Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 28, 2017 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | PI | ||
Entity Registrant Name | IMPINJ INC | ||
Entity Central Index Key | 1,114,995 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 20,564,294 | ||
Entity Public Float | $ 0 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 33,636 | $ 10,121 |
Short-term investments | 66,905 | |
Accounts receivable, net of allowances of $284 and $285, respectively | 17,447 | 12,889 |
Inventory | 27,734 | 11,837 |
Prepaid expenses and other current assets | 3,004 | 1,095 |
Total current assets | 148,726 | 35,942 |
Property and equipment, net of accumulated depreciation of $10,227 and $8,968, respectively | 14,929 | 12,351 |
Other non-current assets | 637 | |
Goodwill | 3,881 | 3,881 |
Other intangible assets, net | 37 | |
Total assets | 167,536 | 52,848 |
Current liabilities: | ||
Accounts payable | 7,166 | 3,182 |
Accrued compensation and employee related benefits | 7,647 | 4,038 |
Accrued liabilities | 6,098 | 2,895 |
Current portion of long-term debt | 2,589 | 5,227 |
Current portion of capital lease obligations | 1,130 | 1,190 |
Current portion of deferred rent | 306 | 258 |
Current portion of deferred revenue | 445 | 684 |
Total current liabilities | 25,381 | 17,474 |
Long-term debt, net of current portion | 9,676 | 10,683 |
Capital lease obligations, net of current portion | 1,698 | 2,526 |
Long-term liabilities—other | 770 | 678 |
Warrant liability | 2,865 | |
Deferred rent, net of current portion | 5,022 | 4,984 |
Deferred revenue, net of current portion | 966 | 710 |
Total liabilities | 43,513 | 39,920 |
Commitments and contingencies (Note 9) | ||
Total redeemable convertible preferred stock | 97,963 | |
Stockholders’ (deficit) equity: | ||
Preferred stock, $0.001 par value — 5,000 shares authorized; no shares issued and outstanding at December 31, 2016; no shares authorized, issued and outstanding at December 31, 2015 | ||
Common stock, $0.001 par value — 495,000 and 15,041 shares authorized; 20,336 and 4,382 shares issued and outstanding at December 31, 2016 and 2015, respectively | 20 | 4 |
Additional paid-in capital | 311,216 | 100,276 |
Accumulated other comprehensive income (loss) | (10) | |
Accumulated deficit | (187,203) | (185,315) |
Total stockholders’ equity (deficit) | 124,023 | (85,035) |
Total liabilities, redeemable convertible preferred stock and stockholders? (deficit) equity | $ 167,536 | 52,848 |
Series 1 | ||
Current liabilities: | ||
Total redeemable convertible preferred stock | 60,184 | |
Series 2 | ||
Current liabilities: | ||
Total redeemable convertible preferred stock | $ 37,779 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Accounts receivable, allowances | $ 284 | $ 285 |
Property and equipment, accumulated depreciation | $ 10,227 | $ 8,968 |
Redeemable convertible preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, par value | $ 0.001 | |
Preferred stock, shares authorized | 5,000,000 | 0 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 495,000,000 | 15,041,000 |
Common stock, shares issued | 20,336,000 | 4,382,000 |
Common stock, shares outstanding | 20,336,000 | 4,382,000 |
Series 1 | ||
Redeemable convertible preferred stock, shares authorized | 0 | 5,334,000 |
Redeemable convertible preferred stock, shares issued | 0 | 5,334,000 |
Redeemable convertible preferred stock, shares outstanding | 0 | 5,334,000 |
Series 2 | ||
Redeemable convertible preferred stock, shares authorized | 0 | 2,979,000 |
Redeemable convertible preferred stock, shares issued | 0 | 2,552,000 |
Redeemable convertible preferred stock, shares outstanding | 0 | 2,552,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue: | |||
Product revenue | $ 111,769 | $ 77,389 | $ 58,970 |
Development, service and licensing revenue | 518 | 1,090 | 4,793 |
Total revenue | 112,287 | 78,479 | 63,763 |
Cost of revenue: | |||
Cost of product revenue | 52,614 | 37,360 | 29,003 |
Cost of development, service and licensing revenue | 220 | 273 | 1,118 |
Total cost of revenue | 52,834 | 37,633 | 30,121 |
Gross profit | 59,453 | 40,846 | 33,642 |
Operating expenses: | |||
Research and development expense | 25,185 | 17,579 | 14,287 |
Sales and marketing expense | 22,330 | 14,579 | 10,825 |
General and administrative expense | 12,426 | 7,087 | 6,115 |
Offering costs | 1,959 | ||
Total operating expenses | 59,941 | 39,245 | 33,186 |
Income (loss) from operations | (488) | 1,601 | 456 |
Interest income (expense) and other income (expense), net: | |||
Interest expense | (1,633) | (1,208) | (901) |
Interest income and other income (expense), net | 616 | 673 | 838 |
Total interest income (expense) and other, net | (1,017) | (535) | (63) |
Income (loss) before tax expense | (1,505) | 1,066 | 393 |
Income tax expense | (168) | (166) | (96) |
Net income (loss) | (1,673) | 900 | 297 |
Less: Accretion of preferred stock | (6,258) | (11,301) | (11,301) |
Net loss attributable to common stockholders | $ (7,931) | $ (10,401) | $ (11,004) |
Net loss per share attributable to common stockholders — basic and diluted | $ (0.74) | $ (2.67) | $ (3.30) |
Weighted-average shares used to compute net loss per share attributable to common stockholders — basic and diluted | 10,778 | 3,893 | 3,338 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Net income (loss) | $ (1,673) | $ 900 | $ 297 |
Other comprehensive income (loss): | |||
Unrealized losses on investments | (10) | ||
Total other comprehensive income (loss) | (10) | ||
Comprehensive income (loss) | $ (1,683) | $ 900 | $ 297 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Redeemable Convertible Preferred Stock - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Beginning balance | $ 97,963 | $ 86,662 | $ 75,361 |
Accretion of redeemable convertible preferred stock | 6,258 | 11,301 | 11,301 |
Issuance of preferred stock upon exercise of preferred stock warrants | 1,863 | ||
Conversion of preferred stock into common stock at initial public offering | (106,084) | ||
Ending balance | 97,963 | 86,662 | |
Series 1 | |||
Beginning balance | $ 60,184 | $ 48,883 | $ 37,582 |
Beginning balance, shares | 5,334 | 5,334 | 5,334 |
Accretion of redeemable convertible preferred stock | $ 6,258 | $ 11,301 | $ 11,301 |
Conversion of preferred stock into common stock at initial public offering | $ (66,442) | ||
Conversion of preferred stock into common stock at initial public offering, shares | (5,334) | ||
Ending balance | $ 60,184 | $ 48,883 | |
Ending balance, shares | 0 | 5,334 | 5,334 |
Series 2 | |||
Beginning balance | $ 37,779 | $ 37,779 | $ 37,779 |
Beginning balance, shares | 2,552 | 2,552 | 2,552 |
Issuance of preferred stock upon exercise of preferred stock warrants | $ 1,863 | ||
Issuance of preferred stock upon exercise of preferred stock warrants, shares | 106 | ||
Conversion of preferred stock into common stock at initial public offering | $ (39,642) | ||
Conversion of preferred stock into common stock at initial public offering, shares | (2,658) | ||
Ending balance | $ 37,779 | $ 37,779 | |
Ending balance, shares | 0 | 2,552 | 2,552 |
Consolidated Statements of Cha7
Consolidated Statements of Changes in Stockholders' Equity (Deficit) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) |
Beginning balance at Dec. 31, 2013 | $ (67,028) | $ 3 | $ 119,481 | $ (186,512) | |
Beginning balance, shares at Dec. 31, 2013 | 3,224 | ||||
Common stock issued in connection with early stock option exercises, shares | 231 | ||||
Common stock issued in connection with all other stock option exercises | 332 | $ 1 | 331 | ||
Common stock issued in connection with all other stock option exercises, shares | 275 | ||||
Vesting of early exercised stock options | 54 | 54 | |||
Common stock repurchased, shares | (2) | ||||
Stock-based compensation | 1,175 | 1,175 | |||
Accretion of preferred stock | (11,301) | (11,301) | |||
Net income (loss) | 297 | 297 | |||
Ending balance at Dec. 31, 2014 | (76,471) | $ 4 | 109,740 | (186,215) | |
Ending balance, shares at Dec. 31, 2014 | 3,728 | ||||
Common stock issued in connection with early stock option exercises, shares | 2 | ||||
Common stock issued in connection with all other stock option exercises | 530 | 530 | |||
Common stock issued in connection with all other stock option exercises, shares | 654 | ||||
Vesting of early exercised stock options | 119 | 119 | |||
Common stock repurchased, shares | (2) | ||||
Stock-based compensation | 1,188 | 1,188 | |||
Accretion of preferred stock | (11,301) | (11,301) | |||
Net income (loss) | 900 | 900 | |||
Ending balance at Dec. 31, 2015 | (85,035) | $ 4 | 100,276 | (185,315) | |
Ending balance, shares at Dec. 31, 2015 | 4,382 | ||||
Common stock issued in connection with early stock option exercises, shares | 59 | ||||
Common stock issued in connection with all other stock option exercises | $ 286 | 286 | |||
Common stock issued in connection with all other stock option exercises, shares | 196 | 138 | |||
Vesting of early exercised stock options | $ 167 | 167 | |||
Stock-based compensation | 2,765 | 2,765 | |||
Accretion of preferred stock | (6,258) | (6,258) | |||
Conversion of Preferred Stock Warrants Into Common Stock Warrants Initial Public Offering | 505 | 505 | |||
Common Stock Issued in Connection with Net Exercises of Common Stock Warrants | 55 | ||||
Conversion of preferred stock into common stock at initial public offering | 106,084 | $ 9 | 106,075 | ||
Conversion of preferred stock into common stock at initial public offering, shares | 8,655 | ||||
Issuance of common stock from initial public offering, net of issuance costs | 107,192 | $ 7 | 107,185 | ||
Issuance of common stock from initial public offering, net of issuance costs, shares | 7,047 | ||||
Net cumulative effect adjustment upon adoption of share-based payment guidance to account for forfeitures as they occur | 215 | (215) | |||
Net income (loss) | (1,673) | (1,673) | |||
Other comprehensive income (loss) | (10) | $ (10) | |||
Ending balance at Dec. 31, 2016 | $ 124,023 | $ 20 | $ 311,216 | $ (187,203) | $ (10) |
Ending balance, shares at Dec. 31, 2016 | 20,336 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating activities: | |||
Net income (loss) | $ (1,673) | $ 900 | $ 297 |
Adjustment to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 2,869 | 1,972 | 1,366 |
Amortization and write-off of debt issuance costs | 239 | 152 | 182 |
Amortization of premium on short-term investments | 31 | ||
Revaluation of warrant liability | (559) | (703) | 398 |
Stock-based compensation | 2,765 | 1,178 | 1,175 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (4,515) | (3,327) | (3,611) |
Inventory | (15,897) | (2,783) | (799) |
Prepaid expenses and other assets | (1,759) | (360) | (159) |
Deferred revenue | 17 | (466) | (896) |
Deferred rent | 86 | 4,601 | (165) |
Accounts payable | 3,883 | 754 | 1,402 |
Accrued compensation and benefits | 3,462 | 1,356 | (817) |
Accrued liabilities | 1,554 | 182 | 795 |
Net cash provided by (used in) operating activities | (9,497) | 3,456 | (832) |
Investing activities: | |||
Purchases of investments | (67,103) | ||
Purchases of property and equipment | (3,530) | (7,450) | (1,017) |
Restricted cash | 200 | ||
Net cash used in investing activities | (70,633) | (7,450) | (817) |
Financing activities: | |||
Proceeds from public offerings, net of offering costs | 108,096 | ||
Payments on capital lease financing obligations | (1,229) | (824) | (625) |
Payments on term loans | (65,320) | (6,115) | (2,667) |
Proceeds from term loans | 61,436 | 13,899 | |
Proceeds from exercise of stock options | 600 | 538 | 702 |
Proceeds from exercise of warrants | 62 | ||
Payments of deferred offering costs | (322) | ||
Net cash provided by (used in) financing activities | 103,645 | 7,176 | (2,590) |
Net increase (decrease) in cash and cash equivalents | 23,515 | 3,182 | (4,239) |
Cash and cash equivalents: | |||
Beginning of period | 10,121 | 6,939 | 11,178 |
End of period | 33,636 | 10,121 | 6,939 |
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | 1,503 | 973 | 718 |
Cash paid for income taxes | 46 | 41 | 21 |
Supplemental disclosure of non-cash financing and investing activities: | |||
Accretion on preferred stock | 6,258 | 11,301 | 11,301 |
Vesting of early exercised stock options | 167 | 119 | 54 |
Additions to property and equipment through capital lease | 341 | 2,907 | 819 |
Accrued not yet paid offering costs | 626 | 315 | |
Purchases of property and equipment not yet paid | 1,538 | 347 | $ 381 |
Write-off of fully depreciated property and equipment | 1,571 | $ 1,913 | |
Conversion of convertible preferred stock to common stock | 106,084 | ||
Conversion of convertible preferred stock warrants to common stock warrants | $ 505 |
Description of Business
Description of Business | 12 Months Ended |
Dec. 31, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of Business | Note 1. Description of Business Impinj, Inc. enables wireless connectivity to everyday items, delivering each items’ unique identity, location and authenticity to business and consumer applications. The Impinj Platform, spanning endpoints, connectivity and software provides this wireless item connectivity and information delivery. Impinj derives revenue from selling endpoint integrated circuits that attach-to and uniquely identify items; reader ICs, readers and gateways that enable bidirectional radio connectivity to the items; operating-system software that manages platform resources and delivers services and item data to partner applications via open APIs; as well as from development, service and license agreements. Our integrated platform connects billions of everyday items such as apparel, medical supplies, automobile parts, drivers’ licenses, food, logistics and luggage to applications such as inventory management, patient safety, asset tracking and item authentication, delivering real-time information to businesses about items they create, manage, transport and sell. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies Accounting Principles We prepared the consolidated financial statements and accompanying notes in accordance with accounting principles generally accepted in the United States of America. Principles of Consolidation Our consolidated financial statements include the accounts of Impinj, Inc. and our wholly-owned subsidiaries Impinj RFID Technology (Shanghai) Co., Ltd., located in China, Impinj UK Ltd., located in United Kingdom, Impinj Japan LLC, located in Japan, and Impinj International, Ltd., located in the Cayman Islands. All intercompany transactions have been eliminated in consolidation. Public Offerings On July 26, 2016, we closed our initial public offering of 5,520,000 shares of common stock at an initial price to the public of $14.00 per share, including 720,000 shares of common stock pursuant to the underwriters’ option to purchase additional shares, resulting in aggregate net proceeds to us of $68.5 million after deducting underwriting discounts and commissions and offering costs. Upon the effectiveness of the registration statement related to the initial public offering on July 20, 2016, all of our outstanding shares of redeemable convertible preferred stock and outstanding preferred stock warrants, which automatically net exercised, converted into 8,531,146 shares and 123,759 shares, respectively, of common stock. The related carrying value of the redeemable convertible preferred stock and warrants of $106.1 million and $505,000, respectively, were reclassified to common stock and additional paid-in capital. On December 7, 2016, we closed our follow-on public offering of 1,527,380 shares of common stock at a price to the public of $27.00 per share, resulting in aggregate net proceeds to us of $38.7 million after deducting underwriting discounts and commissions and offering costs. Reverse Stock Split On June 16, 2016, our board of directors and stockholders approved an amendment to our certificate of incorporation to effect a reverse split of shares of our authorized, issued and outstanding common stock and redeemable convertible preferred stock at a 1-for-12 ratio. The reverse stock split was effected on July 8, 2016. The par value of our common stock and the par value of our redeemable convertible preferred stock were not adjusted as a result of the reverse stock split. All authorized, issued and outstanding shares of common stock and redeemable convertible preferred stock, warrants for common stock and redeemable convertible preferred stock, options to purchase common stock and the related per share amounts contained in these consolidated financial statements have been retroactively adjusted to reflect this reverse stock split for all periods presented. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, reserve for returns, collectability of accounts receivable, estimated costs to complete development contracts, warranty obligations, deferred revenue, inventory excess and obsolescence, depreciable lives of fixed assets, the determination of the fair value of stock awards and warrants and accrued liabilities, compensation and employee related benefits. To the extent there are material differences between these estimates, judgments, or assumptions and actual results, our financial statements will be affected. Risks and Uncertainties Inherent in our business are various risks and uncertainties, including that we are developing advanced technologies and new applications in a rapidly changing industry. These risks include the failure to develop and extend our products and the rejection of our products by consumers, as well as other risks and uncertainties. If we do not successfully implement our business plan, certain assets may not be recoverable, certain liabilities may not be paid and investments in our capital stock may not be recoverable. Our success depends upon the acceptance of our technology, development of sales and distribution channels and our ability to generate significant revenue from the use of our technology. Concentrations of Credit Risk Financial instruments , which potentially subject us to concentrations of credit risk, We place cash and cash equivalents and investments with major financial institutions, which management assesses to be of high credit quality, in order to limit exposure of our investments. The following table presents t YEAR ENDED DECEMBER 31, 2016 2015 2014 Revenue: Customer A 16 % 14 % 11 % Customer B 14 10 11 Customer C 11 9 14 Customer D 10 15 6 Customer E 9 16 12 60 % 64 % 54 % AS OF DECEMBER 31, 2016 2015 Accounts Receivable: Customer A 15 % 15 % Customer C 8 12 Customer D 11 20 Customer E 11 11 Customer F 18 — 63 % 58 % Concentration of Supplier Risk We outsource the manufacturing and production of our hardware products to a limited number of suppliers. Although there are a limited number of manufacturers for hardware products, we believe that other suppliers could provide similar products on comparable terms. A change in suppliers, however, could cause a delay in manufacturing and a possible loss of sales, which would adversely affect our operating results. Cash and Cash Equivalents Cash and cash equivalents consist of cash deposits. We deposit our cash and cash equivalents primarily with one major financial institution, and our balances consistently exceed federally insured limits. We have not experienced any losses on our cash and cash equivalents. We define cash and cash equivalents to be all highly liquid investments purchased with an original or remaining maturity of three months or less at the date of purchase. Investments Our investments consist of fixed income securities, which include U.S. government agency securities, corporate notes and bonds and commercial paper. As the investments are available to support current operations, our available-for-sale securities are classified as short-term investments. Available-for-sale securities are carried at fair value with unrealized gains and losses reported as a component of accumulated other comprehensive income (loss) in stockholders’ equity (deficit), while realized gains and losses and other-than-temporary impairments are reported as a component of net income (loss) based on specific identification. An impairment charge is recorded in the consolidated statements of operations for declines in fair value below the cost of an individual investment that are deemed to be other than temporary. We assess whether a decline in value is temporary based on the length of time that the fair market value has been below cost, the severity of the decline and the intent and ability to hold or sell the investment. We did not identify any investments as other-than-temporarily impaired as of December 31, 2016. We had no cash equivalents and available-for-sale investments as of December 31, 2015. The following table presents the amortized cost, gross unrealized gains and losses, and fair value of our cash, cash equivalents and available-for-sale