000 3,806 Australian Dollar A$4,000 2,721 Czech Koruna Kč56,000 2,469 New Taiwan Dollar NT$60,000 1,959 $ 637,015 |
Balance Sheet Components
Balance Sheet Components | 9 Months Ended |
Sep. 30, 2023 | |
Notes To Financial Statements [Abstract] | |
Balance Sheet Components | Balance Sheet Components Inventories consist of the following (in thousands): September 30, December 31, Raw materials $ 139,681 $ 172,758 Work in process 98,633 96,558 Finished goods 57,875 69,436 Total inventories $ 296,189 $ 338,752 Prepaid expenses and other current assets consist of the following (in thousands): September 30, December 31, Value added tax receivables $ 123,980 $ 140,484 Prepaid expenses 59,496 69,124 Other current assets 34,156 16,762 Total prepaid expenses and other current assets $ 217,632 $ 226,370 Accrued liabilities consist of the following (in thousands): September 30, December 31, Accrued payroll and benefits $ 203,712 $ 149,508 Accrued income taxes 157,175 74,323 Accrued expenses 73,087 64,341 Accrued sales and marketing expenses 35,405 36,407 Current operating lease liabilities 28,277 26,574 Accrued property, plant and equipment 14,437 19,922 Other accrued liabilities 102,369 83,299 Total accrued liabilities $ 614,462 $ 454,374 Accrued warranty, which is included in the "Other accrued liabilities" category of the accrued liabilities table above, consists of the following activity (in thousands): Nine Months Ended 2023 2022 Balance at beginning of period $ 17,873 $ 16,169 Charged to cost of net revenues 14,329 11,359 Actual warranty expenditures (10,327) (11,109) Balance at end of period $ 21,875 $ 16,419 Deferred revenues consist of the following (in thousands): September 30, December 31, Deferred revenues - current $ 1,408,831 $ 1,343,643 Deferred revenues - long-term 1 $ 146,271 $ 160,662 1 Included in Other long-term liabilities within our Condensed Consolidated Balance Sheet During the three months ended September 30, 2023 and 2022, we recognized $960.2 million and $890.3 million of net revenues, respectively, of which $178.8 million and $156.5 million was included in the deferred revenues balance at December 31, 2022 and 2021, respectively. During the nine months ended September 30, 2023 and 2022, we recognized $2,905.5 million and $2,833.1 million of net revenues, respectively, of which $583.5 million and $519.8 million was included in the deferred revenues balance at December 31, 2022 and 2021, respectively. Our unfulfilled performance obligations, including deferred revenues and backlog, as of September 30, 2023 were $1,560.7 million. These performance obligations are expected to be fulfilled over the next six months to five years. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2023 | |
Notes To Financial Statements [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill The change in the carrying value of goodwill for the nine months ended September 30, 2023, categorized by reportable segments, is as follows (in thousands): Clear Aligner Systems and Services Total Balance as of December 31, 2022 $ 109,480 $ 298,071 $ 407,551 Foreign currency translation adjustments (479) (2,777) (3,256) Balance as of September 30, 2023 $ 109,001 $ 295,294 $ 404,295 Intangible Long-Lived Assets Acquired intangible long-lived assets were as follows, excluding intangibles that were fully amortized (in thousands): Weighted Average Amortization Period Gross Carrying Amount as of September 30, 2023 Accumulated Amortization Accumulated Impairment Loss Net Carrying Value as of September 30, 2023 Existing technology 10 $ 112,051 $ (42,383) $ (4,328) $ 65,340 Customer relationships 10 21,500 (7,525) — 13,975 Trademarks and tradenames 10 17,200 (7,820) (4,122) 5,258 Patents 8 6,511 (5,884) — 627 $ 157,262 $ (63,612) $ (8,450) 85,200 Foreign currency translation adjustments (2,459) Total intangible assets, net 1 $ 82,741 1 Also includes $33.5 million of fully amortized intangible assets related to customer relationships. Weighted Average Amortization Period Gross Carrying Amount as of December 31, 2022 Accumulated Amortization Accumulated Impairment Loss Net Carrying Value as of December 31, 2022 Existing technology 10 $ 112,051 $ (33,537) $ (4,328) $ 74,186 Customer relationships 10 21,500 (5,913) — 15,587 Trademarks and tradenames 10 17,200 (6,442) (4,122) 6,636 Patents 8 6,511 (5,288) — 1,223 $ 157,262 $ (51,180) $ (8,450) 97,632 Foreign currency translation adjustments (1,912) Total intangible assets, net 1 $ 95,720 1 Also includes $33.5 million of fully amortized intangible assets related to customer relationships. The total estimated annual future amortization expense for these acquired intangible assets as of September 30, 2023 is as follows (in thousands): Fiscal Year Ending December 31, Amortization Remainder of 2023 $ 4,069 2024 15,335 2025 14,959 2026 14,353 2027 11,992 Thereafter 24,492 Total $ 85,200 Amortization expense for the three months ended September 30, 2023 and 2022 was $4.2 million and $3.9 million, respectively, and amortization expense for the nine months ended September 30, 2023 and 2022 was $12.4 million and $12.1 million, respectively. |
Credit Facility
Credit Facility | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Credit Facility | Credit FacilityWe have a credit facility that provides for a $300.0 million unsecured revolving line of credit, along with a $50.0 million letter of credit. On December 23, 2022, we amended certain provisions in our credit facility which included extending the maturity date on the facility to December 23, 2027 and replacing the interest rate from the existing LIBOR with SOFR (“2022 Credit Facility”). The 2022 Credit Facility requires us to comply with specific financial conditions and performance requirements. Loans under the 2022 Credit Facility bear interest, at our option, at either a rate based on the SOFR for the applicable interest period or a base rate, in each case plus a margin. As of September 30, 2023, we had no outstanding borrowings under the 2022 Credit Facility and were in compliance with the conditions and performance requirements in all material respects. |
Legal Proceedings
Legal Proceedings | 9 Months Ended |
Sep. 30, 2023 | |
Legal Proceedings [Abstract] | |
Legal Proceedings | Legal Proceedings 2019 Shareholder Derivative Lawsuit In January 2019, three derivative lawsuits were filed in the U.S. District Court for the Northern District of California which were later consolidated, purportedly on our behalf, naming as defendants the then current members of our Board of Directors along with certain of our executive officers. The complaints assert various state law causes of action, including for breaches of fiduciary duty, insider trading, and unjust enrichment. The complaints seek unspecified monetary damages on our behalf, which is named solely as a nominal defendant against whom no recovery is sought, as well as disgorgement and the costs and expenses associated with the litigation, including attorneys’ fees. The consolidated action is currently stayed. Defendants have not yet responded to the complaints. On April 12, 2019, a derivative lawsuit was also filed in California Superior Court for Santa Clara County, purportedly on our behalf, naming as defendants the members of our Board of Directors along with certain of our executive officers. The allegations in the complaint are similar to those in the derivative suits described above. The matter is currently stayed. Defendants have not yet responded to the complaint. We believe these claims are without merit. We are currently unable to predict the outcome of these lawsuits and therefore cannot determine the likelihood of loss nor estimate a range of possible loss . Antitrust Class Actions On June 5, 2020, a dental practice named Simon and Simon, PC doing business as City Smiles brought an antitrust action in the U.S. District Court for the Northern District of California on behalf of itself and a putative class of similarly situated practices seeking monetary damages and injunctive relief relating to our alleged market activities in alleged clear aligner and intraoral scanner markets. Plaintiff filed an amended complaint and added VIP Dental Spas as a plaintiff on August 14, 2020. A jury trial is scheduled to begin in this matter on May 13, 2024. We believe the plaintiffs’ claims are without merit and we intend to vigorously defend ourselves. On May 3, 2021, an individual named Misty Snow brought an antitrust action in the U.S. District Court for the Northern District of California on behalf of herself and a putative class of similarly situated individuals seeking monetary damages and injunctive relief relating to our alleged market activities in alleged clear aligner and intraoral scanner markets based on Section 2 of the Sherman Act. Plaintiff filed an amended complaint on July 30, 2021 adding new plaintiffs and various state law claims. Plaintiffs filed a second amended complaint on October 21, 2021. On March 2, 2022, Plaintiffs filed a third amended complaint. On October 3, 2022, Plaintiffs filed a fourth amended complaint. On May 18, 2023, the court granted plaintiffs leave to file a fifth amended complaint. The amended complaints added allegations based on Section 1 of the Sherman Act. A jury trial is scheduled to begin in this matter on May 13, 2024 for issues related to Section 2 allegations. A jury trial is scheduled to begin in this matter on January 21, 2025 for issues related to Section 1 allegations. We believe the plaintiffs’ claims are without merit and we intend to vigorously defend ourselves. We are currently unable to predict the outcome of these lawsuits and therefore we cannot determine the likelihood of loss, if any, nor estimate a range of possible loss. SDC Dispute On August 27, 2020, we initiated a confidential arbitration proceeding against SmileDirectClub LLC (“SDC”) before the American Arbitration Association in San Jose, California. This arbitration relates to the Strategic Supply Agreement (“Supply Agreement”) entered into between the parties in 2016. The complaint alleges that SDC breached the Supply Agreement ’ s terms, causing damages to us in an amount to be determined. On January 19, 2021, SDC filed a counterclaim alleging that we breached the Supply Agreement. On May 3, 2022, SDC filed an additional counterclaim alleging that we breached the Supply Agreement. We deny SDC's allegations in the counterclaims. On October 27, 2022, the arbitrator issued an interim award on our claims and SDC’s first counterclaim finding that SDC breached the Supply Agreement, we did not breach the Supply Agreement, and SDC caused harm to us. Based on these findings, the arbitrator awarded us an interim award of $63 million in damages. On May 18, 2023, the arbitrator issued a final award on SDC ’ s second counterclaim, finding that Align did not breach the Supply Agreement. The final award subsumed the interim award on our claims and SDC ’ s first counterclaim and concluded the Supply Agreement arbitration proceedings. On March 6, 2023, Align filed a petition to confirm the arbitrator ’ s interim award in the Superior Court for Santa Clara County. On May 30, 2023, Align filed a petition to confirm the final award in the Superior Court of Santa Clara County. On August 21, 2023, the Superior Court issued an order confirming the Interim and Final Awards. On September 8, 2023, the Superior Court entered judgment in Align ’s favor for $63 million in damages . On September 29, 2023, SDC and certain affiliates filed bankruptcy petitions under chapter 11 of title 11 of the United States Code in the United States Bankruptcy Court for the Southern District of Texas. The extent to which Align will be able to collect any or all of its $63 million judgment through SDC ’s bankruptcy proceedings is unknown. In addition to the above, in the ordinary course of our operations, we are involved in a variety of claims, suits, investigations, and proceedings, including actions with respect to intellectual property claims, patent infringement claims, government investigations, labor and employment claims, breach of contract claims, tax, and other matters. Regardless of the outcome, these proceedings can have an adverse impact on us because of defense costs, diversion of management resources, and other factors. Although the results of complex legal proceedings are difficult to predict and our view of these matters may change in the future as litigation and events related thereto unfold; we currently do not believe that these matters, individually or in the aggregate, will materially affect our financial position, results of operations or cash flows. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Tax Matter During the three months ended September 30, 2023, the Company received a notice and initial assessment, in the amount of approximately $27 million, from His Majesty’s Revenue and Customs (“HMRC”) for unpaid value added tax (“VAT”) related to certain clear aligner sales made during the period of June 2022 through May 2023. We are required to pay this initial assessment prior to contesting or litigating the assessment in administrative and judicial proceedings. The Company has historically asserted and continues to assert that doctor prescribed clear aligners sold by dentists for the orthodontic treatment of patient malocclusions are exempt from VAT, that the Company has reasonably relied upon statements and guidance by HMRC and that the Company’s interpretation of United Kingdom legislation is appropriate. However, it is not possible at this stage to accurately evaluate the likelihood of an unfavorable outcome of any legal challenges brought by the Company against HMRC disputing this initial assessment and any assessments for other past periods, if any. Accordingly, the Company has determined that a potential loss related to unpaid VAT is not probable. As such, we have not recorded a contingent loss for the initial assessment in our Condensed Consolidated Statements of Operations for the three or nine months ended September 30, 2023. The Company acknowledges that this matter poses risks of litigation and the ultimate resolution of this matter could result in an unfavorable ruling, which consequently could lead to a significant loss to the Company. As of September 30, 2023, if an unfavorable ruling is issued, we estimate a potential exposure up to approximately $100 million, excluding interest and penalties. Off-Balance Sheet Arrangements As of September 30, 2023, we had no material off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on our consolidated financial condition, results of operations, liquidity, capital expenditures or capital resources other than certain items disclosed in Note 8 “Commitments and Contingencies” of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. Indemnification Provisions In the normal course of business to facilitate transactions in our services and products, we indemnify certain parties: customers, vendors, lessors, and other parties with respect to certain matters, including, but not limited to, services to be provided by us and intellectual property infringement claims made by third parties. In addition, we have entered into indemnification agreements with our directors and our executive officers that will require us, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. Several of these agreements limit the time within which an indemnification claim can be made and the amount of the claim. It is not possible to make a reasonable estimate of the maximum potential amount under these indemnification agreements due to the unique facts and circumstances involved in each particular agreement. Additionally, we have a limited history of prior indemnification claims and the payments we have made under such agreements have not had a material adverse effect on our results of operations, cash flows or financial position. However, to the extent that valid indemnification claims arise in the future, future payments by us could be significant and could have a material adverse effect on our results of operations or cash flows in a particular period. As of September 30, 2023, we did not have any material indemnification claims that were probable or reasonably possible. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity As of September 30, 2023, the 2005 Incentive Plan, as amended, has a total reserve of 32,168,895 shares of which 4,754,771 shares are available for issuance. Summary of Stock-Based Compensation Expense The stock-based compensation related to our stock-based awards and employee stock purchase plan for the three and nine months ended September 30, 2023 and 2022 is as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Cost of net revenues $ 1,974 $ 1,651 $ 5,682 $ 4,779 Selling, general and administrative 29,739 25,293 87,432 76,509 Research and development 7,889 5,974 22,083 17,391 Total stock-based compensation $ 39,602 $ 32,918 $ 115,197 $ 98,679 Restricted Stock Units (“RSUs”) The fair value of RSUs is based on our closing stock price on the date of grant. RSUs granted generally vest over a period of four years. A summary for the nine months ended September 30, 2023 is as follows: Number of Shares Underlying RSUs (in thousands) Weighted Average Grant Date Fair Value Weighted Average Remaining Aggregate Unvested as of December 31, 2022 489 $ 427.24 Granted 508 316.52 Vested and released (196) 378.93 Forfeited (37) 388.56 Unvested as of September 30, 2023 764 $ 367.93 1.6 $ 233,165 As of September 30, 2023, we expect to recognize $202.1 million of total unamortized compensation costs, net of estimated forfeitures, related to RSUs over a weighted average period of 2.8 years. Market-Performance Based Restricted Stock Units (“MSUs”) We grant MSUs to members of senior management. Each MSU represents the right to one share of our common stock. The actual number of MSUs which will be eligible to vest will be based on the performance of Align’s stock price relative to the performance of a stock market index over the vesting period. MSUs vest over a period of three years and the maximum number eligible to vest in the future is 250% of the MSUs initially granted. The following table summarizes the MSU performance activity for the nine months ended September 30, 2023: Number of Shares Underlying MSUs (in thousands) Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term (in years) Aggregate Unvested as of December 31, 2022 144 $ 725.73 Granted 82 629.53 Vested and released 1 (25) 392.67 Forfeited (43) 423.87 Unvested as of September 30, 2023 158 $ 811.06 1.7 $ 48,135 1 Includes MSUs vested during the period below 100% of the original grant as actual shares released is based on Align ’ s stock performance over the vesting period. As of September 30, 2023, we expect to recognize $56.8 million of total unamortized compensation costs, net of estimated forfeitures, related to MSUs over a weighted average period of 1.7 years. Restricted Stock Units with Performance Conditions (“PSUs”) During the nine months ended September 30, 2023, we did not grant any PSUs to any employees. As of September 30, 2023, we expect to recognize $0.5 million of total unamortized compensation costs, net of estimated forfeitures, related to PSUs over a weighted average term of 1.3 years. Total PSUs granted were 4,728 and the weighted average grant date fair value for the PSUs was $201.63. Employee Stock Purchase Plan As of September 30, 2023, we have 1,995,520 shares available for future issuance under our Amended and Restated 2010 Employee Stock Purchase Plan (the “2010 Purchase Plan”). The fair value of the option component of the 2010 Purchase Plan shares was estimated at the grant date using the Black-Scholes option pricing model with the following weighted average assumptions: Nine Months Ended 2023 2022 Expected term (in years) 1.2 1.5 Expected volatility 56.2 % 50.2 % Risk-free interest rate 4.9 % 1.8 % Expected dividends — — Weighted average fair value at grant date $ 133.53 $ 159.44 As of September 30, 2023, we expect to recognize $11.6 million of total unamortized compensation costs related to future employee stock purchases over a weighted average period of 0.7 years. |
Common Stock Repurchase Program
Common Stock Repurchase Programs | 9 Months Ended |
Sep. 30, 2023 | |
Disclosure Common Stock Repurchase Program Additional Information [Abstract] | |
Common Stock Repurchase Programs | Common Stock Repurchase Programs In May 2021, our Board of Directors authorized a plan to repurchase up to $1.0 billion of our common stock (“May 2021 Repurchase Program”), which was completed in March 2023. In January 2023, our Board of Directors authorized a new plan to repurchase up to $1.0 billion of our common stock (“January 2023 Repurchase Program”), none of which had been utilized as of September 30, 2023. The January 2023 Repurchase Program does not have an expiration date. Accelerated Share Repurchase Agreements (“ASRs”) During the three months ended March 31, 2023, we entered into or completed ASRs providing for the repurchase of our common stock based on the volume-weighted average price during the term of the agreement, less an agreed upon discount. We did not enter into any ASRs during the three months ended September 30, 2023. The following table summarizes the information regarding repurchases of our common stock under the ASRs: Agreement Repurchase Amount Paid Completion Total Shares Average Price per Share Q4 2022 May 2021 N/A 1 Q1 2023 136,448 $ 293.15 Q1 2023 May 2021 $ 250.0 Q1 2023 805,905 $ 310.21 1 During the fourth quarter of 2022, we entered into a $200.0 million ASR which was not completed as of December 31, 2022 . During the first quarter of 2023, we paid a final $40.0 million related to the $200.0 million ASR, closing this ASR with the final delivery of shares. As of September 30, 2023, $1.0 billion remains available for repurchases under the January 2023 Stock Repurchase Program. Subsequent to the third quarter, on October 26, 2023, we entered into an ASR to repurchase $250.0 million of our common stock. We made an initial payment of $250.0 million and received an initial delivery of approximately one million shares. The exact number of shares to be repurchased will be based on our volume-weighted average stock price under the terms of the ASR, less an agreed upon discount. |