investments as of December 31, 2016 (in thousands): December 31, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash $ 10,667 $ — $ — $ 10,667 Cash equivalents: Money market funds 14,065 — — 14,065 U.S. government agency securities 4,996 1 — 4,997 Corporate notes and bonds 959 — — 959 Commercial Paper 2,948 — — 2,948 Short-term investments: U.S. government agency securities 36,535 6 (10 ) 36,531 Corporate notes and bonds 19,259 2 (9 ) 19,252 Commercial Paper 11,122 — — 11,122 Total assets measured at fair $ 100,551 $ 9 $ (19 ) $ 100,541 T he contractual maturities are due in one year or less on our available-for-sale investments as of December 31, 2016. Accounts Receivable Accounts receivable consists of amounts billed currently due from customers and amounts earned not yet billed on development agreements, net of an allowance for doubtful accounts and an allowance for sales returns and price exceptions. The allowance for doubtful accounts is our best estimate of the amount of probable credit losses in existing accounts receivable and is determined based on historical write-off experience and on specific customer accounts believed to be a collection risk. Account balances are written off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. We record our sales returns and price exceptions allowance based on historical returns experience. The following table summarizes our allowance for doubtful accounts: BALANCE AT BEGINNING OF YEAR CHARGED TO COSTS AND EXPENSES WRITE- OFFS BALANCE AT END OF YEAR (in thousands) Allowance for doubtful accounts: During year ended December 31, 2016 $ 65 $ 42 $ — $ 107 During year ended December 31, 2015 50 15 — 65 During year ended December 31, 2014 58 (8 ) — 50 The following table summarizes our allowance for sales returns and price exceptions: BALANCE AT BEGINNING OF YEAR CHARGED TO COSTS AND EXPENSES WRITE- OFFS BALANCE AT END OF YEAR (in thousands) Allowance for sales returns and price exceptions: During year ended December 31, 2016 $ 220 $ 702 $ (745 ) $ 177 During year ended December 31, 2015 312 393 (485 ) 220 During year ended December 31, 2014 347 450 (485 ) 312 Inventory Inventories consist of a combination of raw materials, work-in-progress and finished goods and are stated at the lower of cost or market. Cost is determined using the average costing method, which approximates the first in, first out, or FIFO, method. We establish reserves for excess and obsolete inventory based on our analysis of inventory levels and future sales forecasts. The following table presents the detail of inventories as of the dates presented: DECEMBER 31, 2016 2015 (in thousands) Raw materials $ 5,482 $ 852 Work-in-process 5,556 3,269 Finished goods 16,696 7,716 Total Inventory $ 27,734 $ 11,837 Inventory write-downs are included in cost of revenue and were $420,000, $191,000 and $538,000 for 2016, 2015 and 2014, respectively. We sold inventory previously written-down of $162,000, $492,000 and $0 during 2016, 2015 and 2014, respectively. We specifically identify inventory to write down by considering various factors at each reporting date, including inventory age, forecasted demand, new product release schedules, market conditions and other related factors. In considering forecasted demand, we also evaluate the likelihood of market adoption and demand from end users based upon each product’s lifecycle stage, longevity and historical product sales trends. Estimating the value of our inventory requires considerable judgment. Changes in our judgment could have a material impact on our results of operations, financial position and cash flows. Long-Lived Assets and Intangible Assets Long-lived assets include property and equipment. We assess the carrying value of our long-lived assets and intangible assets with a definite life when indicators of impairment exist, and we recognize an impairment loss when the carrying amount of an asset is not recoverable from the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Impairment losses are measured by comparing the carrying amount of a long-lived asset to its fair value. Identifiable intangible assets comprise purchased customer lists, patents and developed technologies. Identifiable intangible assets are amortized over their estimated useful lives, ranging from four to eight years, using the straight-line method, which approximates the expected use of these assets. As of December 31, 2016, all definite-lived intangible assets were fully amortized. We record property and equipment at cost, determine depreciation using the straight-line method over the estimated useful lives of the assets, capitalize additions and improvements that increase the value or extend the life of an asset, expense ordinary repairs and maintenance as incurred, and amortize leasehold improvements over the shorter of the term of the lease or the estimated useful lives of the assets. Goodwill Goodwill represents the excess of the purchase price over the fair value of the net identified assets acquired in a business combination. We evaluate our goodwill for impairment annually on September 30 or when indicators for impairment exist, and we write down goodwill when impaired. To evaluate goodwill for impairment, we qualitatively assess whether it is more likely than not that the fair value of our sole reporting unit is less than the carrying amount. If so, we proceed to the first step of the goodwill impairment test in which we identify potential impairment by performing a quantitative assessment, comparing the fair value of the reporting unit to the potentially impaired value, and we proceed to step two of the impairment analysis in which we record an impairment loss equal to the excess. Indicators of impairment in our qualitative assessment would include: the impacts of significant adverse changes in legal factors; market and economic conditions; the result of our operational performance and strategic plans; adverse actions by regulators; unanticipated changes in competition and market share; and the potential for sale or disposal of all or a significant portion of our business. No triggering events occurred during 2016 and 2015. Revenue Recognition We generate revenue from sales of our hardware and software products, and from development and service agreements and licensing agreements. We recognize product revenue when: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the price is fixed or determinable; and (4) collection is probable. Hardware products are typically considered delivered upon shipment. Certain arrangements contain provisions for customer acceptance. Where we are unable to demonstrate that the customer acceptance provisions are met on shipment, revenue is deferred until all acceptance criteria have been met or the acceptance clause or contingency lapses. For the sale of products to a distributor, we evaluate our ability to estimate returns, considering a number of factors including, the geography in which a sales transaction originates, payment terms and our relationship and past history with the distributor. Distributor agreements do not generally provide for a right of return for refund but do typically provide for a right of return in exchange for other similar products, subject to time and quantity limitations. If we are not able to estimate returns at the time of sale to a distributor, revenue recognition is deferred until there is persuasive evidence indicating the product has sold-through to an end user. Persuasive evidence of sell-through may include reports from distributors documenting sell-through activity, data indicating an order has shipped to an end user or other similar information. At the time of revenue recognition, we record reserves for sales returns which are estimated based on historical activity and expectations of future experience. We monitor and analyze actual experience and adjust reserves on a quarterly basis. Our reader and gateway products are sold in combination with a limited hardware warranty against manufacturer defect. Our hardware warranty includes access to repair or replacement of hardware in the event of breakage or failure resulting directly from a manufacturer defect; this warranty is provided to all customers and considered an integral part of the initial product sale. Certain software is integrated with our reader and gateway products and is essential to the functionality of the integrated products. We also sell other software that configures, manages and controls readers and gateways which is not considered essential to the functionality of the hardware product. Our multi-element arrangements generally include a combination of hardware products, extended warranty, support and other non-essential software. We allocate revenue to software and non-software deliverables based on their relative fair value. Accounting principles establish a hierarchy to determine the selling price to be used for allocating revenue to non-software deliverables as follows: (1) vendor-specific objective evidence of selling price, or VSOE; (2) third-party evidence of selling price, or TPE; and (3) best estimated selling prices, or ESP. VSOE generally exists only when we sell the deliverable separately and is the price actually charged by us for that deliverable on a stand-alone basis. When VSOE cannot be established, we attempt to establish the selling price of each element based on TPE. TPE is determined based on competitor prices for similar deliverables when sold separately. We are unable to reliably determine what similar competitor products’ selling prices are on a stand-alone basis and are therefore typically not able to determine TPE. When we are unable to establish selling price using VSOE or TPE, we use ESP in the allocation of arrangement consideration. The objective of ESP is to determine the price at which we would transact a sale if the product or service were sold on a stand-alone basis. Our ESPs for all products and services are calculated using a method consistent with the way management prices new products. We consider multiple factors in developing the ESPs for our products including our historical pricing and discounting practices, the costs incurred to manufacture the product or deliver the service, the nature of the customer relationship and market trends. In addition, we may consider other factors as appropriate, including the pricing of competitive alternatives if they exist and product-specific business objectives. We regularly review VSOE and ESP and maintain internal controls over the establishment and updates of these estimates. For software deliverables, we recognize revenue in accordance with industry specific software accounting guidance for stand-alone software licenses and related support services. Revenue from software deliverables that do not require significant production, modification or customization of our software is generally recognized when: (1) delivery has occurred; (2) there is no customer acceptance clause in the contract; (3) there are no significant post-delivery obligations remaining; (4) the price is fixed; and (5) collection of the resulting receivable is reasonably assured. For transactions where we have established VSOE for the fair value of support services as measured by the renewal prices paid by our customers when the services are sold separately on a stand-alone basis, we use the residual method to determine the amount of software product revenue to be recognized. Under the residual method, the fair value of the undelivered elements is deferred and the remaining portion of the sales amount is recognized as license revenue. Support services revenue is deferred and recognized ratably over the period during which the services are to be performed, which is typically from one to three years. In those instances where we have not established VSOE of our support services, the license and service revenue is recognized on a straight-line basis over the support period. Amounts allocated to extended support services sold with our reader products are deferred and recognized on a straight-line basis over the support services term. We account for nonrecurring engineering development agreements that involve significant production, modification or customization of our products by generally recognizing the revenue over the performance period using the percentage of completion, or POC, method. Advance payments under these agreements are deferred and recognized as earned. Under the POC method of accounting, sales and gross profit are recognized as work is performed based on the relationship between actual costs incurred and total estimated costs to complete the contract. Changes to the original estimates may be required during the life of the contract. Estimates are reviewed quarterly and the effect of any change in the estimated profitability for a contract is reflected in cost of sales. The use of the POC method of accounting involves considerable reliance on estimates in determining revenue, costs and profits and in assigning the amounts to accounting periods. We account for licensing and service agreements that do not involve significant production, modification or customization of our products generally by recognizing the revenue ratably over the performance period; advance payments under these agreements are initially deferred. We present revenue net of sales tax in our consolidated statements of operations. Shipping charges billed to customers are included in product revenue and the related shipping costs are included in cost of product revenue. Guarantees and Product Warranties In the normal course of business to facilitate sales of our products, we indemnify other parties, including customers, distributors, resellers and parties to other transactions with us, with respect to certain matters. We have agreed to hold the other party harmless against losses arising from a breach of representations or covenants, from intellectual property infringement and from other claims made against certain parties. These agreements may limit the time within which an indemnification claim can be made and the amount of the claim. It is not possible to determine the maximum potential amount under these indemnification agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. We provide limited warranty coverage for most products, generally ranging from a period of 90 days to one year from the date of shipment. A liability is recorded for the estimated cost of product warranties based on historical claims, product failure rates and other factors when the related revenue is recognized. We review these estimates periodically and adjust the warranty reserves as actual experience differs from historical estimates or other information becomes available. The warranty liability primarily includes the anticipated cost of materials, labor and shipping necessary to repair or replace the product. Accrued warranty costs in 2016 and 2015 were not material. Research and Development Costs Research and development costs are expensed as incurred and consist of salaries and related benefits of product development personnel, contract developers, prototype materials and other expenses related to the development of new and improved products. Foreign Currency The functional currency for all of our subsidiaries is the U.S. dollar. All foreign currency transactions are initially measured and recorded in U.S. dollars using the exchange rate on the date of the transaction. Foreign currency denominated assets and liabilities are remeasured at the end of each reporting period using the exchange rate at that date. We record translation gains and losses in other income (expense), net on the consolidated statements of operations. Income Taxes We use the liability method of accounting for income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to be in effect when such assets and liabilities are recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the year that includes the enactment date. We determine deferred tax assets, including historical net operating losses, and deferred tax liabilities, based on temporary differences between the book and tax bases of assets and liabilities. We believe that it is currently more likely than not that our deferred tax assets will not be realized and as such, we have recorded a full valuation allowance for these assets. We utilize a two-step approach for evaluating uncertain tax positions. First, we evaluate recognition, which requires us to determine if the weight of available evidence indicates that a tax position is more likely than not to be sustained upon audit, including resolution of related appeals or litigation processes, if any. If a tax position is not considered more likely than not to be sustained, no benefits of the position are recognized. Second, we measure the uncertain tax position, which is based on the largest amount of benefit which is more likely than not to be realized on effective settlement. This process involves estimating our actual current tax exposure, including assessing the risks associated with tax audits, together with assessing temporary differences resulting from the different treatment of items for tax and financial reporting purposes. If actual results differ from our estimates, our net operating loss and credit carryforwards could be materially impacted. Stock-Based Compensation We have stock-based compensation plans that are more fully described in Note 8. We account for stock-based compensation at fair value. Stock-based compensation costs are recognized based on their grant date fair value estimated using the Black-Scholes model. In valuing our options, we make assumptions about weighted-average expected lives, risk-free interest rates, volatility and dividend yields and estimate the weighted-average expected life of the options as the average of the vesting option schedule and the term of the award, since we do not have sufficient historical exercise data as a public company to provide a reasonable basis upon which to estimate expected term. The term of the award is estimated using the simplified method, as awards are plain vanilla stock options. As we do not have an extensive public trading history for shares of our common stock, is estimated using a combination of the published historical volatilities our historical volatility since becoming a publicly traded company We account for equity instruments issued to nonemployees at fair value. We value all transactions in which we receive services for the issuance of equity instruments using the fair value of the services received or by using the Black-Scholes model. The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counterparty’s performance is complete or the date on which it is probable that performance will occur. Stock-based compensation expense on options granted to nonemployees was not material for 2016 and 2015. Warrant Liability We account for warrant liabilities at fair value. Warrant liability costs are recognized based on their grant date fair value estimated using the Black-Scholes option pricing model. To date, all warrants have been issued in connection with entering into or refinancing of our credit facilities and the costs of the warrants were accounted for as a debt discount which is amortized and recognized in interest expense over the term of the associated credit facility. Warrants issued to purchase preferred stock were adjusted to fair value at each period end as estimated using the Black-Scholes model and the associated change in fair value is included in other income (expense), net on the consolidated statements of operations. Net Loss per Share Attributable to Common Stockholders Net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding. We have outstanding stock options, unvested common stock subject to repurchase, warrants and convertible preferred stock, which are included in the calculation of diluted net loss attributable to common stockholders per share whenever to do so would be dilutive. We calculate basic and diluted net loss per share attributable to common stockholders in conformity with the two-class method required for companies with participating securities. We consider all series of convertible preferred stock to be participating securities. Under the two-class method, the net loss attributable to common stockholders is not allocated to the convertible preferred stock as the holders of convertible preferred stock do not have a contractual obligation to share in losses. The diluted net loss per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of this calculation, convertible preferred stock, options to purchase common stock and warrants to purchase common stock and convertible preferred stock are considered potentially dilutive securities but have been excluded from the calculation of diluted net loss per share attributable to common stockholders as their effect is antidilutive. Basic and diluted net loss per share was the same for each period presented, as the inclusion of all potential common shares outstanding would have been antidilutive. For the periods presented, the following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income (loss) per share attributable to common stockholders : FOR THE YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands, except per share amounts) Numerator: Net income (loss) $ (1,673 ) $ 900 $ 297 Less: Accretion of preferred stock (6,258 ) (11,301 ) (11,301 ) Net loss attributable to common stockholders—basic and diluted $ (7,931 ) $ (10,401 ) $ (11,004 ) Denominator: Weighted-average common shares outstanding 10,904 4,067 3,489 Weighted-average unvested shares of common stock subject to repurchase (126 ) (174 ) (151 ) Weighted-average shares used to compute net loss per share attributable to common stockholders—basic and diluted 10,778 3,893 3,338 Net loss per share attributable to common stockholders—basic and diluted $ (0.74 ) $ (2.67 ) $ (3.30 ) The following outstanding options, warrants and shares of preferred stock were excluded from the computation of diluted net loss per share attributable to common stockholders for the periods presented because their effect would have been antidilutive: FOR THE YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands) Redeemable convertible preferred stock — 7,885 7,885 Common stock warrants — 25 25 Redeemable convertible preferred stock warrants — 264 264 Unvested shares of common stock subject to repurchase 118 136 216 Stock options 2,310 1,896 2,007 Offering Costs Offering costs, consisting of legal, accounting and other fees and costs related to our public offerings, were capitalized. Total offering costs of approximately $4.1 million were deferred through the completion of the public offerings and upon closing of each of the public offerings in 2016 were reclassified to additional paid-in capital as a reduction of the proceeds. Recently Issued Accounting Standards In January 2017, the Financial Accounting Standards Board issued guidance simplifying the test for goodwill impairment. This standard eliminates Step 2 from the goodwill impairment test, instead requiring an entity to recognize a goodwill impairment charge for the amount by which the goodwill carrying amount exceeds the reporting unit’s fair value. This guidance is effective for interim and annual goodwill impairment tests in fiscal years beginning after December 15, 2019, and early adoption is permitted. This guidance must be applied on a prospective basis. We expect to adopt this guidance for interim and annual goodwill impairment tests performed on testing dates after January 1, 2017. We do not expect the adoption of this guidance to have a material impact on our financial position, results of operations or cash flows. In December 2016, the FASB issued amendments to address various technical corrections and improvements. Most of the amendments are effective upon issuance, while six of the amendments require transition guidance. The amendments applicable to our business have been adopted for the year ended December 31, 2016. The adoption of these amendments did not have a material impact on our financial position, results of operations or cash flows. In December 2016, the FASB issued guidance to narrow the definition of a business. This stan |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note Fair Value Measurement Accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The standards also establish a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Assets and liabilities valued based on observable market data for similar instruments, such as quoted prices for similar assets or liabilities. • Level 3 — Unobservable inputs that are supported by little or no market activity; instruments valued based on the best available data, some of which is internally developed, and considers risk premiums that a market participant would require. Our assessment of the significance of a particular input to the fair value measurement requires management to make judgments and consider factors specific to the asset or liability. We applied the following methods and assumptions in estimating our fair value measurements: Cash Equivalents — Cash equivalents are comprised of highly liquid investments, including money market funds and certificates of deposit, with original maturities of less than three months. The fair value measurement of these assets is based on quoted market prices in active markets and these assets are recorded at fair value. Investments — Our investments consist of fixed income securities, which include U.S. government agency securities, corporate notes and bonds and commercial paper. The fair value measurement of these assets is based on observable market-based inputs or inputs that are derived principally from or corroborated by observable market data by correlation or other means. Long-term Debt — The fair values of our long-term debt approximates carrying value based on the borrowing rates currently available to us for loans with similar terms using level 2 inputs. Convertible Preferred Stock Warrants — Our convertible preferred stock contained redemption provisions and therefore our warrants issued to purchase such Series 2 redeemable convertible preferred stock were classified as liabilities and recorded at fair value. These preferred stock warrants were subject to remeasurement at each consolidated balance sheet date and any change in fair value was recognized as a component of other income (expense), net. Upon the effectiveness of the registration statement related to the initial public offering on July 20, 2016, all of our outstanding warrants automatically converted into shares of common stock. At conversion in July 2016, we performed a fair value assessment of the preferred stock warrant liabilities using the Black-Scholes model and the following were the variable input assumptions: Series 2 redeemable convertible preferred stock fair market value of $17.50, Series 2 redeemable convertible preferred stock exercise price of $9.318 per share, remaining contractual lives of the warrants ranging from one to six years, volatility of 50% and risk-free interest rates ranging from 0.5% to 1.3%. Our Series 2 redeemable convertible preferred stock warrant liabilities were categorized as Level 3 because they were valued based on unobservable inputs and our judgment due to the absence of quoted market prices, inherent lack of liquidity and the long-term nature of such financial instruments. At December 31, 2015, we performed a fair value assessment of the preferred stock warrant liabilities using the Black-Scholes model and the following were the variable input assumptions: Series 2 redeemable convertible preferred stock fair market value of $19.20, Series 2 redeemable convertible preferred stock exercise price of $9.318 per share, remaining contractual lives of the warrants ranging from one to seven years, volatility of 50% and risk-free interest rates ranging from 0.6% to 2.1%. The assumptions used in the Black-Scholes model are inherently subjective and involve significant judgment. Any change in fair value is recognized as a component of other income (expense). The following tables present the balances of assets measured at fair value on a recurring basis, by level within the fair value hierarchy, as of December 31, 2016, all such balances as of December 31, 2015 were $0: DECEMBER 31, 2016 LEVEL 1 LEVEL 2 LEVEL 3 (in thousands) Cash equivalents: Money market funds $ 14,065 $ — $ — U.S. government agency securities — 4,997 — Corporate notes and bonds — 959 — Commercial Paper — 2,948 — Short-term investments: U.S. government agency securities — 36,531 — Corporate notes and bonds — 19,252 — Commercial Paper — 11,122 — Total assets measured at fair $ 14,065 $ 75,809 $ — The following table presents the balances of liabilities measured at fair value on a recurring basis, by level within the fair value hierarchy, as of December 31, 2015, all such balances as of December 31, 2016 were $0: DECEMBER 31, 2015 LEVEL 1 LEVEL 2 LEVEL 3 (in thousands) Convertible preferred stock warrants $ — $ — $ 2,865 Total liabilities measured at fair value $ — $ — $ 2,865 The following table provides a roll-forward of the fair value of the preferred stock warrant liabilities categorized as Level 3 for the years ended December 31, 2016 and 2015 (in thousands): Balance at December 31, 2013 $ 3,170 Remeasurement of convertible preferred stock warrants 398 Balance at December 31, 2014 $ 3,568 Remeasurement of convertible preferred stock warrants (703 ) Balance at December 31, 2015 2,865 Remeasurement of convertible preferred stock warrants (559 ) Exercise of preferred stock warrants (1,801 ) Conversion of preferred stock warrants into common stock warrants at initial public offering (505 ) Balance at December 31, 2016 $ — |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | Note 4. Property and Equipment The following table presents the detail of p roperty and equipment as of the dates presented: USEFUL DECEMBER 31, LIVES 2016 2015 (Years) (in thousands) Laboratory equipment 3 $ 6,687 $ 4,670 Computer equipment and software 3 2,529 2,703 Furniture and fixtures 3-7 228 193 Equipment acquired under capital leases 3-5 6,172 6,165 Leasehold improvements Shorter of lease term or economic 9,540 7,588 25,156 21,319 Less: Accumulated depreciation (10,227 ) (8,968 ) $ 14,929 $ 12,351 Depreciation expense, which includes amortization of leased assets, was $2.9 million, $1.9 million and $1.3 million for the years ended December 31, 2016, 2015 and 2014, respectively. The net book value of property and equipment acquired under capital leases was $2.7 million and $3.5 million at December 31, 2016 and 2015, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 5. Income Taxes We are subject to income taxes in the U.S. (federal and state) and foreign jurisdictions. In 2016, 2015 and 2014, we recorded tax provisions of $168,000, $166,000 and $96,000, respectively, driven by the amortization of tax goodwill that is not available to be offset by the valuation allowance and income tax expense related to foreign operations. Deferred federal, state and foreign income taxes reflect the net tax impact of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and such amounts for tax purposes. The following table presents the detail of income tax expense as of the periods presented: YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands) Current: US - Federal $ — $ — $ — US - State (15 ) (56 ) — Foreign (63 ) (22 ) (5 ) (78 ) (78 ) (5 ) Deferred: US - Federal (91 ) (88 ) (91 ) US - State 1 — — Foreign — — — (90 ) (88 ) (91 ) Total income tax expense $ (168 ) $ (166 ) $ (96 ) We have not provided for U.S. income taxes and foreign withholding taxes on the undistributed earnings of foreign subsidiaries of $371,000 as of December 31, 2016 as we intend to permanently reinvest such earnings outside the U.S. If these earnings were to be repatriated in the future, the related U.S. tax liability may be reduced by any foreign taxes previously paid on these earnings. The amount of unrecognized deferred tax liability related to these temporary differences is estimated to be approximately $74,000. The following table presents a reconciliation of the federal statutory rate and our effective tax rate for the periods presented: YEAR ENDED DECEMBER 31, 2016 2015 2014 U.S. Statutory Rate 34.0 % 34.0 % 34.0 % Change in valuation allowance (11.8 ) 9.9 8.9 State taxes (net of federal benefit) (4.4 ) 3.8 (33.6 ) Federal research and development credit 67.4 (60.8 ) (136.0 ) Incentive stock options (46.2 ) 19.5 83.6 Unrecognized tax benefits (47.1 ) 28.8 34.0 Preferred stock warrant revaluation 12.6 (22.4 ) 34.4 Other, net (15.5 ) 2.9 (1.0 ) Effective income tax rate (11.0) % 15.7 % 24.3 % The effective tax rate decreased from prior year solely due to the fluctuation in pre-tax book income. Similar to prior years, we continue to be in a full valuation allowance in the US but recognize deferred income tax expense in the US solely based on the amortization of goodwill intangibles. We also record current tax expense for certain state margin taxes that are based on income and on earnings in foreign jurisdictions. The following table presents the significant components of our deferred tax assets and liabilities as of the dates presented: DECEMBER 31, 2016 2015 (in thousands) Net operating loss carryforwards (1) (2) $ 34,287 $ 33,783 Credit carryforwards (2) 6,492 5,693 Depreciation and amortization — 594 Capitalized research and development 6,992 8,164 Deferred rent 1,825 223 Allowances 767 261 Deferred compensation 1,209 760 Deferred revenue 331 253 Stock compensation (1) 220 323 Deferred tax assets 52,123 50,054 Less: Valuation Allowance (50,959 ) (50,054 ) Net deferred tax assets $ 1,164 $ — Deferred Tax Liability: Goodwill (766 ) (676 ) Depreciation and Amortization (1,164 ) — Deferred tax liabilities (1,930 ) (676 ) Net deferred tax liability $ (766 ) $ (676 ) ____________ (1) (2) Realization of deferred tax assets is dependent upon the generation of future taxable income, if any, the timing and amount of which are uncertain. We have provided a full valuation allowance against the net deferred tax assets as of December 31, 2016 and 2015 because, based on the weight of available evidence, it is more likely than not (a likelihood of more than 50%) that some or all of the deferred tax assets will not be realized. The valuation allowance increased by $905,000 and $106,000, respectively, during the years ended December 31, 2016 and 2015. We have accumulated federal tax losses of approximately $100.0 million and $97.0 million, respectively, as of December 31, 2016 and 2015, which are available to reduce future taxable income. We have accumulated state tax losses of approximately $779,000 and $794,000 (tax effected), respectively, as of December 31, 2016 and 2015. We did not record a tax benefit related to our stock options during the years ended December 31, 2016 and 2015 due to the full valuation allowance for our deferred tax assets. However, due to the adoption of ASU 2016-09, we recorded an increase to the federal net operating loss of $727,000 and a corresponding increase in the valuation allowance. Additionally, we have net research and development credit carryforwards of $8.5 million and $7.5 million, respectively, as of December 31, 2016 and 2015, which are available to reduce future tax liabilities. The tax loss and research and development credit carryforwards begin to expire in 2023. Under Sections 382 and 383 of the Internal Revenue Code, if a corporation undergoes an ownership change, the corporation’s ability to use its pre-change net operating loss carryforwards and other pre-change tax attributes, such as research tax credits, to offset its post-change income or income tax liability may be limited. We are currently not under audit in any tax jurisdiction. Tax years from 2000 through 2016 are currently open for audit by federal and state taxing authorities. We establish reserves for tax positions based on estimates of whether, and the extent to which, additional taxes will be due. The reserves are established when we believe that positions might be challenged by taxing authorities despite our belief that our tax return positions are fully supportable. The following table presents the total balance of unrecognized tax benefits as of the dates presented: YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands) Unrecognized tax benefits at beginning of the period $ 1,878 $ 1,732 $ 1,599 Gross increases to tax positions in prior periods 210 — — Gross increases to tax positions in current periods 509 146 133 Unrecognized tax benefits at end of the period $ 2,597 $ 1,878 $ 1,732 At December 31, 2016, the total amount of unrecognized tax benefits of $2.6 million is recorded as a reduction to the deferred tax asset. We do not anticipate that the amount of existing unrecognized tax benefits will significantly increase or decrease within the next 12 months. Accrued interest and penalties related to unrecognized tax benefits are recorded as income tax expense and are zero. |
Debt Facilities
Debt Facilities | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt Facilities | Note 6. Debt Facilities Senior Credit Facility We have a loan and security agreement, which we refer to as our senior credit facility, with Silicon Valley Bank. The senior credit facility provides for (1) a $10.5 million aggregate principal amount of outstanding term borrowings, (2) revolver borrowings up to the lesser of $15.0 million and a borrowing base tied to the amount of our eligible accounts receivable and inventory, (3) a $5.0 million sublimit under the revolver for the issuance of standby letters of credit and (4) a $2.0 million equipment term-loan facility. In connection with the amendment of our senior credit facility in May 2016, we incurred $10.5 million in term borrowings and used such borrowings to refinance $8.2 million in outstanding term borrowings. As amended, interest on term borrowings accrues at a floating rate equal to the lender’s prime rate plus 2.25% during a one year interest-only period and at a floating rate equal to the lender’s prime rate plus 1.75% after expiration of the interest-only period (6.0% at December 31, 2016). Beginning in June 2017, we must begin paying 36 equal monthly installments of principal, plus accrued and unpaid interest. All outstanding principal and accrued and unpaid interest on the term borrowings is due and payable in May 2020. We may at our option prepay the outstanding term loan balance by paying the lender all principal and accrued and unpaid interest, plus a prepayment fee equal to $210,000 if the term-loan is prepaid on or prior to the first anniversary of the May 2016 amendment, and $105,000 if the term loan is prepaid after the first anniversary but on or prior to the second anniversary of the May 2016 amendment. At December 31, 2016, we had $10.5 million of term loan borrowings outstanding. Interest on revolver borrowings is payable monthly and accrues at a floating rate equal to the lender’s prime rate plus 2.25% at all times when our cash held at the bank plus the amount available to borrow on the revolver is less than or equal to $8.5 million, and 1.75% when our cash held at the bank plus the amount available to borrow on the revolver is greater than $8.5 million for a period of at least 60 consecutive days (5.5% at December 31, 2016). The maturity date of the revolver is December 2017. At December 31, 2016, we had no revolver borrowings outstanding. As amended in May 2016, our senior credit facility also provides for up to $2.0 million in equipment term loans to fund purchases of eligible equipment. Equipment loans are available for borrowing for one year following the May 2016 amendment date and mature in May 2020. Equipment loans are repaid in 36 equal monthly installments of principal, plus accrued and unpaid interest, following each borrowing and accrue interest at a floating rate equal to the lender’s prime rate plus 1.75% (5.5% at December 31, 2016). We may at our option prepay the outstanding equipment loan balance by paying the lender all outstanding principal and accrued and unpaid interest plus a prepayment fee equal to 2.00% of the principal amount of each equipment loan prepaid if such equipment loan is prepaid on or prior to the first anniversary of the date such equipment loan was borrowed, and 1.00% of the principal amount of each equipment loan prepaid if such equipment loan is prepaid after the first anniversary of the date such equipment loan was borrowed. At December 31, 2016, we had $1.9 million equipment loan borrowings outstanding. At December 31, 2016, $12.4 million of term loan, revolver and equipment loan borrowings were outstanding, excluding unamortized debt issuance costs of $149,000. The weighted average interest rate on these facilities was 5.9% at December 31, 2016. The following table presents the scheduled principal maturities as of December 31, 2016 (in thousands): 2017 $ 2,678 2018 4,169 2019 4,109 2020 1,458 $ 12,414 The senior credit facility contains customary conditions to borrowing, events of default and covenants, including covenants that restrict our ability to dispose of assets, merge with or acquire other entities, incur indebtedness, incur encumbrances, make distributions to holders of our capital stock, make investments or engage in transactions with our affiliates. The credit facility also requires us to maintain a minimum tangible net worth and liquidity ratio. We were in compliance with all covenants under our senior credit facility as of December 31, 2016 and December 31, 2015. Substantially all of our assets other than intellectual property are pledged as collateral under the senior credit facility. Mezzanine Credit Facility We had a mezzanine loan and security agreement, which we referred to as our mezzanine credit facility, with SG Enterprises II, LLC, which provided for a $5.0 million term loan which was drawn in September 2015. Interest on the term loan accrued at a fixed per-year rate equal to 18.0% and was payable monthly. On July 26, 2016, we repaid without premium or penalty the principal and accrued interest on the $5.0 million term loan pursuant to the mezzanine credit facility and wrote-off unamortized debt discounts and issuance costs of $109,000. |