Accounting for Income Taxes
Accounting for Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Notes To Financial Statements [Abstract] | |
Accounting for Income Taxes | Accounting for Income Taxes Our provision for income taxes was $40.7 million and $49.9 million for the three months ended September 30, 2023 and 2022, respectively, representing effective tax rates of 25.1% and 40.7%, respectively. Our provision for income taxes was $147.3 million and $163.9 million for the nine months ended September 30, 2023 and 2022, respectively, representing effective tax rates of 31.4% and 33.9%, respectively. Our effective tax rate differs from the statutory federal income tax rate of 21% for both the three and nine months ended September 30, 2023 and 2022 primarily due to the recognition of additional tax expense resulting from U.S. taxes on foreign earnings, foreign income taxed at different rates, application of newly issued tax guidance, state income taxes, and non-deductible expenses in the U.S. We exercise significant judgment in regards to estimates of future market growth, forecasted earnings and projected taxable income in determining the provision for income taxes and for purposes of assessing our ability to utilize any future benefit from deferred tax assets. We continue to assess the realizability of the deferred tax assets as we take into account new information. Our total gross unrecognized tax benefits, excluding interest and penalties, were $150.0 million and $141.6 million as of September 30, 2023 and December 31, 2022, respectively, a material amount of which would impact our effective tax rate if recognized. The increase in our unrecognized tax benefits relates primarily to positions taken on income tax return calculations finalized during the three and nine months ended September 30, 2023 . |
Net Income Per Share
Net Income Per Share | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | Net Income per Share The following table sets forth the computation of basic and diluted net income per share attributable to common stock (in thousands, except per share amounts): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Numerator: Net income $ 121,427 $ 72,700 $ 321,039 $ 319,798 Denominator: Weighted average common shares outstanding, basic 76,569 78,093 76,670 78,408 Dilutive effect of potential common stock 257 144 179 244 Total shares, diluted 76,826 78,237 76,849 78,652 Net income per share, basic $ 1.59 $ 0.93 $ 4.19 $ 4.08 Net income per share, diluted $ 1.58 $ 0.93 $ 4.18 $ 4.07 Anti-dilutive potential common shares 1 245 345 263 317 1 Represents RSU and MSU shares excluded from the calculation of diluted net income per share as the effect would have been anti-dilutive. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 9 Months Ended |
Sep. 30, 2023 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Cash Flow Information | Supplemental Cash Flow Information The supplemental cash flow information consists of the following (in thousands): Nine Months Ended 2023 2022 Non-cash investing and financing activities: Acquisition of property, plant and equipment in accounts payable and accrued liabilities $ 25,979 $ 41,255 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 25,559 $ 23,310 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 25,048 $ 26,532 |
Segments and Geographical Infor
Segments and Geographical Information | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Segments and Geographical Information | Segments and Geographical Information Segment Information We report segment information based on the management approach. The management approach designates the internal reporting used by our Chief Operating Decision Maker for decision making and performance assessment as the basis for determining our reportable segments. The performance measures of our reportable segments include net revenues, gross profit and income from operations. Income from operations for each segment includes all geographic revenues, related cost of net revenues and operating expenses directly attributable to the segment. Certain operating expenses are attributable to operating segments and each allocation is measured differently based on the specific facts and circumstances of the costs being allocated. Costs not specifically allocated to segment income from operations include various corporate expenses such as stock-based compensation and costs related to IT, facilities, human resources, accounting and finance, legal and regulatory, and other separately managed general and administrative costs outside the operating segments and restructuring costs. We group our operations into two reportable segments (i) Clear Aligner segment and (ii) Imaging Systems and CAD/CAM services (“Systems and Services”) segment. Summarized financial information by segment is as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Net revenues Clear Aligner $ 794,939 $ 732,837 $ 2,417,417 $ 2,340,931 Systems and Services 165,275 157,511 488,117 492,189 Total net revenues $ 960,214 $ 890,348 $ 2,905,534 $ 2,833,120 Gross profit Clear Aligner $ 562,331 $ 519,387 $ 1,731,721 $ 1,710,328 Systems and Services 100,745 99,782 305,618 305,746 Total gross profit $ 663,076 $ 619,169 $ 2,037,339 $ 2,016,074 Income from operations Clear Aligner $ 296,319 $ 259,434 $ 879,933 $ 879,362 Systems and Services 44,975 44,436 132,600 140,834 Unallocated corporate expenses (174,948) (160,214) (540,740) (490,262) Total income from operations $ 166,346 $ 143,656 $ 471,793 $ 529,934 Stock-based compensation Clear Aligner $ 5,772 $ 4,377 $ 14,917 $ 10,232 Systems and Services 366 240 950 690 Unallocated corporate expenses 33,464 28,301 99,330 87,757 Total stock-based compensation $ 39,602 $ 32,918 $ 115,197 $ 98,679 Depreciation and amortization Clear Aligner $ 17,737 $ 14,678 $ 50,725 $ 42,474 Systems and Services 7,827 7,181 23,716 20,879 Unallocated corporate expenses 11,466 10,330 34,228 28,743 Total depreciation and amortization $ 37,030 $ 32,189 $ 108,669 $ 92,096 The following table reconciles total segment income from operations in the table above to net income before provision for income taxes (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Total segment income from operations $ 341,294 $ 303,870 $ 1,012,533 $ 1,020,196 Unallocated corporate expenses (174,948) (160,214) (540,740) (490,262) Total income from operations 166,346 143,656 471,793 529,934 Interest income 5,522 1,685 12,280 2,607 Other income (expense), net (9,757) (22,700) (15,749) (48,805) Net income before provision for income taxes $ 162,111 $ 122,641 $ 468,324 $ 483,736 Geographical Information Net revenues are presented below by geographic area (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Net revenues 1 : U.S. $ 421,272 $ 400,045 $ 1,262,008 $ 1,251,018 Switzerland 259,587 257,845 913,724 919,935 Other International 279,355 232,458 729,802 662,167 Total net revenues $ 960,214 $ 890,348 $ 2,905,534 $ 2,833,120 1 Net revenues are attributed to countries based on the location of where revenues are recognized by our legal entities. Tangible long-lived assets, which includes Property, plant and equipment, net, and Operating lease right-of-use assets, net, are presented below by geographic area (in thousands): September 30, December 31, 2022 Long-lived assets 1 : Switzerland $ 567,230 $ 532,921 U.S. 206,348 214,804 Other International 2 613,776 603,010 Total long-lived assets $ 1,387,354 $ 1,350,735 1 Long-lived assets are attributed to countries based on the location of our entity that owns or leases the assets. 2 Certain prior period immaterial amounts have been reclassified to conform to current presentation. |
Restructuring and Other Charges
Restructuring and Other Charges | 9 Months Ended |
Sep. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Other Charges | Restructuring and Other Charges During the fourth quarter of 2022, we initiated a restructuring plan to increase efficiencies across the organization which was completed during the first half of 2023. During fiscal 2022, we incurred approximately $10.2 million in restructuring expenses, of which $3.9 million remained unpaid and was included in Accrued liabilities as of December 31, 2022. During the first quarter of 2023, we paid $3.7 million, and recorded incremental restructuring expenses of approximately $0.1 million. The remaining $0.3 million balance as of March 31, 2023 was paid during the three months ended June 30, 2023. During the three months ended September 30, 2023 there was no additional restructuring activity. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||
Net income | $ 121,427 | $ 72,700 | $ 321,039 | $ 319,798 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Sep. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Notes To Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared by Align Technology, Inc. (“we”, “our”, "Company", or “Align”) on a consistent basis with the audited Consolidated Financial Statements for the year ended December 31, 2022, and contain all adjustments, including normal recurring adjustments, necessary to fairly state the information set forth herein. The unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”), and, therefore, omit certain information and footnote disclosures necessary to present the unaudited Condensed Consolidated Financial Statements in accordance with accounting principles generally accepted in the United States of America (“U.S.”). |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles (“GAAP”) in the U.S. requires our management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, useful lives of intangible assets and property and equipment, long-lived assets and goodwill, income taxes, contingent liabilities, the fair values of financial instruments, stock-based compensation and the valuation of investments in privately held companies, among others. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. During the third quarter of 2023, we completed an assessment of the useful lives of certain manufacturing equipment used in cutting, forming, assembling and scanning. We adjusted the estimated useful life from ten (10) years to thirteen (13) years. This change in accounting estimate was effective and applied to assets in service beginning in the third quarter of 2023. The updated useful life will be applied prospectively on the assets scheduled to be placed in service in the future. The effect of this change in estimate was a reduction in depreciation expense of approximately $4.0 million and an increase in net income of $3.0 million, or $0.04 per share basic and diluted, for both the three and nine months ended September 30, 2023. |