Redeemable Convertible Preferre
Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) | 12 Months Ended |
Dec. 31, 2016 | |
Statement Of Stockholders Equity [Abstract] | |
Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) | Note 7. Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) Upon the effectiveness of the registration statement related to the initial public offering on July 20, 2016, all of our previously outstanding shares of redeemable convertible preferred stock automatically converted into 8,531,146 of common stock at the conversion rate of 1- to-1 and shares of Series 2 redeemable convertible preferred stock automatically converted into common stock at the conversion ratio of 1-to-1.25. The related carrying value of the of $106.1 million was reclassified to common stock and additional paid-in capital. Our previously outstanding Series 1 and Series 2 preferred stock included certain redemption provisions which prevented us from including these amounts in stockholders’ equity (deficit). Holders of our Series 1 and Series 2 redeemable convertible preferred stock were entitled to accretion equal to 7% annual interest (non-compounded) on the original price paid per share of the applicable series of preferred stock. We recorded accretion of $6.3 million and $11.3 million during 2016 and 2015, respectively, in respect of our outstanding Series 1 and Series 2 redeemable convertible preferred stock. Accretion is generally recorded against distributable earnings. Since we have accumulated losses, we record accretion against additional paid-in capital until there is no remaining capital. Thereafter, accretion is recorded against our accumulated deficit. Common Stock As of December 31, 2016, we had authorized 495,000,000 shares of voting $0.001 par value common stock. Each holder of the common stock is entitled to one vote per common share. At its discretion, the Board of Directors may declare dividends on shares of common stock, subject to the prior rights of our preferred stockholders. Upon liquidation or dissolution, holders of common stock will receive distributions only after preferred stock preferences have been satisfied. As of December 31, 2015, 25,000 common stock warrants were outstanding with an exercise price of $2.52 per share. These common stock warrants were exercised in July 2016. Preferred Stock Warrants The following table presents the preferred stock warrants outstanding, all with exercise prices of $9.318 per share, as of December 31, 2015, all such balances as of December 31, 2016 were $0: ISSUANCE FAIR VALUE AT DECEMBER 31 DATE SHARES 2015 (in thousands) Series 2 preferred stock (1) June 2, 2010 2,004 $ 24 Series 2 preferred stock (1) February 1, 2011 1,458 18 Series 2 preferred stock (1) July 13, 2012 41,666 548 Series 2 preferred stock (2) June 30, 2010 218,523 2,275 Total Series 2 redeemable convertible preferred stock 263,651 $ 2,865 (1) These warrants exercised on a net exercise basis in July 2016. (2) These warrants either were exercised prior to our initial public offering or automatically exercised on a net exercise basis as the per share price of common stock sold to the public in our initial public offering exceeded the exercise price of the warrants. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | Note 8. Stock-Based Compensation 2016 Equity Incentive Plan In June 2016, our board of directors adopted and our stockholders approved the 2016 Equity Incentive Plan, or the 2016 Plan, which became effective in July 2016 at which time the 2010 Equity Incentive Plan, or the 2010 Plan, was terminated. Our 2000 Stock Plan was terminated in March 2010. Shares of common stock reserved for issuance under the 2016 Plan consist of (a) 1,096,234 shares of common stock initially available for grants under the 2016 Plan, plus (b) 674,790 shares of common stock previously reserved but unissued and not subject to outstanding awards under the 2010 Plan that are now available for issuance under the 2016 Plan. The number of shares of common stock reserved for issuance under the 2016 Plan may increase on January 1 of each year, beginning on January 1, 2017 and ending on and including January 1, 2026, by the lesser of (1) 1,825,000; (2) 5% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year; or (3) a lesser number of shares determined by our board of directors. All options granted under the 2000 Stock Plan, the 2010 Plan and the 2016 Plan have a maximum 10-year term and generally vest and become exercisable over four years of continued employment or service as defined in each option agreement. We generally grant stock options with exercise prices that equal the fair value of the common stock on the date of grant. As of December 31, 2016, we have reserved 3,536,156 shares of common stock for issuance under our stock option plans. Prior to the adoption of our 2016 Equity Incentive Plan, we provided employees with the opportunity to early exercise stock options subject to the original vesting schedule of the option. In the event of voluntary or involuntary termination of employment with us, we have an irrevocable and exclusive option to repurchase the unvested portion of the shares at the original exercise price after the termination of employment. We account for cash received in consideration for the purchase of unvested shares of common stock or the early exercise of unvested stock options as a current liability and include it in accrued compensation and employee related benefits on the consolidated balance sheet. We repurchased 0 and 2,020 unvested shares from terminated employees in 2016 and 2015, respectively. The following table summarizes activity of unvested shares of our common stock for the year ended December 31, 2016: SHARES OUTSTANDING NUMBER OF SHARES WEIGHTED- AVERAGE EXERCISE PRICE PER SHARE (in thousands, except per share amounts) Outstanding at January 1, 2016 136 $ 1.76 Issued 59 5.35 Vested (77 ) 2.15 Outstanding at December 31, 2016 118 $ 3.30 The following table summarizes option award activity for the year ended December 31, 2016: WEIGHTED- WEIGHTED- NUMBER OF AVERAGE AVERAGE SHARES EXERCISE REMAINING TOTAL UNDERLYING PRICE PER CONTRACTUAL INTRINSIC OPTIONS SHARE LIFE (YEARS) VALUE (in thousands, except per share amounts) Outstanding at January 1, 2016 1,896 $ 3.72 7.77 $ 8,666 Granted 707 20.59 Exercised (196 ) 3.05 Forfeited or cancelled (97 ) 6.28 Outstanding at December 31, 2016 2,310 8.84 7.68 61,203 Vested and exercisable December 31, 2016 1,067 $ 2.69 6.15 $ 34,831 We estimate the weighted-average fair value of options granted during 2016, 2015 and 2014, some with exercise prices less than the estimated per share value of our common stock for financial reporting purposes on the grant date, was $9.60, $3.12 and $4.08 per share, respectively. The total intrinsic value of options exercised during 2016, 2015 and 2014 was $1.1 million, $3.8 million and $1.9 million, respectively. As of December 31, 2016, our total unrecognized stock-based compensation cost related to stock options was $8.6 million, which will be recognized over the weighted-average remaining requisite service period of 2.9 years. Employee Stock Purchase Plan In 2016, we adopted the 2016 Employee Stock Purchas e Plan, the ESPP, which became effective in July 2016. Under the ESPP, eligible employees can authorize payroll deductions for amounts up to 15% of their eligible compensation. A participant may purchase a maximum of 4,000 shares each six-month period or some lesser number of shares as determined by IRS rules. The offering periods generally start on the first trading day on or after February 20 and August 20 of each year, except for the first offering period, which commenced on July 21, 2016 and will end on the first trading day on or after February 20, 2017. Participants in an offering period will be granted the right to purchase common shares at a price per share that is 85% of the least of the fair market value of the shares at (1) the first day of the offering period and (2) the end of each purchase period within the offering period. The fair value of the ESPP options granted is determined using a Black-Scholes model and is amortized on a straight-line basis. The initial number of shares of common stock that may As of December 31, 2016, the total unrecognized stock-based compensation related to the ESPP was $335,000 and will be recognized on a straight-line basis over the weight-average remaining service period of 0.1 years . Black-Scholes Option Pricing Model In determining the fair value of stock awards granted, the following weighted-average assumptions were used in the Black-Scholes option pricing model for awards granted in the periods indicated: EMPLOYEE STOCK PURCHASE PLAN STOCK OPTIONS YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31, 2016 2016 2015 2014 Risk-free interest rates 0.4% 1.1% – 1.4% 1.2% – 1.6% 1.8% – 2.0% Expected term 0.5 years 4.3 – 6.1 years 4.3 – 6.0 years 6.0 years Expected dividends yield None None None None Volatility 61.8% 40.8% – 49.5% 41.5% – 43.4% 43.8% – 46.9% We determined that it was not practicable to calculate the volatility of our share price since we do not have an extensive public trading history for shares of our common stock a combination our historical volatility since becoming a publicly traded company and historical volatility since becoming a publicly traded company and Stock-Based Compensation Expense The following table presents the detail of stock-based compensation expense amounts included in our consolidated statements of operations for the periods indicated: YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands) Cost of revenue $ 96 $ 31 $ 49 Research and development expense 983 305 362 Sales and marketing expense 1,289 692 413 General and administrative expense 397 150 313 Offering costs — — 38 Total stock-based compensation expense $ 2,765 $ 1,178 $ 1,175 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 9. Commitments and Contingencies We lease approximately 70,000 square feet of office space in Seattle, Washington for our corporate headquarters under a lease that expires in December 2026 with the option to renew for two five year terms. The terms of the lease provide for rental payments on a graduated scale and the right to terminate this lease beginning in December 2022, subject to the payment of certain early termination fees. We received landlord incentives totaling $4.7 million which we recorded as deferred rent obligations and are amortizing as a reduction in rental expense over the remaining term of the lease. As part of the lease amendment in May 2016 for approximately 18,000 square feet of additional office space, we will receive in 2017 landlord incentives totaling $1.7 million to offset the costs of leasehold improvements. We lease approximately 11,000 square feet of space in Seattle for a design laboratory under an operating lease that expires in October 2018 with an option to renew for an additional one or three year term. The terms of the lease provide for rental payments on a graduated scale and the right to terminate this lease early, beginning in December 2015, subject to the payment of certain early termination fees. We received landlord incentives of $108,000 and have used $95,000. We recorded these incentives as deferred rent obligations and are amortizing them as a reduction in rental expense over the term of the lease. We recognize rent expense on a straight-line basis over the lease period. Total rent expense under operating leases was $2.9 million and $1.1 million for the years ended December 31, 2016 and 2015, respectively. We lease a portion of our property and equipment under capital leases, which include options allowing us to purchase the equipment at the end of the lease term. The following table presents future minimum lease payments under operating and capital leases as of December 31, 2016 were as follows: OPERATING CAPITAL (in thousands) 2017 $ 3,096 $ 1,330 2018 3,029 1,038 2019 2,900 574 2020 2,984 261 2021 3,069 — Thereafter 16,603 — Total minimum lease payments $ 31,681 $ 3,203 Less: Portion representing interest (375 ) Present value of capital lease obligations 2,828 Less: Current portion of capital lease obligations (1,130 ) Capital lease obligations net of current portion $ 1,698 In the normal course of business, we periodically enter into agreements that require us to indemnify either major customers or suppliers for specific risks. While our maximum exposure under these indemnification provisions cannot be estimated, these indemnifications are not expected to have a material impact on our consolidated results of operations or financial condition. Obligations with Third-Party Manufacturers We manufacture products with a third-party manufacturer under recurring one year agreements. We are committed to purchase $14.1 million of inventory as of December 31, 2016. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 10. Segment Reporting Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision-maker, or decision-making group, in deciding how to allocate resources and in assessing performance. We are organized as, and operate in, one reportable segment: the development and sale of Item Intelligence products and services. Our chief operating decision- maker is the executive team, led by our chief executive officer. Our executive team regularly reviews financial information presented on a total company basis, accompanied by information about revenue and direct material gross margin by product family for purposes of monitoring our product mix impact on total gross margin. Our executive team evaluates performance based primarily on total revenue as end users are generally deploying many of our products and services to obtain the benefits of our integrated platform in the implementation of an Item Intelligence solution. Our assets are primarily located in the United States and not allocated to any specific geographic region. Therefore, geographic information is presented only for total revenue. Substantially all of our long-lived assets are located in the United States. The following table is based on the location of the value-added resellers, inlay manufacturers, reader OEMs, distributors or end users who purchased products and services directly from us. For sales to our resellers and distributors, their location may be different from the locations of the ultimate end users. Sales by geography were as follows: YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands) Americas $ 26,401 $ 21,568 $ 21,738 Asia Pacific 73,084 45,096 33,898 Europe, Middle East and Africa 12,802 11,815 8,127 Total Revenue $ 112,287 $ 78,479 $ 63,763 Total revenue in the United States was $25.9 million, $21.0 million and $19.6 million |
Retirement Plans
Retirement Plans | 12 Months Ended |
Dec. 31, 2016 | |
Compensation And Retirement Disclosure Abstract | |
Retirement Plans | Note 11. Retirement Plans In 2001, we adopted a salary deferral 401(k) plan for our employees. The plan allows employees to contribute a percentage of their pretax earnings annually, subject to limitations imposed by the Internal Revenue Service. The plan also allows us to make a matching contribution, subject to certain limitations. To date, we have not made any contributions to the plan. |
Summary of Significant Accoun20
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Accounting Principles | Accounting Principles We prepared the consolidated financial statements and accompanying notes in accordance with accounting principles generally accepted in the United States of America. |
Principles of Consolidation | Principles of Consolidation Our consolidated financial statements include the accounts of Impinj, Inc. and our wholly-owned subsidiaries Impinj RFID Technology (Shanghai) Co., Ltd., located in China, Impinj UK Ltd., located in United Kingdom, Impinj Japan LLC, located in Japan, and Impinj International, Ltd., located in the Cayman Islands. All intercompany transactions have been eliminated in consolidation. |
Public Offering | Public Offerings On July 26, 2016, we closed our initial public offering of 5,520,000 shares of common stock at an initial price to the public of $14.00 per share, including 720,000 shares of common stock pursuant to the underwriters’ option to purchase additional shares, resulting in aggregate net proceeds to us of $68.5 million after deducting underwriting discounts and commissions and offering costs. Upon the effectiveness of the registration statement related to the initial public offering on July 20, 2016, all of our outstanding shares of redeemable convertible preferred stock and outstanding preferred stock warrants, which automatically net exercised, converted into 8,531,146 shares and 123,759 shares, respectively, of common stock. The related carrying value of the redeemable convertible preferred stock and warrants of $106.1 million and $505,000, respectively, were reclassified to common stock and additional paid-in capital. On December 7, 2016, we closed our follow-on public offering of 1,527,380 shares of common stock at a price to the public of $27.00 per share, resulting in aggregate net proceeds to us of $38.7 million after deducting underwriting discounts and commissions and offering costs. |
Reverse Stock Split | Reverse Stock Split On June 16, 2016, our board of directors and stockholders approved an amendment to our certificate of incorporation to effect a reverse split of shares of our authorized, issued and outstanding common stock and redeemable convertible preferred stock at a 1-for-12 ratio. The reverse stock split was effected on July 8, 2016. The par value of our common stock and the par value of our redeemable convertible preferred stock were not adjusted as a result of the reverse stock split. All authorized, issued and outstanding shares of common stock and redeemable convertible preferred stock, warrants for common stock and redeemable convertible preferred stock, options to purchase common stock and the related per share amounts contained in these consolidated financial statements have been retroactively adjusted to reflect this reverse stock split for all periods presented. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, reserve for returns, collectability of accounts receivable, estimated costs to complete development contracts, warranty obligations, deferred revenue, inventory excess and obsolescence, depreciable lives of fixed assets, the determination of the fair value of stock awards and warrants and accrued liabilities, compensation and employee related benefits. To the extent there are material differences between these estimates, judgments, or assumptions and actual results, our financial statements will be affected. |
Risks and Uncertainties | Risks and Uncertainties Inherent in our business are various risks and uncertainties, including that we are developing advanced technologies and new applications in a rapidly changing industry. These risks include the failure to develop and extend our products and the rejection of our products by consumers, as well as other risks and uncertainties. If we do not successfully implement our business plan, certain assets may not be recoverable, certain liabilities may not be paid and investments in our capital stock may not be recoverable. Our success depends upon the acceptance of our technology, development of sales and distribution channels and our ability to generate significant revenue from the use of our technology. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments , which potentially subject us to concentrations of credit risk, We place cash and cash equivalents and investments with major financial institutions, which management assesses to be of high credit quality, in order to limit exposure of our investments. The following table presents t YEAR ENDED DECEMBER 31, 2016 2015 2014 Revenue: Customer A 16 % 14 % 11 % Customer B 14 10 11 Customer C 11 9 14 Customer D 10 15 6 Customer E 9 16 12 60 % 64 % 54 % AS OF DECEMBER 31, 2016 2015 Accounts Receivable: Customer A 15 % 15 % Customer C 8 12 Customer D 11 20 Customer E 11 11 Customer F 18 — 63 % 58 % |
Concentration of Supplier Risk | Concentration of Supplier Risk We outsource the manufacturing and production of our hardware products to a limited number of suppliers. Although there are a limited number of manufacturers for hardware products, we believe that other suppliers could provide similar products on comparable terms. A change in suppliers, however, could cause a delay in manufacturing and a possible loss of sales, which would adversely affect our operating results. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of cash deposits. We deposit our cash and cash equivalents primarily with one major financial institution, and our balances consistently exceed federally insured limits. We have not experienced any losses on our cash and cash equivalents. We define cash and cash equivalents to be all highly liquid investments purchased with an original or remaining maturity of three months or less at the date of purchase. |
Investments | Investments Our investments consist of fixed income securities, which include U.S. government agency securities, corporate notes and bonds and commercial paper. As the investments are available to support current operations, our available-for-sale securities are classified as short-term investments. Available-for-sale securities are carried at fair value with unrealized gains and losses reported as a component of accumulated other comprehensive income (loss) in stockholders’ equity (deficit), while realized gains and losses and other-than-temporary impairments are reported as a component of net income (loss) based on specific identification. An impairment charge is recorded in the consolidated statements of operations for declines in fair value below the cost of an individual investment that are deemed to be other than temporary. We assess whether a decline in value is temporary based on the length of time that the fair market value has been below cost, the severity of the decline and the intent and ability to hold or sell the investment. We did not identify any investments as other-than-temporarily impaired as of December 31, 2016. We had no cash equivalents and available-for-sale investments as of December 31, 2015. The following table presents the amortized cost, gross unrealized gains and losses, and fair value of our cash, cash equivalents and available-for-sale investments as of December 31, 2016 (in thousands): December 31, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash $ 10,667 $ — $ — $ 10,667 Cash equivalents: Money market funds 14,065 — — 14,065 U.S. government agency securities 4,996 1 — 4,997 Corporate notes and bonds 959 — — 959 Commercial Paper 2,948 — — 2,948 Short-term investments: U.S. government agency securities 36,535 6 (10 ) 36,531 Corporate notes and bonds 19,259 2 (9 ) 19,252 Commercial Paper 11,122 — — 11,122 Total assets measured at fair $ 100,551 $ 9 $ (19 ) $ 100,541 T he contractual maturities are due in one year or less on our available-for-sale investments as of December 31, 2016. |
Accounts Receivable | Accounts Receivable Accounts receivable consists of amounts billed currently due from customers and amounts earned not yet billed on development agreements, net of an allowance for doubtful accounts and an allowance for sales returns and price exceptions. The allowance for doubtful accounts is our best estimate of the amount of probable credit losses in existing accounts receivable and is determined based on historical write-off experience and on specific customer accounts believed to be a collection risk. Account balances are written off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. We record our sales returns and price exceptions allowance based on historical returns experience. The following table summarizes our allowance for doubtful accounts: BALANCE AT BEGINNING OF YEAR CHARGED TO COSTS AND EXPENSES WRITE- OFFS BALANCE AT END OF YEAR (in thousands) Allowance for doubtful accounts: During year ended December 31, 2016 $ 65 $ 42 $ — $ 107 During year ended December 31, 2015 50 15 — 65 During year ended December 31, 2014 58 (8 ) — 50 The following table summarizes our allowance for sales returns and price exceptions: BALANCE AT BEGINNING OF YEAR CHARGED TO COSTS AND EXPENSES WRITE- OFFS BALANCE AT END OF YEAR (in thousands) Allowance for sales returns and price exceptions: During year ended December 31, 2016 $ 220 $ 702 $ (745 ) $ 177 During year ended December 31, 2015 312 393 (485 ) 220 During year ended December 31, 2014 347 450 (485 ) 312 |
Inventory | Inventory Inventories consist of a combination of raw materials, work-in-progress and finished goods and are stated at the lower of cost or market. Cost is determined using the average costing method, which approximates the first in, first out, or FIFO, method. We establish reserves for excess and obsolete inventory based on our analysis of inventory levels and future sales forecasts. The following table presents the detail of inventories as of the dates presented: DECEMBER 31, 2016 2015 (in thousands) Raw materials $ 5,482 $ 852 Work-in-process 5,556 3,269 Finished goods 16,696 7,716 Total Inventory $ 27,734 $ 11,837 Inventory write-downs are included in cost of revenue and were $420,000, $191,000 and $538,000 for 2016, 2015 and 2014, respectively. We sold inventory previously written-down of $162,000, $492,000 and $0 during 2016, 2015 and 2014, respectively. We specifically identify inventory to write down by considering various factors at each reporting date, including inventory age, forecasted demand, new product release schedules, market conditions and other related factors. In considering forecasted demand, we also evaluate the likelihood of market adoption and demand from end users based upon each product’s lifecycle stage, longevity and historical product sales trends. Estimating the value of our inventory requires considerable judgment. Changes in our judgment could have a material impact on our results of operations, financial position and cash flows. |
Long-Lived Assets and Intangible Assets | Long-Lived Assets and Intangible Assets Long-lived assets include property and equipment. We assess the carrying value of our long-lived assets and intangible assets with a definite life when indicators of impairment exist, and we recognize an impairment loss when the carrying amount of an asset is not recoverable from the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Impairment losses are measured by comparing the carrying amount of a long-lived asset to its fair value. Identifiable intangible assets comprise purchased customer lists, patents and developed technologies. Identifiable intangible assets are amortized over their estimated useful lives, ranging from four to eight years, using the straight-line method, which approximates the expected use of these assets. As of December 31, 2016, all definite-lived intangible assets were fully amortized. We record property and equipment at cost, determine depreciation using the straight-line method over the estimated useful lives of the assets, capitalize additions and improvements that increase the value or extend the life of an asset, expense ordinary repairs and maintenance as incurred, and amortize leasehold improvements over the shorter of the term of the lease or the estimated useful lives of the assets. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of the net identified assets acquired in a business combination. We evaluate our goodwill for impairment annually on September 30 or when indicators for impairment exist, and we write down goodwill when impaired. To evaluate goodwill for impairment, we qualitatively assess whether it is more likely than not that the fair value of our sole reporting unit is less than the carrying amount. If so, we proceed to the first step of the goodwill impairment test in which we identify potential impairment by performing a quantitative assessment, comparing the fair value of the reporting unit to the potentially impaired value, and we proceed to step two of the impairment analysis in which we record an impairment loss equal to the excess. Indicators of impairment in our qualitative assessment would include: the impacts of significant adverse changes in legal factors; market and economic conditions; the result of our operational performance and strategic plans; adverse actions by regulators; unanticipated changes in competition and market share; and the potential for sale or disposal of all or a significant portion of our business. No triggering events occurred during 2016 and 2015. |
Revenue Recognition | Revenue Recognition We generate revenue from sales of our hardware and software products, and from development and service agreements and licensing agreements. We recognize product revenue when: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the price is fixed or determinable; and (4) collection is probable. Hardware products are typically considered delivered upon shipment. Certain arrangements contain provisions for customer acceptance. Where we are unable to demonstrate that the customer acceptance provisions are met on shipment, revenue is deferred until all acceptance criteria have been met or the acceptance clause or contingency lapses. For the sale of products to a distributor, we evaluate our ability to estimate returns, considering a number of factors including, the geography in which a sales transaction originates, payment terms and our relationship and past history with the distributor. Distributor agreements do not generally provide for a right of return for refund but do typically provide for a right of return in exchange for other similar products, subject to time and quantity limitations. If we are not able to estimate returns at the time of sale to a distributor, revenue recognition is deferred until there is persuasive evidence indicating the product has sold-through to an end user. Persuasive evidence of sell-through may include reports from distributors documenting sell-through activity, data indicating an order has shipped to an end user or other similar information. At the time of revenue recognition, we record reserves for sales returns which are estimated based on historical activity and expectations of future experience. We monitor and analyze actual experience and adjust reserves on a quarterly basis. Our reader and gateway products are sold in combination with a limited hardware warranty against manufacturer defect. Our hardware warranty includes access to repair or replacement of hardware in the event of breakage or failure resulting directly from a manufacturer defect; this warranty is provided to all customers and considered an integral part of the initial product sale. Certain software is integrated with our reader and gateway products and is essential to the functionality of the integrated products. We also sell other software that configures, manages and controls readers and gateways which is not considered essential to the functionality of the hardware product. Our multi-element arrangements generally include a combination of hardware products, extended warranty, support and other non-essential software. We allocate revenue to software and non-software deliverables based on their relative fair value. Accounting principles establish a hierarchy to determine the selling price to be used for allocating revenue to non-software deliverables as follows: (1) vendor-specific objective evidence of selling price, or VSOE; (2) third-party evidence of selling price, or TPE; and (3) best estimated selling prices, or ESP. VSOE generally exists only when we sell the deliverable separately and is the price actually charged by us for that deliverable on a stand-alone basis. When VSOE cannot be established, we attempt to establish the selling price of each element based on TPE. TPE is determined based on competitor prices for similar deliverables when sold separately. We are unable to reliably determine what similar competitor products’ selling prices are on a stand-alone basis and are therefore typically not able to determine TPE. When we are unable to establish selling price using VSOE or TPE, we use ESP in the allocation of arrangement consideration. The objective of ESP is to determine the price at which we would transact a sale if the product or service were sold on a stand-alone basis. Our ESPs for all products and services are calculated using a method consistent with the way management prices new products. We consider multiple factors in developing the ESPs for our products including our historical pricing and discounting practices, the costs incurred to manufacture the product or deliver the service, the nature of the customer relationship and market trends. In addition, we may consider other factors as appropriate, including the pricing of competitive alternatives if they exist and product-specific business objectives. We regularly review VSOE and ESP and maintain internal controls over the establishment and updates of these estimates. For software deliverables, we recognize revenue in accordance with industry specific software accounting guidance for stand-alone software licenses and related support services. Revenue from software deliverables that do not require significant production, modification or customization of our software is generally recognized when: (1) delivery has occurred; (2) there is no customer acceptance clause in the contract; (3) there are no significant post-delivery obligations remaining; (4) the price is fixed; and (5) collection of the resulting receivable is reasonably assured. For transactions where we have established VSOE for the fair value of support services as measured by the renewal prices paid by our customers when the services are sold separately on a stand-alone basis, we use the residual method to determine the amount of software product revenue to be recognized. Under the residual method, the fair value of the undelivered elements is deferred and the remaining portion of the sales amount is recognized as license revenue. Support services revenue is deferred and recognized ratably over the period during which the services are to be performed, which is typically from one to three years. In those instances where we have not established VSOE of our support services, the license and service revenue is recognized on a straight-line basis over the support period. Amounts allocated to extended support services sold with our reader products are deferred and recognized on a straight-line basis over the support services term. We account for nonrecurring engineering development agreements that involve significant production, modification or customization of our products by generally recognizing the revenue over the performance period using the percentage of completion, or POC, method. Advance payments under these agreements are deferred and recognized as earned. Under the POC method of accounting, sales and gross profit are recognized as work is performed based on the relationship between actual costs incurred and total estimated costs to complete the contract. Changes to the original estimates may be required during the life of the contract. Estimates are reviewed quarterly and the effect of any change in the estimated profitability for a contract is reflected in cost of sales. The use of the POC method of accounting involves considerable reliance on estimates in determining revenue, costs and profits and in assigning the amounts to accounting periods. We account for licensing and service agreements that do not involve significant production, modification or customization of our products generally by recognizing the revenue ratably over the performance period; advance payments under these agreements are initially deferred. We present revenue net of sales tax in our consolidated statements of operations. Shipping charges billed to customers are included in product revenue and the related shipping costs are included in cost of product revenue. |
Guarantees and Product Warranties | Guarantees and Product Warranties In the normal course of business to facilitate sales of our products, we indemnify other parties, including customers, distributors, resellers and parties to other transactions with us, with respect to certain matters. We have agreed to hold the other party harmless against losses arising from a breach of representations or covenants, from intellectual property infringement and from other claims made against certain parties. These agreements may limit the time within which an indemnification claim can be made and the amount of the claim. It is not possible to determine the maximum potential amount under these indemnification agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. We provide limited warranty coverage for most products, generally ranging from a period of 90 days to one year from the date of shipment. A liability is recorded for the estimated cost of product warranties based on historical claims, product failure rates and other factors when the related revenue is recognized. We review these estimates periodically and adjust the warranty reserves as actual experience differs from historical estimates or other information becomes available. The warranty liability primarily includes the anticipated cost of materials, labor and shipping necessary to repair or replace the product. Accrued warranty costs in 2016 and 2015 were not material. |
Research and Development Costs | Research and Development Costs Research and development costs are expensed as incurred and consist of salaries and related benefits of product development personnel, contract developers, prototype materials and other expenses related to the development of new and improved products. |
Foreign Currency | Foreign Currency The functional currency for all of our subsidiaries is the U.S. dollar. All foreign currency transactions are initially measured and recorded in U.S. dollars using the exchange rate on the date of the transaction. Foreign currency denominated assets and liabilities are remeasured at the end of each reporting period using the exchange rate at that date. We record translation gains and losses in other income (expense), net on the consolidated statements of operations. |
Income Taxes | Income Taxes We use the liability method of accounting for income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to be in effect when such assets and liabilities are recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the year that includes the enactment date. We determine deferred tax assets, including historical net operating losses, and deferred tax liabilities, based on temporary differences between the book and tax bases of assets and liabilities. We believe that it is currently more likely than not that our deferred tax assets will not be realized and as such, we have recorded a full valuation allowance for these assets. We utilize a two-step approach for evaluating uncertain tax positions. First, we evaluate recognition, which requires us to determine if the weight of available evidence indicates that a tax position is more likely than not to be sustained upon audit, including resolution of related appeals or litigation processes, if any. If a tax position is not considered more likely than not to be sustained, no benefits of the position are recognized. Second, we measure the uncertain tax position, which is based on the largest amount of benefit which is more likely than not to be realized on effective settlement. This process involves estimating our actual current tax exposure, including assessing the risks associated with tax audits, together with assessing temporary differences resulting from the different treatment of items for tax and financial reporting purposes. If actual results differ from our estimates, our net operating loss and credit carryforwards could be materially impacted. |
Stock-Based Compensation | Stock-Based Compensation We have stock-based compensation plans that are more fully described in Note 8. We account for stock-based compensation at fair value. Stock-based compensation costs are recognized based on their grant date fair value estimated using the Black-Scholes model. In valuing our options, we make assumptions about weighted-average expected lives, risk-free interest rates, volatility and dividend yields and estimate the weighted-average expected life of the options as the average of the vesting option schedule and the term of the award, since we do not have sufficient historical exercise data as a public company to provide a reasonable basis upon which to estimate expected term. The term of the award is estimated using the simplified method, as awards are plain vanilla stock options. As we do not have an extensive public trading history for shares of our common stock, is estimated using a combination of the published historical volatilities our historical volatility since becoming a publicly traded company We account for equity instruments issued to nonemployees at fair value. We value all transactions in which we receive services for the issuance of equity instruments using the fair value of the services received or by using the Black-Scholes model. The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counterparty’s performance is complete or the date on which it is probable that performance will occur. Stock-based compensation expense on options granted to nonemployees was not material for 2016 and 2015. |