Certain Risk and Uncertainties | Certain Risks and Uncertainties Our business has been materially impacted by fluctuations in macroeconomic conditions, which have been exacerbated by ongoing geopolitical issues. While the situation is highly uncertain and evolving, we have been and continue to be impacted by factors such as inflation, supply chain challenges, rising interest rates, volatilities in the financial markets, foreign currency exchange rate fluctuations, impacts on consumer confidence and purchasing power, and global recession concerns which could further subject our business to materially adverse consequences should any portion of its impacts become prolonged or escalate beyond its current scope. Additionally, we could also be materially adversely affected by uncertain or reduced demand, labor shortages, delays in collection of outstanding receivables and the impact of any initiatives or programs that we may undertake to address financial and operational challenges faced by our customers. While the overall impact of the COVID-19 pandemic is gradually declining, we continue to be exposed to risks and uncertainties posed by it which varies by geographic region at different levels. The extent to which our business could be impacted in the future by the pandemic is highly uncertain and difficult to predict. Military Conflict in Middle East The recent conflict in the Middle East may further exacerbate general and regional macroeconomic instability, particularly if fighting is prolonged or spreads to other locations. Our iTero business is headquartered in Petach Tikva, Israel. We continue |
Recent Accounting Pronouncements | Recent Accounting Pronouncements (i) Recent Accounting Pronouncements Not Yet Effective We continue to monitor new accounting pronouncements issued by the Financial Accounting Standards Board ( “ FASB ” ) and do not believe any of the recently issued accounting pronouncements will have a material impact on our consolidated financial statements or related disclosures. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Investments, All Other Investments [Abstract] | |
Cash and Cash Equivalents | The following tables summarize our cash and cash equivalents, and marketable securities on our Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022 (in thousands): Reported as: September 30, 2023 Amortized Gross Gross Fair Value Cash and Cash Equivalents Marketable securities, short-term Marketable securities, long-term Cash $ 988,029 $ — $ — $ 988,029 $ 988,029 $ — $ — Money market funds 250,984 — — 250,984 250,984 — — Corporate bonds 44,572 — (1,160) 43,412 — 31,828 11,584 U.S. government treasury bonds 11,394 — (235) 11,159 — 6,503 4,656 Asset-backed securities 2,477 — (7) 2,470 — 1,582 888 Municipal bonds 701 — (10) 691 — 691 — U.S. government agency bonds 5,263 — (66) 5,197 — 4,188 1,009 Total $ 1,303,420 $ — $ (1,478) $ 1,301,942 $ 1,239,013 $ 44,792 $ 18,137 Reported as: December 31, 2022 Amortized Gross Gross Fair Value Cash and Cash Equivalents Marketable securities, short-term Marketable securities, long-term Cash $ 712,921 $ — $ — $ 712,921 $ 712,921 $ — $ — Money market funds 229,129 — — 229,129 229,129 — — Corporate bonds 69,390 — (2,915) 66,475 — 36,510 29,965 U.S. government treasury bonds 20,559 — (549) 20,010 — 15,404 4,606 Asset-backed securities 4,514 1 (37) 4,478 — 2,909 1,569 Municipal bonds 3,447 — (61) 3,386 — 2,711 675 U.S. government agency bonds 5,231 1 (69) 5,163 — — 5,163 Total $ 1,045,191 $ 2 $ (3,631) $ 1,041,562 $ 942,050 $ 57,534 $ 41,978 |
Marketable Securities | The following tables summarize our cash and cash equivalents, and marketable securities on our Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022 (in thousands): Reported as: September 30, 2023 Amortized Gross Gross Fair Value Cash and Cash Equivalents Marketable securities, short-term Marketable securities, long-term Cash $ 988,029 $ — $ — $ 988,029 $ 988,029 $ — $ — Money market funds 250,984 — — 250,984 250,984 — — Corporate bonds 44,572 — (1,160) 43,412 — 31,828 11,584 U.S. government treasury bonds 11,394 — (235) 11,159 — 6,503 4,656 Asset-backed securities 2,477 — (7) 2,470 — 1,582 888 Municipal bonds 701 — (10) 691 — 691 — U.S. government agency bonds 5,263 — (66) 5,197 — 4,188 1,009 Total $ 1,303,420 $ — $ (1,478) $ 1,301,942 $ 1,239,013 $ 44,792 $ 18,137 Reported as: December 31, 2022 Amortized Gross Gross Fair Value Cash and Cash Equivalents Marketable securities, short-term Marketable securities, long-term Cash $ 712,921 $ — $ — $ 712,921 $ 712,921 $ — $ — Money market funds 229,129 — — 229,129 229,129 — — Corporate bonds 69,390 — (2,915) 66,475 — 36,510 29,965 U.S. government treasury bonds 20,559 — (549) 20,010 — 15,404 4,606 Asset-backed securities 4,514 1 (37) 4,478 — 2,909 1,569 Municipal bonds 3,447 — (61) 3,386 — 2,711 675 U.S. government agency bonds 5,231 1 (69) 5,163 — — 5,163 Total $ 1,045,191 $ 2 $ (3,631) $ 1,041,562 $ 942,050 $ 57,534 $ 41,978 |
Contractual Maturity of Marketable Securities | The following table summarizes the fair value of our available-for-sale marketable securities classified by contractual maturity as of September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 December 31, 2022 Due in 1 year or less $ 42,847 $ 51,037 Due in 1 year through 5 years 20,082 48,475 Total $ 62,929 $ 99,512 |
Unrealized Losses for Investments in a Continuous Unrealized Loss Position | The following tables summarize the gross unrealized losses as of September 30, 2023 and December 31, 2022, aggregated by investment category and length of time that individual securities have been in a continuous loss position (in thousands): As of September 30, 2023 Less than 12 months 12 Months of Greater Total September 30, 2023 Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Corporate bonds $ 2,509 $ (11) $ 40,608 $ (1,149) $ 43,117 $ (1,160) U.S. government treasury bonds 1,995 (43) 9,163 (192) 11,158 (235) Asset-backed securities 1,975 (4) 495 (3) 2,470 (7) Municipal bonds — — 691 (10) 691 (10) U.S. government agency bonds 4,030 (28) 1,166 (38) 5,196 (66) Total $ 10,509 $ (86) $ 52,123 $ (1,392) $ 62,632 $ (1,478) As of December 31, 2022 Less than 12 months 12 Months of Greater Total December 31, 2022 Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Corporate bonds $ 10,639 $ (440) $ 54,634 $ (2,475) $ 65,273 $ (2,915) U.S. government treasury bonds 5,262 (177) 14,748 (372) 20,010 (549) Asset-backed securities 2,636 (17) 1,275 (20) 3,911 (37) Municipal bonds — — 2,412 (61) 2,412 (61) U.S. government agency bonds 3,017 (5) 1,136 (64) 4,153 (69) Total $ 21,554 $ (639) $ 74,205 $ (2,992) $ 95,759 $ (3,631) |
Financial Assets Measured At Fair Value On A Recurring Basis | The following tables summarize our financial assets measured at fair value as of September 30, 2023 and December 31, 2022 (in thousands): Description Balance as of Level 1 Level 2 Cash equivalents: Money market funds $ 250,984 $ 250,984 $ — Short-term investments: U.S. government agency bonds 4,188 — 4,188 U.S. government treasury bonds 6,503 6,503 — Corporate bonds 31,828 — 31,828 Municipal bonds 691 — 691 Asset-backed securities 1,582 — 1,582 Long-term investments: U.S. government treasury bonds 4,656 4,656 — Corporate bonds 11,584 — 11,584 U.S. government agency bonds 1,009 — 1,009 Asset-backed securities 888 — 888 $ 313,913 $ 262,143 $ 51,770 Description Balance as of December 31, 2022 Level 1 Level 2 Cash equivalents: Money market funds $ 229,129 $ 229,129 $ — Short-term investments: U.S. government treasury bonds 15,404 15,404 — Corporate bonds 36,510 — 36,510 Municipal bonds 2,711 — 2,711 Asset-backed securities 2,909 — 2,909 Long-term investments: U.S. government treasury bonds 4,606 4,606 — Corporate bonds 29,965 — 29,965 Municipal bonds 675 — 675 U.S. government agency bonds 5,163 — 5,163 Asset-backed securities 1,569 — 1,569 $ 328,641 $ 249,139 $ 79,502 |
Schedule of Notional Amounts of Outstanding Derivative Positions | The following tables present the gross notional value of all our foreign exchange forward contracts outstanding as of September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 Local Currency Amount Notional Contract Amount (USD) Euro €271,600 $ 287,705 Canadian Dollar C$103,200 76,384 Polish Zloty PLN293,200 67,110 British Pound £46,398 56,620 Chinese Yuan ¥399,000 54,764 Swiss Franc CHF27,900 30,615 Japanese Yen ¥4,400,000 29,612 Brazilian Real R$90,000 17,861 Mexican Peso M$230,000 13,214 Israeli Shekel ILS50,300 13,208 New Zealand Dollar NZ$8,700 5,227 Czech Koruna Kč86,800 3,762 Australian Dollar A$3,970 2,567 New Taiwan Dollar NT$77,600 2,405 Korean Won ₩1,400,000 1,036 $ 662,090 December 31, 2022 Local Currency Amount Notional Contract Amount (USD) Euro €186,900 $ 200,010 Polish Zloty PLN365,988 83,307 Canadian Dollar C$109,000 80,514 Chinese Yuan ¥471,000 68,223 British Pound £41,200 49,677 Japanese Yen ¥6,200,000 47,196 Israeli Shekel ILS110,030 31,383 Swiss Franc CHF25,000 27,165 Brazilian Real R$141,200 26,839 Mexican Peso M$230,000 11,746 New Zealand Dollar NZ$6,000 3,806 Australian Dollar A$4,000 2,721 Czech Koruna Kč56,000 2,469 New Taiwan Dollar NT$60,000 1,959 $ 637,015 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Notes To Financial Statements [Abstract] | |
Schedule of Inventories | Inventories consist of the following (in thousands): September 30, December 31, Raw materials $ 139,681 $ 172,758 Work in process 98,633 96,558 Finished goods 57,875 69,436 Total inventories $ 296,189 $ 338,752 |
Schedule of Prepaid Expense and Other Assets | Prepaid expenses and other current assets consist of the following (in thousands): September 30, December 31, Value added tax receivables $ 123,980 $ 140,484 Prepaid expenses 59,496 69,124 Other current assets 34,156 16,762 Total prepaid expenses and other current assets $ 217,632 $ 226,370 |
Schedule of Accrued Liabilities | Accrued liabilities consist of the following (in thousands): September 30, December 31, Accrued payroll and benefits $ 203,712 $ 149,508 Accrued income taxes 157,175 74,323 Accrued expenses 73,087 64,341 Accrued sales and marketing expenses 35,405 36,407 Current operating lease liabilities 28,277 26,574 Accrued property, plant and equipment 14,437 19,922 Other accrued liabilities 102,369 83,299 Total accrued liabilities $ 614,462 $ 454,374 |