Warrant Liability | Warrant Liability We account for warrant liabilities at fair value. Warrant liability costs are recognized based on their grant date fair value estimated using the Black-Scholes option pricing model. To date, all warrants have been issued in connection with entering into or refinancing of our credit facilities and the costs of the warrants were accounted for as a debt discount which is amortized and recognized in interest expense over the term of the associated credit facility. Warrants issued to purchase preferred stock were adjusted to fair value at each period end as estimated using the Black-Scholes model and the associated change in fair value is included in other income (expense), net on the consolidated statements of operations. |
Net Loss per Share Attributable to Common Stockholders | Net Loss per Share Attributable to Common Stockholders Net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding. We have outstanding stock options, unvested common stock subject to repurchase, warrants and convertible preferred stock, which are included in the calculation of diluted net loss attributable to common stockholders per share whenever to do so would be dilutive. We calculate basic and diluted net loss per share attributable to common stockholders in conformity with the two-class method required for companies with participating securities. We consider all series of convertible preferred stock to be participating securities. Under the two-class method, the net loss attributable to common stockholders is not allocated to the convertible preferred stock as the holders of convertible preferred stock do not have a contractual obligation to share in losses. The diluted net loss per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of this calculation, convertible preferred stock, options to purchase common stock and warrants to purchase common stock and convertible preferred stock are considered potentially dilutive securities but have been excluded from the calculation of diluted net loss per share attributable to common stockholders as their effect is antidilutive. Basic and diluted net loss per share was the same for each period presented, as the inclusion of all potential common shares outstanding would have been antidilutive. For the periods presented, the following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income (loss) per share attributable to common stockholders : FOR THE YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands, except per share amounts) Numerator: Net income (loss) $ (1,673 ) $ 900 $ 297 Less: Accretion of preferred stock (6,258 ) (11,301 ) (11,301 ) Net loss attributable to common stockholders—basic and diluted $ (7,931 ) $ (10,401 ) $ (11,004 ) Denominator: Weighted-average common shares outstanding 10,904 4,067 3,489 Weighted-average unvested shares of common stock subject to repurchase (126 ) (174 ) (151 ) Weighted-average shares used to compute net loss per share attributable to common stockholders—basic and diluted 10,778 3,893 3,338 Net loss per share attributable to common stockholders—basic and diluted $ (0.74 ) $ (2.67 ) $ (3.30 ) The following outstanding options, warrants and shares of preferred stock were excluded from the computation of diluted net loss per share attributable to common stockholders for the periods presented because their effect would have been antidilutive: FOR THE YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands) Redeemable convertible preferred stock — 7,885 7,885 Common stock warrants — 25 25 Redeemable convertible preferred stock warrants — 264 264 Unvested shares of common stock subject to repurchase 118 136 216 Stock options 2,310 1,896 2,007 |
Offering Costs | Offering Costs Offering costs, consisting of legal, accounting and other fees and costs related to our public offerings, were capitalized. Total offering costs of approximately $4.1 million were deferred through the completion of the public offerings and upon closing of each of the public offerings in 2016 were reclassified to additional paid-in capital as a reduction of the proceeds. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In January 2017, the Financial Accounting Standards Board issued guidance simplifying the test for goodwill impairment. This standard eliminates Step 2 from the goodwill impairment test, instead requiring an entity to recognize a goodwill impairment charge for the amount by which the goodwill carrying amount exceeds the reporting unit’s fair value. This guidance is effective for interim and annual goodwill impairment tests in fiscal years beginning after December 15, 2019, and early adoption is permitted. This guidance must be applied on a prospective basis. We expect to adopt this guidance for interim and annual goodwill impairment tests performed on testing dates after January 1, 2017. We do not expect the adoption of this guidance to have a material impact on our financial position, results of operations or cash flows. In December 2016, the FASB issued amendments to address various technical corrections and improvements. Most of the amendments are effective upon issuance, while six of the amendments require transition guidance. The amendments applicable to our business have been adopted for the year ended December 31, 2016. The adoption of these amendments did not have a material impact on our financial position, results of operations or cash flows. In December 2016, the FASB issued guidance to narrow the definition of a business. This standard provides guidance to assist entities with evaluating when a set of transferred assets and activities is a business. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017, and early adoption is permitted. This guidance must be applied prospectively to transactions occurring within the period of adoption. We expect to adopt this guidance on January 1, 2018. We do not expect the adoption of this guidance to have a material impact on our financial position, results of operations or cash flows. In August 2016, the FASB issued guidance on the classification of certain cash receipts and cash payments in the statement of cash flows. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017, and early adoption is permitted. The adoption of this guidance requires a retrospective transition method to each period presented. We adopted this guidance in the interim period ending on December 31, 2016. The adoption of this guidance did not have any impact on our statements of cash flows. In June 2016, the FASB issued guidance on the measurement of credit losses on financial instruments, which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost, replacing the existing incurred loss impairment model. This guidance is effective for interim and annual reporting periods beginning after December 15, 2019. The adoption of this guidance requires a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. We have not yet determined our approach to adoption or the impact the adoption of this guidance will have on our financial position, results of operations or cash flows. In March 2016, the FASB issued guidance on several aspects of the accounting for share-based payment transactions, including the income tax consequences, impact of forfeitures, classification of awards as either equity or liabilities and classification on the statement of cash flows. This guidance is effective for interim and annual reporting periods beginning after December 15, 2016, and early adoption is permitted. We adopted this guidance on January 1, 2017 using the modified retrospective approach through a cumulative-effect adjustment to beginning accumulated deficit, and we have elected to account for forfeitures as they occur beginning on January 1, 2017. The adoption of this guidance did not have a material impact on our financial position, results of operations or cash flows. In February 2016, the FASB issued guidance on leases. This standard requires the recognition of a right-of-use asset and lease liability on the balance sheet for all leases. This standard also requires more detailed disclosures to enable users of financial statements to understand the amount, timing, and uncertainty of cash flows arising from leases. This guidance is effective for interim and annual reporting periods beginning after December 15, 2018 and should be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, and early adoption is permitted. We expect to adopt this guidance on January 1, 2019. We anticipate this standard will have a material impact on our financial position, primarily due to our office space operating leases, as we will be required to recognize lease assets and lease liabilities on our consolidated balance sheet. We continue to assess the potential impacts of this standard, including the impact the adoption of this guidance will have on our results of operations or cash flows, if any. In January 2016, the FASB issued guidance on the recognition and measurement of financial instruments. This standard requires equity investments, except those accounted for under the equity method of accounting or those that result in consolidation of the investee, to be measured at fair value with changes in fair value recognized in net income. This standard also requires the separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017, early adoption is permitted, and the guidance must be applied prospectively to equity investments that exist as of the adoption date. We expect to adopt this guidance on January 1, 2018. We have not yet determined our approach to adoption or the impact the adoption of this guidance will have on our financial position, results of operations or cash flows. In November 2015, the FASB issued guidance on the balance sheet classification of deferred taxes. This standard requires that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. This guidance is effective for interim and annual reporting periods beginning after December 15, 2016, and early adoption is permitted. We adopted this guidance as of January 1, 2016. The adoption of this guidance has no impact on our financial position, results of operations or cash flows. In July 2015, the FASB issued guidance on the measurement of inventory. The amendments require the measurement of inventory at the lower of cost or net realizable value; where net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This guidance is effective for interim and annual reporting periods beginning after December 31, 2016, and early adoption is permitted. We adopted this guidance on January 1, 2017. We do not expect adoption to have a material impact on In August 2014, the FASB issued guidance on the disclosure of uncertainties about an entity’s ability to continue as a going concern. This standard provides guidance about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. The guidance is effective for annual reporting periods ending after December 15, 2016, and early adoption is permitted. We adopted this guidance for the year ended December 31, 2016. The adoption had no impact on our financial position, results of operations or cash flows. In May 2014, the FASB issued guidance on revenue recognition. This guidance provides that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The original effective date of this guidance was for interim and annual reporting periods beginning after December 15, 2016, early adoption is not permitted, and the guidance must be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. In July 2015, the FASB approved an optional one-year deferral of the effective date. In 2016, the FASB issued final amendments to clarify the implementation guidance for principal versus agent considerations, identifying performance obligations and the accounting for licenses of intellectual property. We currently expect to adopt the new revenue standards in the first quarter of 2018 utilizing the full retrospective transition method. While we continue to assess all potential impacts of this new standard, we currently do not expect adoption to have a material impact on revenues and the cost of sales commissions. We continue to assess the impact the adoption of this guidance will have on our financial position, results of operations and cash flows. |
Summary of Significant Accoun21
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Revenue and Accounts Receivable Concentration | The following table presents t otal revenue and accounts receivable concentration as of the dates presented: YEAR ENDED DECEMBER 31, 2016 2015 2014 Revenue: Customer A 16 % 14 % 11 % Customer B 14 10 11 Customer C 11 9 14 Customer D 10 15 6 Customer E 9 16 12 60 % 64 % 54 % AS OF DECEMBER 31, 2016 2015 Accounts Receivable: Customer A 15 % 15 % Customer C 8 12 Customer D 11 20 Customer E 11 11 Customer F 18 — 63 % 58 % |
Summary of Amortized Cost, Gross Unrealized Gains and Losses, and Estimated Fair Market Value of Cash and Cash Equivalents and Available-for-Sale Investments | The following table presents the amortized cost, gross unrealized gains and losses, and fair value of our cash, cash equivalents and available-for-sale investments as of December 31, 2016 December 31, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash $ 10,667 $ — $ — $ 10,667 Cash equivalents: Money market funds 14,065 — — 14,065 U.S. government agency securities 4,996 1 — 4,997 Corporate notes and bonds 959 — — 959 Commercial Paper 2,948 — — 2,948 Short-term investments: U.S. government agency securities 36,535 6 (10 ) 36,531 Corporate notes and bonds 19,259 2 (9 ) 19,252 Commercial Paper 11,122 — — 11,122 Total assets measured at fair $ 100,551 $ 9 $ (19 ) $ 100,541 |
Summary of Allowance for Doubtful Accounts, Sales Returns and Price Exceptions | The following table summarizes our allowance for doubtful accounts: BALANCE AT BEGINNING OF YEAR CHARGED TO COSTS AND EXPENSES WRITE- OFFS BALANCE AT END OF YEAR (in thousands) Allowance for doubtful accounts: During year ended December 31, 2016 $ 65 $ 42 $ — $ 107 During year ended December 31, 2015 50 15 — 65 During year ended December 31, 2014 58 (8 ) — 50 The following table summarizes our allowance for sales returns and price exceptions: BALANCE AT BEGINNING OF YEAR CHARGED TO COSTS AND EXPENSES WRITE- OFFS BALANCE AT END OF YEAR (in thousands) Allowance for sales returns and price exceptions: During year ended December 31, 2016 $ 220 $ 702 $ (745 ) $ 177 During year ended December 31, 2015 312 393 (485 ) 220 During year ended December 31, 2014 347 450 (485 ) 312 |
Schedule of Inventories | The following table presents the detail of inventories as of the dates presented: DECEMBER 31, 2016 2015 (in thousands) Raw materials $ 5,482 $ 852 Work-in-process 5,556 3,269 Finished goods 16,696 7,716 Total Inventory $ 27,734 $ 11,837 |
Reconciliation of the Numerator and Denominator used in Computing Basic and Diluted Net Income (Loss) Per Share Attributable to Common Stockholders | For the periods presented, the following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income (loss) per share attributable to common stockholders : FOR THE YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands, except per share amounts) Numerator: Net income (loss) $ (1,673 ) $ 900 $ 297 Less: Accretion of preferred stock (6,258 ) (11,301 ) (11,301 ) Net loss attributable to common stockholders—basic and diluted $ (7,931 ) $ (10,401 ) $ (11,004 ) Denominator: Weighted-average common shares outstanding 10,904 4,067 3,489 Weighted-average unvested shares of common stock subject to repurchase (126 ) (174 ) (151 ) Weighted-average shares used to compute net loss per share attributable to common stockholders—basic and diluted 10,778 3,893 3,338 Net loss per share attributable to common stockholders—basic and diluted $ (0.74 ) $ (2.67 ) $ (3.30 ) |
Computation of Diluted Net Loss Per Share Attributable to Common Stockholders Effect in Antidilutive | The following outstanding options, warrants and shares of preferred stock were excluded from the computation of diluted net loss per share attributable to common stockholders for the periods presented because their effect would have been antidilutive: FOR THE YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands) Redeemable convertible preferred stock — 7,885 7,885 Common stock warrants — 25 25 Redeemable convertible preferred stock warrants — 264 264 Unvested shares of common stock subject to repurchase 118 136 216 Stock options 2,310 1,896 2,007 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets Measured at Fair Value on Recurring Basis | The following tables present the balances of assets measured at fair value on a recurring basis, by level within the fair value hierarchy, as of December 31, 2016, all such balances as of December 31, 2015 were $0: DECEMBER 31, 2016 LEVEL 1 LEVEL 2 LEVEL 3 (in thousands) Cash equivalents: Money market funds $ 14,065 $ — $ — U.S. government agency securities — 4,997 — Corporate notes and bonds — 959 — Commercial Paper — 2,948 — Short-term investments: U.S. government agency securities — 36,531 — Corporate notes and bonds — 19,252 — Commercial Paper — 11,122 — Total assets measured at fair $ 14,065 $ 75,809 $ — |
Summary of Liabilities Measured at Fair Value on Recurring Basis | The following table presents the balances of liabilities measured at fair value on a recurring basis, by level within the fair value hierarchy, as of December 31, 2015, all such balances as of December 31, 2016 were $0: DECEMBER 31, 2015 LEVEL 1 LEVEL 2 LEVEL 3 (in thousands) Convertible preferred stock warrants $ — $ — $ 2,865 Total liabilities measured at fair value $ — $ — $ 2,865 |
Roll-Forward of Fair Value of Preferred Stock Warrant Liabilities Categorized as Level 3 | The following table provides a roll-forward of the fair value of the preferred stock warrant liabilities categorized as Level 3 for the years ended December 31, 2016 and 2015 (in thousands): Balance at December 31, 2013 $ 3,170 Remeasurement of convertible preferred stock warrants 398 Balance at December 31, 2014 $ 3,568 Remeasurement of convertible preferred stock warrants (703 ) Balance at December 31, 2015 2,865 Remeasurement of convertible preferred stock warrants (559 ) Exercise of preferred stock warrants (1,801 ) Conversion of preferred stock warrants into common stock warrants at initial public offering (505 ) Balance at December 31, 2016 $ — |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property and Equipment | The following table presents the detail of p roperty and equipment as of the dates presented: USEFUL DECEMBER 31, LIVES 2016 2015 (Years) (in thousands) Laboratory equipment 3 $ 6,687 $ 4,670 Computer equipment and software 3 2,529 2,703 Furniture and fixtures 3-7 228 193 Equipment acquired under capital leases 3-5 6,172 6,165 Leasehold improvements Shorter of lease term or economic 9,540 7,588 25,156 21,319 Less: Accumulated depreciation (10,227 ) (8,968 ) $ 14,929 $ 12,351 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Summary of Income Tax Expense | The following table presents the detail of income tax expense as of the periods presented: YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands) Current: US - Federal $ — $ — $ — US - State (15 ) (56 ) — Foreign (63 ) (22 ) (5 ) (78 ) (78 ) (5 ) Deferred: US - Federal (91 ) (88 ) (91 ) US - State 1 — — Foreign — — — (90 ) (88 ) (91 ) Total income tax expense $ (168 ) $ (166 ) $ (96 ) |
Reconciliation of U.S. Federal Statutory Income Tax Rate to Effective Income Tax Rate | The following table presents a reconciliation of the federal statutory rate and our effective tax rate for the periods presented: YEAR ENDED DECEMBER 31, 2016 2015 2014 U.S. Statutory Rate 34.0 % 34.0 % 34.0 % Change in valuation allowance (11.8 ) 9.9 8.9 State taxes (net of federal benefit) (4.4 ) 3.8 (33.6 ) Federal research and development credit 67.4 (60.8 ) (136.0 ) Incentive stock options (46.2 ) 19.5 83.6 Unrecognized tax benefits (47.1 ) 28.8 34.0 Preferred stock warrant revaluation 12.6 (22.4 ) 34.4 Other, net (15.5 ) 2.9 (1.0 ) Effective income tax rate (11.0) % 15.7 % 24.3 % |
Summary of Significant Components Deferred Tax Assets and Liabilities | The following table presents the significant components of our deferred tax assets and liabilities as of the dates presented: DECEMBER 31, 2016 2015 (in thousands) Net operating loss carryforwards (1) (2) $ 34,287 $ 33,783 Credit carryforwards (2) 6,492 5,693 Depreciation and amortization — 594 Capitalized research and development 6,992 8,164 Deferred rent 1,825 223 Allowances 767 261 Deferred compensation 1,209 760 Deferred revenue 331 253 Stock compensation (1) 220 323 Deferred tax assets 52,123 50,054 Less: Valuation Allowance (50,959 ) (50,054 ) Net deferred tax assets $ 1,164 $ — Deferred Tax Liability: Goodwill (766 ) (676 ) Depreciation and Amortization (1,164 ) — Deferred tax liabilities (1,930 ) (676 ) Net deferred tax liability $ (766 ) $ (676 ) ____________ (1) (2) |