Schedule of Warranty Accrual | Accrued warranty, which is included in the "Other accrued liabilities" category of the accrued liabilities table above, consists of the following activity (in thousands): Nine Months Ended 2023 2022 Balance at beginning of period $ 17,873 $ 16,169 Charged to cost of net revenues 14,329 11,359 Actual warranty expenditures (10,327) (11,109) Balance at end of period $ 21,875 $ 16,419 |
Schedule of Deferred Revenues | Deferred revenues consist of the following (in thousands): September 30, December 31, Deferred revenues - current $ 1,408,831 $ 1,343,643 Deferred revenues - long-term 1 $ 146,271 $ 160,662 1 Included in Other long-term liabilities within our Condensed Consolidated Balance Sheet |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Notes To Financial Statements [Abstract] | |
Summary of Goodwill by Reportable Segment | The change in the carrying value of goodwill for the nine months ended September 30, 2023, categorized by reportable segments, is as follows (in thousands): Clear Aligner Systems and Services Total Balance as of December 31, 2022 $ 109,480 $ 298,071 $ 407,551 Foreign currency translation adjustments (479) (2,777) (3,256) Balance as of September 30, 2023 $ 109,001 $ 295,294 $ 404,295 |
Schedule of Amortized Intangible Assets | Acquired intangible long-lived assets were as follows, excluding intangibles that were fully amortized (in thousands): Weighted Average Amortization Period Gross Carrying Amount as of September 30, 2023 Accumulated Amortization Accumulated Impairment Loss Net Carrying Value as of September 30, 2023 Existing technology 10 $ 112,051 $ (42,383) $ (4,328) $ 65,340 Customer relationships 10 21,500 (7,525) — 13,975 Trademarks and tradenames 10 17,200 (7,820) (4,122) 5,258 Patents 8 6,511 (5,884) — 627 $ 157,262 $ (63,612) $ (8,450) 85,200 Foreign currency translation adjustments (2,459) Total intangible assets, net 1 $ 82,741 1 Also includes $33.5 million of fully amortized intangible assets related to customer relationships. Weighted Average Amortization Period Gross Carrying Amount as of December 31, 2022 Accumulated Amortization Accumulated Impairment Loss Net Carrying Value as of December 31, 2022 Existing technology 10 $ 112,051 $ (33,537) $ (4,328) $ 74,186 Customer relationships 10 21,500 (5,913) — 15,587 Trademarks and tradenames 10 17,200 (6,442) (4,122) 6,636 Patents 8 6,511 (5,288) — 1,223 $ 157,262 $ (51,180) $ (8,450) 97,632 Foreign currency translation adjustments (1,912) Total intangible assets, net 1 $ 95,720 1 Also includes $33.5 million of fully amortized intangible assets related to customer relationships. |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The total estimated annual future amortization expense for these acquired intangible assets as of September 30, 2023 is as follows (in thousands): Fiscal Year Ending December 31, Amortization Remainder of 2023 $ 4,069 2024 15,335 2025 14,959 2026 14,353 2027 11,992 Thereafter 24,492 Total $ 85,200 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
Stock-based Compensation Expense | The stock-based compensation related to our stock-based awards and employee stock purchase plan for the three and nine months ended September 30, 2023 and 2022 is as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Cost of net revenues $ 1,974 $ 1,651 $ 5,682 $ 4,779 Selling, general and administrative 29,739 25,293 87,432 76,509 Research and development 7,889 5,974 22,083 17,391 Total stock-based compensation $ 39,602 $ 32,918 $ 115,197 $ 98,679 |
Summary Of Restricted Stock Units | A summary for the nine months ended September 30, 2023 is as follows: Number of Shares Underlying RSUs (in thousands) Weighted Average Grant Date Fair Value Weighted Average Remaining Aggregate Unvested as of December 31, 2022 489 $ 427.24 Granted 508 316.52 Vested and released (196) 378.93 Forfeited (37) 388.56 Unvested as of September 30, 2023 764 $ 367.93 1.6 $ 233,165 |
Summary Of Market-performance Based Restricted Stock Units | The following table summarizes the MSU performance activity for the nine months ended September 30, 2023: Number of Shares Underlying MSUs (in thousands) Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term (in years) Aggregate Unvested as of December 31, 2022 144 $ 725.73 Granted 82 629.53 Vested and released 1 (25) 392.67 Forfeited (43) 423.87 Unvested as of September 30, 2023 158 $ 811.06 1.7 $ 48,135 |
Schedule of Share-based Payment Award, Employee Stock Purchase Plan, Valuation Assumptions | The fair value of the option component of the 2010 Purchase Plan shares was estimated at the grant date using the Black-Scholes option pricing model with the following weighted average assumptions: Nine Months Ended 2023 2022 Expected term (in years) 1.2 1.5 Expected volatility 56.2 % 50.2 % Risk-free interest rate 4.9 % 1.8 % Expected dividends — — Weighted average fair value at grant date $ 133.53 $ 159.44 |
Common Stock Repurchase Progr_2
Common Stock Repurchase Programs (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Disclosure Common Stock Repurchase Program Additional Information [Abstract] | |
Accelerated Share Repurchase Agreements | Agreement Repurchase Amount Paid Completion Total Shares Average Price per Share Q4 2022 May 2021 N/A 1 Q1 2023 136,448 $ 293.15 Q1 2023 May 2021 $ 250.0 Q1 2023 805,905 $ 310.21 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule Of Earnings Per Share Basic And Diluted | The following table sets forth the computation of basic and diluted net income per share attributable to common stock (in thousands, except per share amounts): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Numerator: Net income $ 121,427 $ 72,700 $ 321,039 $ 319,798 Denominator: Weighted average common shares outstanding, basic 76,569 78,093 76,670 78,408 Dilutive effect of potential common stock 257 144 179 244 Total shares, diluted 76,826 78,237 76,849 78,652 Net income per share, basic $ 1.59 $ 0.93 $ 4.19 $ 4.08 Net income per share, diluted $ 1.58 $ 0.93 $ 4.18 $ 4.07 Anti-dilutive potential common shares 1 245 345 263 317 1 Represents RSU and MSU shares excluded from the calculation of diluted net income per share as the effect would have been anti-dilutive. |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Supplemental Cash Flow Information [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures | The supplemental cash flow information consists of the following (in thousands): Nine Months Ended 2023 2022 Non-cash investing and financing activities: Acquisition of property, plant and equipment in accounts payable and accrued liabilities $ 25,979 $ 41,255 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 25,559 $ 23,310 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 25,048 $ 26,532 |
Segments and Geographical Inf_2
Segments and Geographical Information (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Summarized financial information by segment is as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Net revenues Clear Aligner $ 794,939 $ 732,837 $ 2,417,417 $ 2,340,931 Systems and Services 165,275 157,511 488,117 492,189 Total net revenues $ 960,214 $ 890,348 $ 2,905,534 $ 2,833,120 Gross profit Clear Aligner $ 562,331 $ 519,387 $ 1,731,721 $ 1,710,328 Systems and Services 100,745 99,782 305,618 305,746 Total gross profit $ 663,076 $ 619,169 $ 2,037,339 $ 2,016,074 Income from operations Clear Aligner $ 296,319 $ 259,434 $ 879,933 $ 879,362 Systems and Services 44,975 44,436 132,600 140,834 Unallocated corporate expenses (174,948) (160,214) (540,740) (490,262) Total income from operations $ 166,346 $ 143,656 $ 471,793 $ 529,934 Stock-based compensation Clear Aligner $ 5,772 $ 4,377 $ 14,917 $ 10,232 Systems and Services 366 240 950 690 Unallocated corporate expenses 33,464 28,301 99,330 87,757 Total stock-based compensation $ 39,602 $ 32,918 $ 115,197 $ 98,679 Depreciation and amortization Clear Aligner $ 17,737 $ 14,678 $ 50,725 $ 42,474 Systems and Services 7,827 7,181 23,716 20,879 Unallocated corporate expenses 11,466 10,330 34,228 28,743 Total depreciation and amortization $ 37,030 $ 32,189 $ 108,669 $ 92,096 The following table reconciles total segment income from operations in the table above to net income before provision for income taxes (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Total segment income from operations $ 341,294 $ 303,870 $ 1,012,533 $ 1,020,196 Unallocated corporate expenses (174,948) (160,214) (540,740) (490,262) Total income from operations 166,346 143,656 471,793 529,934 Interest income 5,522 1,685 12,280 2,607 Other income (expense), net (9,757) (22,700) (15,749) (48,805) Net income before provision for income taxes $ 162,111 $ 122,641 $ 468,324 $ 483,736 |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas | Net revenues are presented below by geographic area (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Net revenues 1 : U.S. $ 421,272 $ 400,045 $ 1,262,008 $ 1,251,018 Switzerland 259,587 257,845 913,724 919,935 Other International 279,355 232,458 729,802 662,167 Total net revenues $ 960,214 $ 890,348 $ 2,905,534 $ 2,833,120 1 Net revenues are attributed to countries based on the location of where revenues are recognized by our legal entities. Tangible long-lived assets, which includes Property, plant and equipment, net, and Operating lease right-of-use assets, net, are presented below by geographic area (in thousands): September 30, December 31, 2022 Long-lived assets 1 : Switzerland $ 567,230 $ 532,921 U.S. 206,348 214,804 Other International 2 613,776 603,010 Total long-lived assets $ 1,387,354 $ 1,350,735 1 Long-lived assets are attributed to countries based on the location of our entity that owns or leases the assets. 2 Certain prior period immaterial amounts have been reclassified to conform to current presentation. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Jun. 30, 2023 | |
Change in Accounting Estimate [Line Items] | |||||
Increase in net income | $ 121,427 | $ 72,700 | $ 321,039 | $ 319,798 | |
Increase in basic earnings per share (in usd per share) | $ 1.59 | $ 0.93 | $ 4.19 | $ 4.08 | |
Increase in diluted earnings per share (in usd per share) | $ 1.58 | $ 0.93 | $ 4.18 | $ 4.07 | |
Change in useful life | |||||
Change in Accounting Estimate [Line Items] | |||||
Decrease in depreciation | $ 4,000 | $ 4,000 | |||
Increase in net income | $ 3,000 | $ 3,000 | |||
Increase in basic earnings per share (in usd per share) | $ 0.04 | $ 0.04 | |||
Increase in diluted earnings per share (in usd per share) | $ 0.04 | $ 0.04 | |||
Manufacturing equipment | Change in useful life | |||||
Change in Accounting Estimate [Line Items] | |||||
Useful life | 13 years | 13 years | 10 years |
Financial Instruments - Cash, C
Financial Instruments - Cash, Cash Equivalents and Marketable Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Amortized Cost | ||
Cash, cash equivalents and marketable securities | $ 1,303,420 | $ 1,045,191 |
Gross Unrealized Gains | ||
Cash, cash equivalents and marketable securities | 0 | 2 |
Gross Unrealized Losses | ||
Cash, cash equivalents and marketable securities | (1,478) | (3,631) |
Fair Value | ||
Cash and cash equivalents | 1,239,013 | 942,050 |
Marketable securities | 62,929 | 99,512 |
Cash, cash equivalents and marketable securities | 1,301,942 | 1,041,562 |
Cash | ||
Amortized Cost | ||
Cash and cash equivalents | 988,029 | 712,921 |
Fair Value | ||
Cash and cash equivalents | 988,029 | 712,921 |
Cash and Cash Equivalents | ||
Fair Value | ||
Cash, cash equivalents and marketable securities | 1,239,013 | 942,050 |
Cash and Cash Equivalents | Cash | ||
Fair Value | ||
Cash and cash equivalents | 988,029 | 712,921 |
Marketable securities, short-term | ||
Fair Value | ||
Cash, cash equivalents and marketable securities | 44,792 | 57,534 |
Marketable securities, long-term | ||
Fair Value | ||
Cash, cash equivalents and marketable securities | 18,137 | 41,978 |
Money market funds | ||
Amortized Cost | ||
Cash and cash equivalents | 250,984 | 229,129 |
Fair Value | ||
Cash and cash equivalents | 250,984 | 229,129 |
Money market funds | Cash and Cash Equivalents | ||
Fair Value | ||
Cash and cash equivalents | 250,984 | 229,129 |
Corporate bonds | ||
Amortized Cost | ||
Marketable securities | 44,572 | 69,390 |
Gross Unrealized Gains | ||
Marketable securities | 0 | 0 |
Gross Unrealized Losses | ||
Marketable securities | (1,160) | (2,915) |
Fair Value | ||
Marketable securities | 43,412 | 66,475 |
Corporate bonds | Cash and Cash Equivalents | ||
Fair Value | ||
Marketable securities | 0 | |
Corporate bonds | Marketable securities, short-term | ||
Fair Value | ||
Marketable securities | 31,828 | 36,510 |
Corporate bonds | Marketable securities, long-term | ||
Fair Value | ||
Marketable securities | 11,584 | 29,965 |
U.S. government treasury bonds | ||
Amortized Cost | ||
Marketable securities | 11,394 | 20,559 |
Gross Unrealized Gains | ||
Marketable securities | 0 | 0 |
Gross Unrealized Losses | ||
Marketable securities | (235) | (549) |
Fair Value | ||
Marketable securities | 11,159 | 20,010 |
U.S. government treasury bonds | Marketable securities, short-term | ||
Fair Value | ||
Marketable securities | 6,503 | 15,404 |
U.S. government treasury bonds | Marketable securities, long-term | ||
Fair Value | ||
Marketable securities | 4,656 | 4,606 |
Asset-backed securities | ||
Amortized Cost | ||
Marketable securities | 2,477 | 4,514 |
Gross Unrealized Gains | ||
Marketable securities | 0 | 1 |
Gross Unrealized Losses | ||
Marketable securities | (7) | (37) |
Fair Value | ||
Marketable securities | 2,470 | 4,478 |
Asset-backed securities | Marketable securities, short-term | ||
Fair Value | ||
Marketable securities | 1,582 | 2,909 |
Asset-backed securities | Marketable securities, long-term | ||
Fair Value | ||
Marketable securities | 888 | 1,569 |
Municipal bonds | ||
Amortized Cost | ||
Marketable securities | 701 | 3,447 |
Gross Unrealized Gains | ||
Marketable securities | 0 | 0 |
Gross Unrealized Losses | ||
Marketable securities | (10) | (61) |
Fair Value | ||
Marketable securities | 691 | 3,386 |
Municipal bonds | Cash and Cash Equivalents | ||
Fair Value | ||
Marketable securities | 0 | |
Municipal bonds | Marketable securities, short-term | ||
Fair Value | ||
Marketable securities | 691 | 2,711 |
Municipal bonds | Marketable securities, long-term | ||
Fair Value | ||
Marketable securities | 0 | 675 |
U.S. government agency bonds | ||
Amortized Cost | ||
Marketable securities | 5,263 | 5,231 |
Gross Unrealized Gains | ||
Marketable securities | 0 | 1 |
Gross Unrealized Losses | ||
Marketable securities | (66) | (69) |
Fair Value | ||
Marketable securities | 5,197 | 5,163 |
U.S. government agency bonds | Marketable securities, short-term | ||
Fair Value | ||
Marketable securities | 4,188 | |
U.S. government agency bonds | Marketable securities, long-term | ||
Fair Value | ||
Marketable securities | $ 1,009 | $ 5,163 |
Financial Instruments - Contrac
Financial Instruments - Contractual Maturity of Marketable Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value Disclosures [Abstract] | ||
Due in 1 year or less | $ 42,847 | $ 51,037 |
Due in 1 year through 5 years | 20,082 | 48,475 |
Total | $ 62,929 | $ 99,512 |
Financial Instruments - Unreali
Financial Instruments - Unrealized Losses for Investments in a Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Securities, Available-for-Sale, Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | $ 10,509 | $ 21,554 |
12 months or greater, fair value | 52,123 | 74,205 |
Fair value | 62,632 | 95,759 |
Less than 12 months, unrealized loss | (86) | (639) |
12 months or greater, unrealized loss | (1,392) | (2,992) |
Unrealized loss | (1,478) | (3,631) |
Corporate bonds | ||
Debt Securities, Available-for-Sale, Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | 2,509 | 10,639 |
12 months or greater, fair value | 40,608 | 54,634 |
Fair value | 43,117 | 65,273 |
Less than 12 months, unrealized loss | (11) | (440) |
12 months or greater, unrealized loss | (1,149) | (2,475) |
Unrealized loss | (1,160) | (2,915) |
U.S. government treasury bonds | ||
Debt Securities, Available-for-Sale, Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | 1,995 | 5,262 |
12 months or greater, fair value | 9,163 | 14,748 |
Fair value | 11,158 | 20,010 |
Less than 12 months, unrealized loss | (43) | (177) |
12 months or greater, unrealized loss | (192) | (372) |
Unrealized loss | (235) | (549) |
Asset-backed securities | ||
Debt Securities, Available-for-Sale, Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | 1,975 | 2,636 |
12 months or greater, fair value | 495 | 1,275 |
Fair value | 2,470 | 3,911 |
Less than 12 months, unrealized loss | (4) | (17) |
12 months or greater, unrealized loss | (3) | (20) |
Unrealized loss | (7) | (37) |
Municipal bonds | ||
Debt Securities, Available-for-Sale, Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | 0 | 0 |
12 months or greater, fair value | 691 | 2,412 |
Fair value | 691 | 2,412 |
Less than 12 months, unrealized loss | 0 | 0 |
12 months or greater, unrealized loss | (10) | (61) |
Unrealized loss | (10) | (61) |
U.S. government agency bonds | ||
Debt Securities, Available-for-Sale, Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | 4,030 | 3,017 |
12 months or greater, fair value | 1,166 | 1,136 |
Fair value | 5,196 | 4,153 |
Less than 12 months, unrealized loss | (28) | (5) |
12 months or greater, unrealized loss | (38) | (64) |
Unrealized loss | $ (66) | $ (69) |
Financial Instruments - Fair Va
Financial Instruments - Fair Value Measured On A Recurring Basis (Detail) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | $ 44,792,000 | $ 57,534,000 |
Long-term investments | 18,137,000 | 41,978,000 |
Assets measured at fair value | 313,913,000 | 328,641,000 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Assets measured at fair value | 262,143,000 | 249,139,000 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Assets measured at fair value | 51,770,000 | 79,502,000 |
U.S. government agency bonds | Fair Value, Measurements, Recurring | Short-term investments: | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 4,188,000 | |
U.S. government agency bonds | Fair Value, Measurements, Recurring | Level 1 | Short-term investments: | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 0 | |
U.S. government agency bonds | Fair Value, Measurements, Recurring | Level 2 | Short-term investments: | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 4,188,000 | |
U.S. government treasury bonds | Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 6,503,000 | 15,404,000 |
Long-term investments | 4,656,000 | 4,606,000 |
U.S. government treasury bonds | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 6,503,000 | 15,404,000 |
Long-term investments | 4,656,000 | 4,606,000 |
U.S. government treasury bonds | Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Long-term investments | 0 | 0 |
Corporate bonds | Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 31,828,000 | 36,510,000 |
Long-term investments | 11,584,000 | 29,965,000 |
Corporate bonds | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Long-term investments | 0 | 0 |
Corporate bonds | Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 31,828,000 | 36,510,000 |
Long-term investments | 11,584,000 | 29,965,000 |
Municipal bonds | Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 691,000 | 2,711,000 |
Long-term investments | 675,000 | |
Municipal bonds | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Long-term investments | 0 | |
Municipal bonds | Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 691,000 | 2,711,000 |
Long-term investments | 675,000 | |
U.S. government agency bonds | Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Long-term investments | 1,009,000 | 5,163,000 |
U.S. government agency bonds | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Long-term investments | 0 | 0 |
U.S. government agency bonds | Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Long-term investments | 1,009,000 | 5,163,000 |
Asset-backed securities | Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 1,582,000 | 2,909,000 |
Long-term investments | 888,000 | 1,569,000 |
Asset-backed securities | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Long-term investments | 0 | 0 |
Asset-backed securities | Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Short-term investments | 1,582,000 | 2,909,000 |
Long-term investments | 888,000 | 1,569,000 |
Money market funds | Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Cash equivalents | 250,984,000 | 229,129,000 |
Money market funds | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Cash equivalents | 250,984,000 | 229,129,000 |
Money market funds | Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Cash equivalents | $ 0 | $ 0 |
Financial Instruments - Narrati
Financial Instruments - Narrative (Details) $ in Thousands, € in Millions | 3 Months Ended | 9 Months Ended | |||||
Sep. 06, 2023 EUR (€) | Apr. 24, 2023 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Marketable Securities and Fair Value Measurements [Abstract] | |||||||
Accounts receivable sold | $ 24,200 | $ 40,400 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Payments to acquire equity method investments | 76,999 | $ 0 | |||||
Cubicure GmbH | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Acquisition consideration | € | € 79 | ||||||
Heartland | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Ownership interest | 5% | ||||||