Total Balance of Unrecognized Tax Benefits | The following table presents the total balance of unrecognized tax benefits as of the dates presented: YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands) Unrecognized tax benefits at beginning of the period $ 1,878 $ 1,732 $ 1,599 Gross increases to tax positions in prior periods 210 — — Gross increases to tax positions in current periods 509 146 133 Unrecognized tax benefits at end of the period $ 2,597 $ 1,878 $ 1,732 |
Debt Facilities (Tables)
Debt Facilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Senior Credit Facility | Silicon Valley Bank | |
Scheduled Principal Maturities of Debt | The following table presents the scheduled principal maturities as of December 31, 2016 (in thousands): 2017 $ 2,678 2018 4,169 2019 4,109 2020 1,458 $ 12,414 |
Redeemable Convertible Prefer26
Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Statement Of Stockholders Equity [Abstract] | |
Schedule of Preferred Stock Warrants Outstanding Exercise Price | The following table presents the preferred stock warrants outstanding, all with exercise prices of $9.318 per share, as of December 31, 2015, all such balances as of December 31, 2016 were $0: ISSUANCE FAIR VALUE AT DECEMBER 31 DATE SHARES 2015 (in thousands) Series 2 preferred stock (1) June 2, 2010 2,004 $ 24 Series 2 preferred stock (1) February 1, 2011 1,458 18 Series 2 preferred stock (1) July 13, 2012 41,666 548 Series 2 preferred stock (2) June 30, 2010 218,523 2,275 Total Series 2 redeemable convertible preferred stock 263,651 $ 2,865 (1) These warrants exercised on a net exercise basis in July 2016. (2) These warrants either were exercised prior to our initial public offering or automatically exercised on a net exercise basis as the per share price of common stock sold to the public in our initial public offering exceeded the exercise price of the warrants. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Unvested Shares of Common Stock Activity | The following table summarizes activity of unvested shares of our common stock for the year ended December 31, 2016: SHARES OUTSTANDING NUMBER OF SHARES WEIGHTED- AVERAGE EXERCISE PRICE PER SHARE (in thousands, except per share amounts) Outstanding at January 1, 2016 136 $ 1.76 Issued 59 5.35 Vested (77 ) 2.15 Outstanding at December 31, 2016 118 $ 3.30 |
Summary of Stock Option Activity | The following table summarizes option award activity for the year ended December 31, 2016: WEIGHTED- WEIGHTED- NUMBER OF AVERAGE AVERAGE SHARES EXERCISE REMAINING TOTAL UNDERLYING PRICE PER CONTRACTUAL INTRINSIC OPTIONS SHARE LIFE (YEARS) VALUE (in thousands, except per share amounts) Outstanding at January 1, 2016 1,896 $ 3.72 7.77 $ 8,666 Granted 707 20.59 Exercised (196 ) 3.05 Forfeited or cancelled (97 ) 6.28 Outstanding at December 31, 2016 2,310 8.84 7.68 61,203 Vested and exercisable December 31, 2016 1,067 $ 2.69 6.15 $ 34,831 |
Schedule of Stock Options Valuation Assumptions | In determining the fair value of stock awards granted, the following weighted-average assumptions were used in the Black-Scholes option pricing model for awards granted in the periods indicated: EMPLOYEE STOCK PURCHASE PLAN STOCK OPTIONS YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31, 2016 2016 2015 2014 Risk-free interest rates 0.4% 1.1% – 1.4% 1.2% – 1.6% 1.8% – 2.0% Expected term 0.5 years 4.3 – 6.1 years 4.3 – 6.0 years 6.0 years Expected dividends yield None None None None Volatility 61.8% 40.8% – 49.5% 41.5% – 43.4% 43.8% – 46.9% |
Summary of Stock-Based Compensation Expense | Stock-Based Compensation Expense The following table presents the detail of stock-based compensation expense amounts included in our consolidated statements of operations for the periods indicated: YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands) Cost of revenue $ 96 $ 31 $ 49 Research and development expense 983 305 362 Sales and marketing expense 1,289 692 413 General and administrative expense 397 150 313 Offering costs — — 38 Total stock-based compensation expense $ 2,765 $ 1,178 $ 1,175 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Future Minimum Lease Payments Under Operating and Capital Leases | The following table presents future minimum lease payments under operating and capital leases as of December 31, 2016 were as follows: OPERATING CAPITAL (in thousands) 2017 $ 3,096 $ 1,330 2018 3,029 1,038 2019 2,900 574 2020 2,984 261 2021 3,069 — Thereafter 16,603 — Total minimum lease payments $ 31,681 $ 3,203 Less: Portion representing interest (375 ) Present value of capital lease obligations 2,828 Less: Current portion of capital lease obligations (1,130 ) Capital lease obligations net of current portion $ 1,698 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Summary of Sales by Geography | Sales by geography were as follows: YEAR ENDED DECEMBER 31, 2016 2015 2014 (in thousands) Americas $ 26,401 $ 21,568 $ 21,738 Asia Pacific 73,084 45,096 33,898 Europe, Middle East and Africa 12,802 11,815 8,127 Total Revenue $ 112,287 $ 78,479 $ 63,763 |
Summary of Significant Accoun30
Summary of Significant Accounting Policies - Additional Information (Details) | Dec. 07, 2016USD ($)$ / sharesshares | Jul. 26, 2016USD ($)$ / sharesshares | Jun. 16, 2016 | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares | Dec. 31, 2014USD ($) | Jul. 20, 2016USD ($)shares |
Significant Accounting Policies [Line Items] | |||||||
Common stock, shares issued | shares | 20,336,000 | 4,382,000 | |||||
Aggregate net proceeds from issuance of stock | $ 38,700,000 | $ 68,500,000 | |||||
Outstanding shares of redeemable convertible preferred stock converted into common stock | shares | 8,531,146 | ||||||
Warrants automatically converted into common stock | shares | 123,759 | ||||||
Reverse split of common stock | On June 16, 2016, our board of directors and stockholders approved an amendment to our certificate of incorporation to effect a reverse split of shares of our authorized, issued and outstanding common stock and redeemable convertible preferred stock at a 1-for-12 ratio. | ||||||
Reverse stock split ratio | 0.0833 | 0.0833 | |||||
Available-for-sale investment | $ 100,541,000 | $ 0 | |||||
Inventory write-downs included in cost of revenue | 420,000 | 191,000 | $ 538,000 | ||||
Revenue from the sale of inventory previously written down | $ 111,769,000 | 77,389,000 | 58,970,000 | ||||
Foreign currency transactions, description | We record translation gains and losses in other income (expense), net on the consolidated statements of operations. | ||||||
Dividends paid on common stock | $ 0 | ||||||
Expected dividend yield | 0.00% | ||||||
Deferred offering costs | $ 4,100,000 | $ 0 | 637,000 | ||||
Minimum | |||||||
Significant Accounting Policies [Line Items] | |||||||
Identifiable intangible assets amortized over their estimated useful lives | 4 years | ||||||
Support services revenue recognition period | 1 year | ||||||
Product warranty coverage period | 90 days | ||||||
Maximum | |||||||
Significant Accounting Policies [Line Items] | |||||||
Identifiable intangible assets amortized over their estimated useful lives | 8 years | ||||||
Support services revenue recognition period | 3 years | ||||||
Product warranty coverage period | 1 year | ||||||
Inventory previously written down | |||||||
Significant Accounting Policies [Line Items] | |||||||
Revenue from the sale of inventory previously written down | $ 162,000 | 492,000 | $ 0 | ||||
Cash Equivalents | |||||||
Significant Accounting Policies [Line Items] | |||||||
Available-for-sale investment | $ 0 | ||||||
Common Stock | |||||||
Significant Accounting Policies [Line Items] | |||||||
Initial public offering of shares of common | shares | 7,047,000 | ||||||
Carrying value of redeemable convertible preferred stock | $ 106,100,000 | ||||||
Additional Paid-in Capital | |||||||
Significant Accounting Policies [Line Items] | |||||||
Carrying value of warrants | $ 505,000 | ||||||
IPO | |||||||
Significant Accounting Policies [Line Items] | |||||||
Initial public offering closing date | Jul. 26, 2016 | ||||||
Initial public offering of shares of common | shares | 5,520,000 | ||||||
Common stock, share offering price | $ / shares | $ 14 | ||||||
Underwriters option | |||||||
Significant Accounting Policies [Line Items] | |||||||
Common stock, shares issued | shares | 720,000 | ||||||
Follow-on Public Offering | |||||||
Significant Accounting Policies [Line Items] | |||||||
Initial public offering of shares of common | shares | 1,527,380 | ||||||
Common stock, share offering price | $ / shares | $ 27 | ||||||
Follow-on public offering closing date | Dec. 7, 2016 |
Summary of Significant Accoun31
Summary of Significant Accounting Policies - Schedule of Revenue and Accounts Receivable Concentration (Details) - Customer Concentration Risk | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 60.00% | 64.00% | 54.00% |
Revenue | Customer A | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 16.00% | 14.00% | 11.00% |
Revenue | Customer B | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 14.00% | 10.00% | 11.00% |
Revenue | Customer C | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 11.00% | 9.00% | 14.00% |
Revenue | Customer D | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 10.00% | 15.00% | 6.00% |
Revenue | Customer E | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 9.00% | 16.00% | 12.00% |
Accounts Receivable | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 63.00% | 58.00% | |
Accounts Receivable | Customer A | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 15.00% | 15.00% | |
Accounts Receivable | Customer C | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 8.00% | 12.00% | |
Accounts Receivable | Customer D | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 11.00% | 20.00% | |
Accounts Receivable | Customer E | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 11.00% | 11.00% | |
Accounts Receivable | Customer F | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 18.00% |
Summary of Significant Accoun32
Summary of Significant Accounting Policies - Summary of Amortized Cost, Gross Unrealized Gains and Losses, and Estimated Fair Market Value of Cash and Cash Equivalents and Available-for-Sale Investments (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule Of Cash Cash Equivalents And Investments [Line Items] | ||
Amortized Cost | $ 100,551,000 | |
Gross Unrealized Gains | 9,000 | |
Gross Unrealized Losses | (19,000) | |
Fair Value | 100,541,000 | $ 0 |
Cash | ||
Schedule Of Cash Cash Equivalents And Investments [Line Items] | ||
Amortized Cost | 10,667,000 | |
Fair Value | 10,667,000 | |
Cash Equivalents | ||
Schedule Of Cash Cash Equivalents And Investments [Line Items] | ||
Fair Value | $ 0 | |
Cash Equivalents | Money Market Funds | ||
Schedule Of Cash Cash Equivalents And Investments [Line Items] | ||
Amortized Cost | 14,065,000 | |
Fair Value | 14,065,000 | |
Cash Equivalents | U.S. Government Agency Securities | ||
Schedule Of Cash Cash Equivalents And Investments [Line Items] | ||
Amortized Cost | 4,996,000 | |
Gross Unrealized Gains | 1,000 | |
Fair Value | 4,997,000 | |
Cash Equivalents | Corporate Notes and Bonds | ||
Schedule Of Cash Cash Equivalents And Investments [Line Items] | ||
Amortized Cost | 959,000 | |
Fair Value | 959,000 | |
Cash Equivalents | Commercial Paper | ||
Schedule Of Cash Cash Equivalents And Investments [Line Items] | ||
Amortized Cost | 2,948,000 | |
Fair Value | 2,948,000 | |
Short-term Investments | U.S. Government Agency Securities | ||
Schedule Of Cash Cash Equivalents And Investments [Line Items] | ||
Amortized Cost | 36,535,000 | |
Gross Unrealized Gains | 6,000 | |
Gross Unrealized Losses | (10,000) | |
Fair Value | 36,531,000 | |
Short-term Investments | Corporate Notes and Bonds | ||
Schedule Of Cash Cash Equivalents And Investments [Line Items] | ||
Amortized Cost | 19,259,000 | |
Gross Unrealized Gains | 2,000 | |
Gross Unrealized Losses | (9,000) | |
Fair Value | 19,252,000 | |
Short-term Investments | Commercial Paper | ||
Schedule Of Cash Cash Equivalents And Investments [Line Items] | ||
Amortized Cost | 11,122,000 | |
Fair Value | $ 11,122,000 |
Summary of Significant Accoun33
Summary of Significant Accounting Policies - Summary of Allowance for Doubtful Accounts, Sales Returns and Price Exceptions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Valuation And Qualifying Accounts Disclosure [Line Items] | |||
BALANCE AT BEGINNING OF YEAR | $ 65 | $ 50 | $ 58 |
CHARGED TO COSTS AND EXPENSES | 42 | 15 | (8) |
BALANCE AT END OF YEAR | 107 | 65 | 50 |
Allowance for Sales Returns and Price Exceptions | |||
Valuation And Qualifying Accounts Disclosure [Line Items] | |||
BALANCE AT BEGINNING OF YEAR | 220 | 312 | 347 |
CHARGED TO COSTS AND EXPENSES | 702 | 393 | 450 |
WRITE-OFFS | (745) | (485) | (485) |
BALANCE AT END OF YEAR | $ 177 | $ 220 | $ 312 |
Summary of Significant Accoun34
Summary of Significant Accounting Policies - Schedule of Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 5,482 | $ 852 |
Work-in-process | 5,556 | 3,269 |
Finished goods | 16,696 | 7,716 |
Total Inventory | $ 27,734 | $ 11,837 |
Summary of Significant Accoun35
Summary of Significant Accounting Policies - Reconciliation of the Numerator and Denominator used in Computing Basic and Diluted Net Income (Loss) Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Numerator: | |||
Net income (loss) | $ (1,673) | $ 900 | $ 297 |
Less: Accretion of preferred stock | (6,258) | (11,301) | (11,301) |
Net loss attributable to common stockholders | $ (7,931) | $ (10,401) | $ (11,004) |
Denominator: | |||
Weighted-average common shares outstanding | 10,904 | 4,067 | 3,489 |
Weighted-average unvested shares of common stock subject to repurchase | (126) | (174) | (151) |
Weighted-average shares used to compute net loss per share attributable to common stockholders—basic and diluted | 10,778 | 3,893 | 3,338 |
Net loss per share attributable to common stockholders — basic and diluted | $ (0.74) | $ (2.67) | $ (3.30) |
Summary of Significant Accoun36
Summary of Significant Accounting Policies - Computation of Diluted Net Loss Per Share Attributable to Common Stockholders Effect in Antidilutive (Details) - shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Redeemable Convertible Preferred Stock | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 7,885 | 7,885 | |
Common Stock Warrants | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 25 | 25 | |
Redeemable Convertible Preferred Stock Warrants | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 264 | 264 | |
Unvested Shares of Common Stock Subject to Repurchase | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 118 | 136 | 216 |
Stock Options | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 2,310 | 1,896 | 2,007 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |
Jul. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||
Assets measured at fair value | $ 0 | ||
Liabilities measured at fair value | $ 0 | ||
Series 2 Redeemable Convertible Preferred Stock | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||
Stock fair market value | $ 17.50 | $ 19.20 | |
Stock exercise price | $ 9.318 | $ 9.318 | |
Volatility rate | 50.00% | 50.00% | |
Series 2 Redeemable Convertible Preferred Stock | Minimum | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||
Remaining contractual life of warrants | 1 year | 1 year | |
Risk-free interest rate | 0.50% | 0.60% | |
Series 2 Redeemable Convertible Preferred Stock | Maximum | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||
Remaining contractual life of warrants | 6 years | 7 years | |
Risk-free interest rate | 1.30% | 2.10% |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Assets Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 0 | |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 14,065 | |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 75,809 | |
Cash Equivalents | Level 1 | Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 14,065 | |
Cash Equivalents | Level 2 | U.S. Government Agency Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 4,997 | |
Cash Equivalents | Level 2 | Corporate Notes and Bonds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 959 | |
Cash Equivalents | Level 2 | Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 2,948 | |
Short-term Investments | Level 2 | U.S. Government Agency Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 36,531 | |
Short-term Investments | Level 2 | Corporate Notes and Bonds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 19,252 | |
Short-term Investments | Level 2 | Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 11,122 |
Fair Value Measurements - Sum39
Fair Value Measurements - Summary of Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Liabilities measured at fair value | $ 0 | |
Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Liabilities measured at fair value | $ 2,865 | |
Convertible Preferred Stock Warrants | Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Liabilities measured at fair value | $ 2,865 |
Fair Value Measurements - Roll-
Fair Value Measurements - Roll-Forward of Fair Value of Preferred Stock Warrant Liabilities Categorized as Level 3 (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Remeasurement of convertible preferred stock warrants | $ 559 | $ 703 | $ (398) |
Convertible Preferred Stock Warrants | |||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 2,865 | 3,568 | 3,170 |
Remeasurement of convertible preferred stock warrants | (559) | (703) | 398 |
Exercise of preferred stock warrants | (1,801) | ||
Conversion of preferred stock warrants into common stock warrants at initial public offering | $ (505) | ||
Ending balance | $ 2,865 | $ 3,568 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 25,156 | $ 21,319 |
Less: Accumulated depreciation | (10,227) | (8,968) |
Property and equipment, net | $ 14,929 | 12,351 |
Laboratory Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, useful lives (Years) | 3 years | |
Property and equipment, gross | $ 6,687 | 4,670 |
Computer Equipment and Software | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, useful lives (Years) | 3 years | |
Property and equipment, gross | $ 2,529 | 2,703 |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 228 | 193 |
Equipment Acquired Under Capital Leases | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 6,172 | 6,165 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 9,540 | $ 7,588 |
Property and equipment, useful lives | Shorter of lease term or economic life | |
Minimum | Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, useful lives (Years) | 3 years | |
Minimum | Equipment Acquired Under Capital Leases | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, useful lives (Years) | 3 years | |
Maximum | Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, useful lives (Years) | 7 years | |
Maximum | Equipment Acquired Under Capital Leases | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, useful lives (Years) | 5 years |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property Plant And Equipment [Abstract] | |||
Amortization of leased assets | $ 2.9 | $ 1.9 | $ 1.3 |
Property and equipment acquired under capital leases | $ 2.7 | $ 3.5 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Income Tax Contingency [Line Items] | |||||
Income tax provisions | $ 168,000 | $ 166,000 | $ 96,000 | ||
Undistributed earnings of foreign subsidiaries | 371,000 | ||||
Unrecognized deferred tax liability | 74,000 | ||||
Increase in valuation allowance | 905,000 | 106,000 | |||
Accumulated federal tax losses | 100,000,000 | 97,000,000 | |||
Accumulated state tax losses | 779,000 | 794,000 | |||
Tax benefit record from stock option | 0 | 0 | |||
Net operating loss carryforwards | [1],[2] | 34,287,000 | 33,783,000 | ||
Research and development credit carry-forwards | $ 8,500,000 | 7,500,000 | |||
Federal tax credit carryforward expiration year | 2,023 | ||||
Unrecognized tax benefits | $ 2,597,000 | $ 1,878,000 | $ 1,732,000 | $ 1,599,000 | |
Accrued interest and penalties related to unrecognized tax benefits | 0 | ||||
Accounting Standards Update 2016-09 [Member] | |||||
Income Tax Contingency [Line Items] | |||||
Net operating loss carryforwards | $ 727,000 | ||||
[1] | Carryforwards are presented net of associated tax contingencies | ||||
[2] | During the current period, we recorded an increase to the NOL and an increase to the valuation allowance of $727,000 as a result of the adoption of ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting." |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current: | |||
US - State | $ (15) | $ (56) | |