Payments to acquire equity method investments | $ 75,000 | ||||||
Equity method investments | 75,000 | 75,000 | |||||
Foreign Exchange Forward | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Net gains (losses) on derivatives | 19,800 | $ 34,600 | (14,400) | $ 43,800 | |||
Fair value of derivative asset | $ 0 | $ 0 | $ 0 |
Financial Instruments - Derivat
Financial Instruments - Derivative Financial Instruments (Details) - Level 2 - Prepaid expenses and other current assets: - Foreign Exchange Forward € in Thousands, ₪ in Thousands, ₩ in Thousands, ¥ in Thousands, ¥ in Thousands, £ in Thousands, zł in Thousands, SFr in Thousands, R$ in Thousands, Kč in Thousands, $ in Thousands, $ in Thousands, $ in Thousands, $ in Thousands, $ in Thousands, $ in Thousands | Sep. 30, 2023 EUR (€) | Sep. 30, 2023 USD ($) | Sep. 30, 2023 CAD ($) | Sep. 30, 2023 PLN (zł) | Sep. 30, 2023 GBP (£) | Sep. 30, 2023 CNY (¥) | Sep. 30, 2023 CHF (SFr) | Sep. 30, 2023 JPY (¥) | Sep. 30, 2023 BRL (R$) | Sep. 30, 2023 MXN ($) | Sep. 30, 2023 ILS (₪) | Sep. 30, 2023 NZD ($) | Sep. 30, 2023 CZK (Kč) | Sep. 30, 2023 AUD ($) | Sep. 30, 2023 TWD ($) | Sep. 30, 2023 KRW (₩) | Dec. 31, 2022 EUR (€) | Dec. 31, 2022 USD ($) | Dec. 31, 2022 CAD ($) | Dec. 31, 2022 PLN (zł) | Dec. 31, 2022 GBP (£) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 CHF (SFr) | Dec. 31, 2022 JPY (¥) | Dec. 31, 2022 BRL (R$) | Dec. 31, 2022 MXN ($) | Dec. 31, 2022 ILS (₪) | Dec. 31, 2022 NZD ($) | Dec. 31, 2022 CZK (Kč) | Dec. 31, 2022 AUD ($) | Dec. 31, 2022 TWD ($) |
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | $ 662,090 | $ 637,015 | |||||||||||||||||||||||||||||
Euro | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | € 271,600 | 287,705 | € 186,900 | 200,010 | |||||||||||||||||||||||||||
Canadian Dollar | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 76,384 | $ 103,200 | 80,514 | $ 109,000 | |||||||||||||||||||||||||||
Polish Zloty | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 67,110 | zł 293,200 | 83,307 | zł 365,988 | |||||||||||||||||||||||||||
British Pound | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 56,620 | £ 46,398 | 49,677 | £ 41,200 | |||||||||||||||||||||||||||
Chinese Yuan | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 54,764 | ¥ 399,000 | 68,223 | ¥ 471,000 | |||||||||||||||||||||||||||
Swiss Franc | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 30,615 | SFr 27,900 | 27,165 | SFr 25,000 | |||||||||||||||||||||||||||
Japanese Yen | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 29,612 | ¥ 4,400,000 | 47,196 | ¥ 6,200,000 | |||||||||||||||||||||||||||
Brazilian Real | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 17,861 | R$ 90000 | 26,839 | R$ 141200 | |||||||||||||||||||||||||||
Mexican Peso | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 13,214 | $ 230,000 | 11,746 | $ 230,000 | |||||||||||||||||||||||||||
Israeli Shekel | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 13,208 | ₪ 50,300 | 31,383 | ₪ 110,030 | |||||||||||||||||||||||||||
New Zealand Dollar | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 5,227 | $ 8,700 | 3,806 | $ 6,000 | |||||||||||||||||||||||||||
Czech Koruna | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 3,762 | Kč 86,800 | 2,469 | Kč 56,000 | |||||||||||||||||||||||||||
Australian Dollar | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 2,567 | $ 3,970 | 2,721 | $ 4,000 | |||||||||||||||||||||||||||
New Taiwan Dollar | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | 2,405 | $ 77,600 | $ 1,959 | $ 60,000 | |||||||||||||||||||||||||||
Korean Won | |||||||||||||||||||||||||||||||
Derivative [Line Items] | |||||||||||||||||||||||||||||||
Notional amount | $ 1,036 | ₩ 1,400,000 |
Balance Sheet Components Invent
Balance Sheet Components Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Notes To Financial Statements [Abstract] | ||
Raw materials | $ 139,681 | $ 172,758 |
Work in process | 98,633 | 96,558 |
Finished goods | 57,875 | 69,436 |
Total inventories | $ 296,189 | $ 338,752 |
Balance Sheet Components Prepai
Balance Sheet Components Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Notes To Financial Statements [Abstract] | ||
Value added tax receivables | $ 123,980 | $ 140,484 |
Prepaid expenses | 59,496 | 69,124 |
Other current assets | 34,156 | 16,762 |
Total prepaid expenses and other current assets | $ 217,632 | $ 226,370 |
Balance Sheet Components Accrue
Balance Sheet Components Accrued Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Notes To Financial Statements [Abstract] | ||
Accrued payroll and benefits | $ 203,712 | $ 149,508 |
Accrued income taxes | 157,175 | 74,323 |
Accrued expenses | 73,087 | 64,341 |
Accrued sales and marketing expenses | 35,405 | 36,407 |
Current operating lease liabilities | 28,277 | 26,574 |
Accrued property, plant and equipment | 14,437 | 19,922 |
Other accrued liabilities | 102,369 | 83,299 |
Accrued liabilities | $ 614,462 | $ 454,374 |
Balance Sheet Components Warran
Balance Sheet Components Warranty Accrual Activity (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Balance at beginning of period | $ 17,873 | $ 16,169 |
Charged to cost of net revenues | 14,329 | 11,359 |
Actual warranty expenditures | (10,327) | (11,109) |
Balance at end of period | $ 21,875 | $ 16,419 |
Balance Sheet Components Deferr
Balance Sheet Components Deferred Revenues (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Notes To Financial Statements [Abstract] | ||
Deferred revenues - current | $ 1,408,831 | $ 1,343,643 |
Deferred revenues - long-term | $ 146,271 | $ 160,662 |
Balance Sheet Components Narrat
Balance Sheet Components Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Net revenues | $ 960,214 | $ 890,348 | $ 2,905,534 | $ 2,833,120 |
Revenue recognized included in deferred revenue | 178,800 | $ 156,500 | 583,500 | $ 519,800 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01 | ||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Revenue, remaining performance obligation | $ 1,560,700 | $ 1,560,700 | ||
Minimum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01 | ||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Revenue, remaining performance obligation, period of recognition | 6 months | 6 months | ||
Maximum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01 | ||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Revenue, remaining performance obligation, period of recognition | 5 years | 5 years |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Change in Carrying Value of Goodwill (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Goodwill [Roll Forward] | |
Balance as of December 31, 2022 | $ 407,551 |
Foreign currency translation adjustments | (3,256) |
Balance as of September 30, 2023 | 404,295 |
Clear Aligner | |
Goodwill [Roll Forward] | |
Balance as of December 31, 2022 | 109,480 |
Foreign currency translation adjustments | (479) |
Balance as of September 30, 2023 | 109,001 |
Systems and Services | |
Goodwill [Roll Forward] | |
Balance as of December 31, 2022 | 298,071 |
Foreign currency translation adjustments | (2,777) |
Balance as of September 30, 2023 | $ 295,294 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 157,262 | $ 157,262 |
Accumulated Amortization | (63,612) | (51,180) |
Accumulated Impairment Loss | (8,450) | (8,450) |
Net carrying value | 85,200 | 97,632 |
Foreign currency translation adjustments | (2,459) | (1,912) |
Total intangible assets | $ 82,741 | $ 95,720 |
Existing technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (in years) | 10 years | 10 years |
Gross carrying amount | $ 112,051 | $ 112,051 |
Accumulated Amortization | (42,383) | (33,537) |
Accumulated Impairment Loss | (4,328) | (4,328) |
Net carrying value | $ 65,340 | $ 74,186 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (in years) | 10 years | 10 years |
Gross carrying amount | $ 21,500 | $ 21,500 |
Accumulated Amortization | (7,525) | (5,913) |
Accumulated Impairment Loss | 0 | 0 |
Net carrying value | 13,975 | 15,587 |
Fully amortized intangible assets | $ 33,500 | $ 33,500 |
Trademarks and tradenames | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (in years) | 10 years | 10 years |
Gross carrying amount | $ 17,200 | $ 17,200 |
Accumulated Amortization | (7,820) | (6,442) |
Accumulated Impairment Loss | (4,122) | (4,122) |
Net carrying value | $ 5,258 | $ 6,636 |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (in years) | 8 years | 8 years |
Gross carrying amount | $ 6,511 | $ 6,511 |
Accumulated Amortization | (5,884) | (5,288) |
Accumulated Impairment Loss | 0 | 0 |
Net carrying value | $ 627 | $ 1,223 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Total Estimated Annual Future Amortization Expense for Acquired Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Disclosure Total Estimated Annual Future Amortization Expense For Acquired Intangible Assets [Abstract] | ||
Remainder of 2023 | $ 4,069 | |
2024 | 15,335 | |
2025 | 14,959 | |
2026 | 14,353 | |
2027 | 11,992 | |
Thereafter | 24,492 | |
Net carrying value | $ 85,200 | $ 97,632 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization | $ 4.2 | $ 3.9 | $ 12.4 | $ 12.1 |
Credit Facility - Additional In
Credit Facility - Additional Information (Details) - 2022 Credit Facility | Sep. 30, 2023 USD ($) |
Line of Credit Facility [Line Items] | |
Outstanding borrowings | $ 0 |
Revolving Credit Facility | |
Line of Credit Facility [Line Items] | |
Line of credit, available borrowings | 300,000,000 |
Letter of Credit | |
Line of Credit Facility [Line Items] | |
Line of credit, available borrowings | $ 50,000,000 |
Legal Proceedings (Details)
Legal Proceedings (Details) $ in Millions | 1 Months Ended | ||
Sep. 08, 2023 USD ($) | Oct. 27, 2022 USD ($) | Jan. 31, 2019 claim | |
Legal Proceedings [Abstract] | |||
Number of lawsuits filed | claim | 3 | ||
Gain contingency, amount awarded | $ | $ 63 | $ 63 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 3 Months Ended |
Sep. 30, 2023 USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Damages sought | $ 27 |
Potential exposure | $ 100 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
Incentive Plan 2005 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares reserved for issuance | 32,168,895 | |
Shares available for issuance | 4,754,771 | |
Employee Stock Purchase Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares available for issuance | 1,995,520 | |
Total unamortized compensation cost | $ 11.6 | |
Weighted average period of total unamortized cost (in years) | 8 months 12 days | |
Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 4 years | |
Total unamortized compensation cost | $ 202.1 | |
Weighted average period of total unamortized cost (in years) | 2 years 9 months 18 days | |
Total granted (in shares) | 764,000 | 489,000 |
Weighted average grant date fair value (in usd per share) | $ 367.93 | $ 427.24 |
Market Performance Based Restricted Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 3 years | |
Total unamortized compensation cost | $ 56.8 | |
Weighted average period of total unamortized cost (in years) | 1 year 8 months 12 days | |
Maximum percentage of market-performance based restricted stock units eligible to vest over the vesting period | 250% | |
Total granted (in shares) | 158,000 | 144,000 |
Weighted average grant date fair value (in usd per share) | $ 811.06 | $ 725.73 |
PSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total unamortized compensation cost | $ 0.5 | |
Weighted average period of total unamortized cost (in years) | 1 year 3 months 18 days | |
Total granted (in shares) | 4,728 | |
Weighted average grant date fair value (in usd per share) | $ 201.63 |
Stockholders' Equity - Stock-Ba
Stockholders' Equity - Stock-Based Compensation Expense Related to All Stock-Based Awards and Employee Stock Purchases (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | $ 39,602 | $ 32,918 | $ 115,197 | $ 98,679 |
Cost of net revenues | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 1,974 | 1,651 | 5,682 | 4,779 |
Selling, general and administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 29,739 | 25,293 | 87,432 | 76,509 |
Research and development | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | $ 7,889 | $ 5,974 | $ 22,083 | $ 17,391 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Nonvested Shares (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) $ / shares shares | |
Restricted Stock Units (RSUs) | |
Number of Shares Underlying RSUs | |
Unvested, beginning of period (in shares) | shares | 489 |
Granted (in shares) | shares | 508 |
Vested and released (in shares) | shares | (196) |
Forfeited (in shares) | shares | (37) |
Unvested, end of period (in shares) | shares | 764 |
Weighted Average Grant Date Fair Value | |
Unvested, beginning of period (in usd per share) | $ / shares | $ 427.24 |
Granted (in usd per share) | $ / shares | 316.52 |
Vested and released (in usd per share) | $ / shares | 378.93 |
Forfeited (in usd per share) | $ / shares | 388.56 |
Unvested, end of period (in usd per share) | $ / shares | $ 367.93 |
Weighted Average Remaining Contractual Term (in years) | |
Weighted average remaining contractual term | 1 year 7 months 6 days |
Aggregate Intrinsic Value | |
Aggregate intrinsic value | $ | $ 233,165 |
Market Performance Based Restricted Stock Units | |
Number of Shares Underlying RSUs | |
Unvested, beginning of period (in shares) | shares | 144 |
Granted (in shares) | shares | 82 |
Vested and released (in shares) | shares | (25) |
Forfeited (in shares) | shares | (43) |
Unvested, end of period (in shares) | shares | 158 |
Weighted Average Grant Date Fair Value | |
Unvested, beginning of period (in usd per share) | $ / shares | $ 725.73 |
Granted (in usd per share) | $ / shares | 629.53 |
Vested and released (in usd per share) | $ / shares | 392.67 |
Forfeited (in usd per share) | $ / shares | 423.87 |
Unvested, end of period (in usd per share) | $ / shares | $ 811.06 |
Weighted Average Remaining Contractual Term (in years) | |
Weighted average remaining contractual term | 1 year 8 months 12 days |
Aggregate Intrinsic Value | |
Aggregate intrinsic value | $ | $ 48,135 |
Stockholders' Equity - Stock-_2
Stockholders' Equity - Stock-based Compensation Employee Stock Purchase Plan Fair Value Assumptions (Details) - Employee Stock Purchase Plan - $ / shares | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Class of Stock [Line Items] | ||
Expected term (in years) | 1 year 2 months 12 days | 1 year 6 months |
Expected volatility | 56.20% | 50.20% |
Risk-free interest rate | 4.90% | 1.80% |
Expected dividends | 0% | 0% |
Weighted average fair value at grant date (in usd per share) | $ 133.53 | $ 159.44 |
Common Stock Repurchase Progr_3
Common Stock Repurchase Programs - Additional Information (Details) - USD ($) shares in Millions | 9 Months Ended | ||||
Oct. 26, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Jan. 31, 2023 | May 31, 2021 | |
Share Repurchases [Line Items] | |||||
Amount paid | $ 292,360,000 | $ 275,036,000 | |||
May 2021 Repurchase Program | |||||
Share Repurchases [Line Items] | |||||
Authorized repurchase amount | $ 1,000,000,000 | ||||
January 2023 Repurchase Program | |||||
Share Repurchases [Line Items] | |||||
Authorized repurchase amount | $ 1,000,000,000 | ||||
Amount available for repurchase | $ 1,000,000,000 | ||||
October 2023 Repurchase Program | Subsequent Event | |||||
Share Repurchases [Line Items] | |||||
Authorized repurchase amount | $ 250,000,000 | ||||
Amount paid | $ 250,000,000 | ||||
Shares repurchased (in shares) | 1 |
Common Stock Repurchase Progr_4
Common Stock Repurchase Programs - Accelerated Share Repurchase Agreements (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | May 31, 2021 | |
Share Repurchases [Line Items] | |||||
Amount paid | $ 292,360,000 | $ 275,036,000 | |||
May 2021 Repurchase Program | |||||
Share Repurchases [Line Items] | |||||
Authorized repurchase amount | $ 1,000,000,000 | ||||
May 2021 Repurchase Program | Fourth Quarter 2022 | |||||
Share Repurchases [Line Items] | |||||
Amount paid | $ 40,000,000 | ||||
Total shares received (in shares) | 136,448 | ||||
Average price per share (in dollars per share) | $ 293.15 | ||||
Authorized repurchase amount | $ 200,000,000 | ||||
May 2021 Repurchase Program | First Quarter 2023 | |||||
Share Repurchases [Line Items] | |||||
Amount paid | $ 250,000,000 | ||||
Total shares received (in shares) | 805,905 | ||||
Average price per share (in dollars per share) | $ 310.21 |
Accounting for Income Taxes - A
Accounting for Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Disclosure Accounting For Income Taxes Additional Information [Abstract] | |||||
Provision for income taxes | $ 40,684 | $ 49,941 | $ 147,285 | $ 163,938 | |
Effective income tax rate, continuing operations | 25.10% | 40.70% | 31.40% | 33.90% | |
Unrecognized tax benefits | $ 150,000 | $ 150,000 | $ 141,600 |
Computation of Basic and Dilute
Computation of Basic and Diluted Net Income Per Share Attributable to Common Stock (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 121,427 | $ 72,700 | $ 321,039 | $ 319,798 |
Weighted average common shares outstanding, basic (in shares) | 76,569 | 78,093 | 76,670 | 78,408 |
Dilutive effect of potential common stock (in shares) | 257 | 144 | 179 | 244 |
Total shares, diluted (in shares) | 76,826 | 78,237 | 76,849 | 78,652 |
Net income per share, basic (in usd per share) | $ 1.59 | $ 0.93 | $ 4.19 | $ 4.08 |
Net income per share, diluted (in usd per share) | $ 1.58 | $ 0.93 | $ 4.18 | $ 4.07 |
Anti-dilutive potential common shares (in shares) | 245 | 345 | 263 | 317 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Non-cash investing and financing activities: | ||
Acquisition of property, plant and equipment in accounts payable and accrued liabilities | $ 25,979 | $ 41,255 |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | 25,559 | 23,310 |
Right-of-use assets obtained in exchange for lease obligations: | ||
Operating leases | $ 25,048 | $ 26,532 |
Segments and Geographical Inf_3
Segments and Geographical Information - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2023 segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Segments and Geographical Inf_4
Segments and Geographical Information - Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Segment Reporting Information [Line Items] | ||||
Net revenues | $ 960,214 | $ 890,348 | $ 2,905,534 | $ 2,833,120 |
Gross profit | 663,076 | 619,169 | 2,037,339 | 2,016,074 |
Income from operations | 166,346 | 143,656 | 471,793 | 529,934 |
Stock-based compensation | 39,602 | 32,918 | 115,197 | 98,679 |
Depreciation and amortization | 37,030 | 32,189 | 108,669 | 92,096 |
Interest income | 5,522 | 1,685 | 12,280 | 2,607 |
Other income (expense), net | (9,757) | (22,700) | (15,749) | (48,805) |
Net income before provision for income taxes | 162,111 | 122,641 | 468,324 | 483,736 |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations | 341,294 | 303,870 | 1,012,533 | 1,020,196 |
Unallocated corporate expenses | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations | (174,948) | (160,214) | (540,740) | (490,262) |
Stock-based compensation | 33,464 | 28,301 | 99,330 | 87,757 |
Depreciation and amortization | 11,466 | 10,330 | 34,228 | 28,743 |
Clear Aligner | ||||
Segment Reporting Information [Line Items] | ||||
Net revenues | 794,939 | 732,837 | 2,417,417 | 2,340,931 |
Gross profit | 562,331 | 519,387 | 1,731,721 | 1,710,328 |
Clear Aligner | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations | 296,319 | 259,434 | 879,933 | 879,362 |
Stock-based compensation | 5,772 | 4,377 | 14,917 | 10,232 |
Depreciation and amortization | 17,737 | 14,678 | 50,725 | 42,474 |
Systems and Services | ||||
Segment Reporting Information [Line Items] | ||||
Net revenues | 165,275 | 157,511 | 488,117 | 492,189 |
Gross profit | 100,745 | 99,782 | 305,618 | 305,746 |
Systems and Services | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations | 44,975 | 44,436 | 132,600 | 140,834 |
Stock-based compensation | 366 | 240 | 950 | 690 |
Depreciation and amortization | $ 7,827 | $ 7,181 | $ 23,716 | $ 20,879 |
Segments and Geographical Inf_5
Segments and Geographical Information - Net Revenues by Geographic Area (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Segment Reporting Information [Line Items] | ||||
Net revenues | $ 960,214 | $ 890,348 | $ 2,905,534 | $ 2,833,120 |
U.S. | ||||
Segment Reporting Information [Line Items] | ||||
Net revenues | 421,272 | 400,045 | 1,262,008 | 1,251,018 |
Switzerland | ||||
Segment Reporting Information [Line Items] | ||||
Net revenues | 259,587 | 257,845 | 913,724 | 919,935 |
Other International | ||||
Segment Reporting Information [Line Items] | ||||
Net revenues | $ 279,355 | $ 232,458 | $ 729,802 | $ 662,167 |
Segments and Geographical Inf_6
Segments and Geographical Information - Long-Lived Assets by Geographic Area (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets | $ 1,387,354 | $ 1,350,735 |
Switzerland | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets | 567,230 | 532,921 |
U.S. | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets | 206,348 | 214,804 |
Other International | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets | $ 613,776 | $ 603,010 |
Restructuring and Other Charg_2
Restructuring and Other Charges (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | |
Restructuring and Related Activities [Abstract] | ||||
Restructuring expenses | $ 0.1 | $ 10.2 | ||
Unpaid restructuring charges | 0.3 | $ 3.9 | ||
Payments for restructuring | $ 0.3 | $ 3.7 |