Foreign | (63) | (22) | $ (5) |
Total current | (78) | (78) | (5) |
Deferred: | |||
US - Federal | (91) | (88) | (91) |
US - State | 1 | ||
Total deferred | (90) | (88) | (91) |
Total income tax expense | $ (168) | $ (166) | $ (96) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of U.S. Federal Statutory Income Tax Rate to Effective Income Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
U.S. Statutory Rate | 34.00% | 34.00% | 34.00% |
Change in valuation allowance | (11.80%) | 9.90% | 8.90% |
State taxes (net of federal benefit) | (4.40%) | 3.80% | (33.60%) |
Federal research and development credit | 67.40% | (60.80%) | (136.00%) |
Incentive stock options | (46.20%) | 19.50% | 83.60% |
Unrecognized tax benefits | (47.10%) | 28.80% | 34.00% |
Preferred stock warrant revaluation | 12.60% | (22.40%) | 34.40% |
Other, net | (15.50%) | 2.90% | (1.00%) |
Effective income tax rate | (11.00%) | 15.70% | 24.30% |
Income Taxes - Summary of Signi
Income Taxes - Summary of Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Net operating loss carryforwards | [1],[2] | $ 34,287 | $ 33,783 |
Credit carryforwards | [1] | 6,492 | 5,693 |
Depreciation and amortization | 594 | ||
Capitalized research and development | 6,992 | 8,164 | |
Deferred rent | 1,825 | 223 | |
Allowances | 767 | 261 | |
Deferred compensation | 1,209 | 760 | |
Deferred revenue | 331 | 253 | |
Stock compensation | [2] | 220 | 323 |
Deferred tax assets | 52,123 | 50,054 | |
Less: Valuation Allowance | (50,959) | (50,054) | |
Net deferred tax assets | 1,164 | ||
Deferred Tax Liability: | |||
Goodwill | (766) | (676) | |
Depreciation and Amortization | (1,164) | ||
Deferred tax liabilities | (1,930) | (676) | |
Net deferred tax liability | $ (766) | $ (676) | |
[1] | Carryforwards are presented net of associated tax contingencies | ||
[2] | During the current period, we recorded an increase to the NOL and an increase to the valuation allowance of $727,000 as a result of the adoption of ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting." |
Income Taxes - Summary of Sig47
Income Taxes - Summary of Significant Components of Deferred Tax Assets and Liabilities (Parenthetical) (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Contingency [Line Items] | |||
Net operating loss carryforwards | [1],[2] | $ 34,287,000 | $ 33,783,000 |
Accounting Standards Update 2016-09 [Member] | |||
Income Tax Contingency [Line Items] | |||
Net operating loss carryforwards | $ 727,000 | ||
[1] | Carryforwards are presented net of associated tax contingencies | ||
[2] | During the current period, we recorded an increase to the NOL and an increase to the valuation allowance of $727,000 as a result of the adoption of ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting." |
Income Taxes - Total Balance of
Income Taxes - Total Balance of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Unrecognized tax benefits at beginning of the period | $ 1,878 | $ 1,732 | $ 1,599 |
Gross increases to tax positions in prior periods | 210 | ||
Gross increases to tax positions in current periods | 509 | 146 | 133 |
Unrecognized tax benefits at end of the period | $ 2,597 | $ 1,878 | $ 1,732 |
Debt Facilities - Senior Credit
Debt Facilities - Senior Credit Facility - Additional Information (Details) - Silicon Valley Bank - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | May 31, 2016 | |
Term Borrowings | ||
Line Of Credit Facility [Line Items] | ||
Amount of outstanding borrowings | $ 10,500,000 | $ 10,500,000 |
Line of credit facility, interest rate description | interest on term borrowings accrues at a floating rate equal to the lender’s prime rate plus 2.25% during a one year interest-only period and at a floating rate equal to the lender’s prime rate plus 1.75% after expiration of the interest-only period (6.0% at December 31, 2016). | |
Refinance in outstanding borrowings | 8,200,000 | |
Line of credit facility, month and year of first required payment | 2017-06 | |
Line of credit facility, frequency of payments | 36 equal monthly installments | |
Term Borrowings | Term Loan Prepaid On or Prior To First Anniversary of May 2016 Amendment | ||
Line Of Credit Facility [Line Items] | ||
Prepayment fee | $ 210,000 | |
Term Borrowings | Term Loan Prepaid After First Anniversary but On or Prior To Second Anniversary of May 2016 Amendment | ||
Line Of Credit Facility [Line Items] | ||
Prepayment fee | $ 105,000 | |
Term Borrowings | Prime Rate | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, basis spread on variable rate | 6.00% | |
Term Borrowings | Prime Rate | One Year Interest Only Period | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, basis spread on variable rate | 2.25% | |
Term Borrowings | Prime Rate | After Expiration of Interest Only Period | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, basis spread on variable rate | 1.75% | |
Standby Letters of Credit | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, maximum borrowing capacity | $ 5,000,000 | |
Equipment Term Loan Facility | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, maximum borrowing capacity | $ 2,000,000 | $ 2,000,000 |
Senior Credit Facility | ||
Line Of Credit Facility [Line Items] | ||
Term borrowings, extended maturity date | 2017-12 | |
Term loan, revolver and equipment loan borrowings outstanding, excluding unamortized debt issuance costs | $ 12,400,000 | |
Unamortized debt issuance costs | $ 149,000 | |
Credit facility, weighted average interest rate | 5.90% | |
Senior Credit Facility | Term Borrowings | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, maturity date | 2020-05 | |
Senior Credit Facility | Revolver Borrowings | ||
Line Of Credit Facility [Line Items] | ||
Amount of outstanding borrowings | $ 0 | |
Line of credit facility, maximum borrowing capacity | $ 15,000,000 | |
Line of credit facility, interest rate description | Interest on revolver borrowings is payable monthly and accrues at a floating rate equal to the lender’s prime rate plus 2.25% at all times when our cash held at the bank plus the amount available to borrow on the revolver is less than or equal to $8.5 million, and 1.75% when our cash held at the bank plus the amount available to borrow on the revolver is greater than $8.5 million for a period of at least 60 consecutive days (5.5% at December 31, 2016). The maturity date of the revolver is December 2017. | |
Line of credit facility, basis spread on variable rate | 5.50% | |
Line of credit facility, amount available to borrow | $ 8,500,000 | |
Senior Credit Facility | Revolver Borrowings | Cash Held At Bank Plus Amount Available To Borrow on Revolver Is Less Than or Equal To $8.5 Million | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, basis spread on variable rate | 2.25% | |
Senior Credit Facility | Revolver Borrowings | Cash Held At Bank plus Amount Available To Borrow on Revolver Is Greater Than $8.5 Million | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, basis spread on variable rate | 1.75% | |
Senior Credit Facility | Equipment Term Loan Facility | ||
Line Of Credit Facility [Line Items] | ||
Amount of outstanding borrowings | $ 1,900,000 | |
Line of credit facility, interest rate description | Accrue interest at a floating rate equal to the lender’s prime rate plus 1.75% | |
Line of credit facility, frequency of payments | 36 equal monthly installments | |
Line of credit facility, maturity date | 2020-05 | |
Line of credit facility, interest rate | 5.50% | |
Senior Credit Facility | Equipment Term Loan Facility | Equipment Loan Prepaid On or Prior To First Anniversary of Date Such Equipment Loan Was Borrowed | ||
Line Of Credit Facility [Line Items] | ||
Percentage of prepayment fee | 2.00% | |
Senior Credit Facility | Equipment Term Loan Facility | Equipment Loan Prepaid After First Anniversary of Date Such Equipment Loan Was Borrowed | ||
Line Of Credit Facility [Line Items] | ||
Percentage of prepayment fee | 1.00% | |
Senior Credit Facility | Equipment Term Loan Facility | Prime Rate | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, basis spread on variable rate | 1.75% |
Debt Facilities - Scheduled Pri
Debt Facilities - Scheduled Principal Maturities of Debt (Details) - Senior Credit Facility - Silicon Valley Bank $ in Thousands | Dec. 31, 2016USD ($) |
Line Of Credit Facility [Line Items] | |
2,017 | $ 2,678 |
2,018 | 4,169 |
2,019 | 4,109 |
2,020 | 1,458 |
Long Term Debt | $ 12,414 |
Debt Facilities - Mezzanine Cre
Debt Facilities - Mezzanine Credit Facility - Additional Information (Details) - Mezzanine Credit Facility - SG Enterprises II, LLC - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Sep. 30, 2015 | |
Line Of Credit Facility [Line Items] | ||
Unamortized debt discounts and issuance costs | $ 109,000 | |
Term Borrowings | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, maximum borrowing capacity | $ 5,000,000 | |
Line of credit facility, interest rate description | Interest on the term loan accrued at a fixed per-year rate equal to 18.0% and was payable monthly. | |
Line of credit facility, fixed interest rate | 18.00% |
Redeemable Convertible Prefer52
Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) - Additional Information (Details) $ / shares in Units, $ in Millions | Jun. 16, 2016 | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Jul. 20, 2016USD ($)shares |
Redeemable Convertible Preferred Stock and Stockholders Deficit Equity [Line Items] | ||||
Outstanding shares of redeemable convertible preferred stock converted into common stock | shares | 8,531,146 | |||
Preferred stock, conversion ratio | 0.0833 | 0.0833 | ||
Common stock, shares authorized | shares | 495,000,000 | 15,041,000 | ||
Common stock, par value | $ / shares | $ 0.001 | $ 0.001 | ||
Common stock, voting rights | Each holder of the common stock is entitled to one vote per common share | |||
Common Stock | ||||
Redeemable Convertible Preferred Stock and Stockholders Deficit Equity [Line Items] | ||||
Carrying value of redeemable convertible preferred stock | $ | $ 106.1 | |||
Warrants outstanding | shares | 25,000 | |||
Stock warrants exercise price per share | $ / shares | $ 2.52 | |||
Warrants exercise date | Jul. 31, 2016 | |||
Series 1 Redeemable Convertible Preferred Stock | ||||
Redeemable Convertible Preferred Stock and Stockholders Deficit Equity [Line Items] | ||||
Preferred stock, conversion ratio | 1 | |||
Series 2 Redeemable Convertible Preferred Stock | ||||
Redeemable Convertible Preferred Stock and Stockholders Deficit Equity [Line Items] | ||||
Preferred stock, conversion ratio | 0.80 | |||
Stock warrants exercise price per share | $ / shares | $ 0 | $ 9.318 | ||
Redeemable Convertible Preferred Stock | ||||
Redeemable Convertible Preferred Stock and Stockholders Deficit Equity [Line Items] | ||||
Redeemable convertible preferred stock accretion value non compounded interest percentage | 7.00% | |||
Accretion to redeemable convertible preferred stock value | $ | $ 6.3 | $ 11.3 |
Redeemable Convertible Prefer53
Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) - Summary of Preferred Stock Warrants Outstanding Exercise Price (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015USD ($)shares | ||
June 2, 2010 Series 2 Preferred Stock | ||
Redeemable Convertible Preferred Stock and Stockholders Deficit Equity [Line Items] | ||
Preferred stock warrants Issuance date | Jun. 2, 2010 | [1] |
Warrants outstanding | shares | 2,004 | [1] |
Fair value of preferred stock warrants | $ | $ 24 | [1] |
February 1, 2011 Series 2 Preferred Stock | ||
Redeemable Convertible Preferred Stock and Stockholders Deficit Equity [Line Items] | ||
Preferred stock warrants Issuance date | Feb. 1, 2011 | [1] |
Warrants outstanding | shares | 1,458 | [1] |
Fair value of preferred stock warrants | $ | $ 18 | [1] |
July 13, 2012 Series 2 Preferred Stock | ||
Redeemable Convertible Preferred Stock and Stockholders Deficit Equity [Line Items] | ||
Preferred stock warrants Issuance date | Jul. 13, 2012 | [1] |
Warrants outstanding | shares | 41,666 | [1] |
Fair value of preferred stock warrants | $ | $ 548 | [1] |
June 30, 2010 Series 2 Preferred Stock | ||
Redeemable Convertible Preferred Stock and Stockholders Deficit Equity [Line Items] | ||
Preferred stock warrants Issuance date | Jun. 30, 2010 | [2] |
Warrants outstanding | shares | 218,523 | [2] |
Fair value of preferred stock warrants | $ | $ 2,275 | [2] |
Series 2 Redeemable Convertible Preferred Stock | ||
Redeemable Convertible Preferred Stock and Stockholders Deficit Equity [Line Items] | ||
Warrants outstanding | shares | 263,651 | |
Fair value of preferred stock warrants | $ | $ 2,865 | |
[1] | These warrants exercised on a net exercise basis in July 2016. | |
[2] | These warrants either were exercised prior to our initial public offering or automatically exercised on a net exercise basis as the per share price of common stock sold to the public in our initial public offering exceeded the exercise price of the warrants. |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jul. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Number of unvested shares repurchased from terminated employees | 0 | 2,020 | |||
Estimated weighted-average grant-date fair value of options granted | $ 9.60 | $ 3.12 | $ 4.08 | ||
Total intrinsic value of options exercised | $ 1,100,000 | $ 3,800,000 | $ 1,900,000 | ||
Total fair value of options vested | 1,400,000 | $ 1,300,000 | $ 1,800,000 | ||
Unrecognized stock-based compensation cost related to stock options | $ 8,600,000 | $ 8,600,000 | |||
Stock Options | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock, shares reserved | 3,536,156 | 3,536,156 | |||
Unrecognized stock-based compensation cost, period for recognition | 2 years 10 months 24 days | ||||
2016 Equity Incentive Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Incentive plan effective date | Jul. 31, 2016 | ||||
Common stock, shares reserved | 1,096,234 | 1,096,234 | |||
Common stock, shares previously reserved but unissued | 674,790 | 674,790 | |||
Shares of common stock reserved for future issuance, description | The number of shares of common stock reserved for issuance under the 2016 Plan may increase on January 1 of each year, beginning on January 1, 2017 and ending on and including January 1, 2026, by the lesser of (1) 1,825,000; (2) 5% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year; or (3) a lesser number of shares determined by our board of directors. | ||||
Options granted, maximum term | 10 years | ||||
Options granted, exercisable term | 4 years | ||||
2016 Equity Incentive Plan | Lesser of Potential Outcome One | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock, shares reserved | 1,825,000 | 1,825,000 | |||
2016 Equity Incentive Plan | Lesser of Potential Outcome Two | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Percentage of total number of shares of common stock outstanding | 5.00% | ||||
2016 Employee Stock Purchase Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock, shares reserved | 365,411 | 365,411 | |||
Percentage of total number of shares of common stock outstanding | 1.00% | ||||
Unrecognized stock-based compensation cost, period for recognition | 1 month 6 days | ||||
Percentage of salary contribution by employees | 15.00% | ||||
Maximum number of shares purchase per employee | 4,000 | ||||
Percentage of price lesser than fair market value per share | 85.00% | ||||
Unrecognized stock-based compensation cost | $ 335,000 | $ 335,000 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Unvested Shares of Common Stock Activity (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Number of Shares Outstanding, Balance | shares | 136 |
Number of Shares, Issued | shares | 59 |
Number of Shares, Vested | shares | (77) |
Number of Shares Outstanding, Balance | shares | 118 |
Weighted-Average Exercise Price Per Share, Balance | $ / shares | $ 1.76 |
Weighted-Average Exercise Price Per Share, Issued | $ / shares | 5.35 |
Weighted-Average Exercise Price Per Share, Vested | $ / shares | 2.15 |
Weighted-Average Exercise Price Per Share, Balance | $ / shares | $ 3.30 |
Stock-Based Compensation - Su56
Stock-Based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Number of Shares Underlying Options, Outstanding, Beginning balance | 1,896 | |
Number of Shares Underlying Options, Granted | 707 | |
Number of Shares Underlying Options, Exercised | (196) | |
Number of Shares Underlying Options, Forfeited or Cancelled | (97) | |
Number of Shares Underlying Options, Outstanding, Ending balance | 2,310 | 1,896 |
Number of Shares Underlying Options, Vested and exercisable | 1,067 | |
Weighted-Average Exercise Price Per Share, Outstanding, Beginning balance | $ 3.72 | |
Weighted-Average Exercise Price Per Share, Granted | 20.59 | |
Weighted-Average Exercise Price Per Share, Exercised | 3.05 | |
Weighted-Average Exercise Price Per Share, Forfeited or Cancelled | 6.28 | |
Weighted-Average Exercise Price Per Share, Outstanding, Ending balance | 8.84 | $ 3.72 |
Weighted-Average Exercise Price Per Share, Vested and exercisable | $ 2.69 | |
Weighted-Average Remaining Contractual Life (Years), Outstanding | 7 years 8 months 5 days | 7 years 9 months 7 days |
Weighted-Average Remaining Contractual Life (Years), Vested and exercisable | 6 years 1 month 24 days | |
Total Intrinsic Value, Outstanding | $ 61,203 | $ 8,666 |
Total Intrinsic Value, Vested and exercisable | $ 34,831 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock Options Valuation Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected dividend yield | 0.00% | ||
Employee Stock Purchase Plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term | 6 months | ||
Expected dividend yield | 0.00% | ||
Risk-free interest rates | 0.40% | ||
Volatility | 61.80% | ||
Stock Option | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Risk-free interest rates, minimum | 1.10% | 1.20% | 1.80% |
Risk-free interest rates, maximum | 1.40% | 1.60% | 2.00% |
Expected term | 6 years | ||
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Volatility, minimum | 40.80% | 41.50% | 43.80% |
Volatility, maximum | 49.50% | 43.40% | 46.90% |
Stock Option | Minimum | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term | 4 years 3 months 18 days | 4 years 3 months 18 days | |
Stock Option | Maximum | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term | 6 years 1 month 6 days | 6 years |
Stock-Based Compensation - Su58
Stock-Based Compensation - Summary of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Total stock-based compensation expense | $ 2,765 | $ 1,178 | $ 1,175 |
Cost of Revenue | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Total stock-based compensation expense | 96 | 31 | 49 |
Research and Development Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Total stock-based compensation expense | 983 | 305 | 362 |
Selling and Marketing Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Total stock-based compensation expense | 1,289 | 692 | 413 |
General and Administrative Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Total stock-based compensation expense | $ 397 | $ 150 | 313 |
Offering Costs | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Total stock-based compensation expense | $ 38 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) | 12 Months Ended | |||
Dec. 31, 2016USD ($)ft²Option | Dec. 31, 2015USD ($) | Dec. 31, 2017USD ($) | May 31, 2016ft² | |
Operating Leased Assets [Line Items] | ||||
Rent expense under operating leases | $ 2,900,000 | $ 1,100,000 | ||
Recurring agreements term with third-party manufacturer | 1 year | |||
Inventory purchase commitment, amount | $ 14,100,000 | |||
Seattle | ||||
Operating Leased Assets [Line Items] | ||||
Lease expiration date | 2026-12 | |||
Number of renewal option | Option | 2 | |||
Lease renewal term | 5 years | |||
Right to terminate lease early, beginning period | 2022-12 | |||
Incentive from landlord | $ 4,700,000 | |||
Seattle | Design Laboratory | ||||
Operating Leased Assets [Line Items] | ||||
Office space leased | ft² | 11,000 | |||
Lease expiration date | 2018-10 | |||
Right to terminate lease early, beginning period | 2015-12 | |||
Incentive from landlord | $ 108,000 | |||
Additional lease renewal term | one or three year term | |||
Incentive amount used | $ 95,000 | |||
Seattle | Scenario, Forecast | ||||
Operating Leased Assets [Line Items] | ||||
Additional incentive from landlord | $ 1,700,000 | |||
Seattle | Original Lease | ||||
Operating Leased Assets [Line Items] | ||||
Office space leased | ft² | 70,000 | |||
Seattle | Amended Lease | ||||
Operating Leased Assets [Line Items] | ||||
Office space leased | ft² | 18,000 |
Commitments and Contingencies60
Commitments and Contingencies - Future Minimum Lease Payments Under Operating and Capital Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Commitments And Contingencies Disclosure [Abstract] | ||
Operating leases, 2017 | $ 3,096 | |
Operating leases, 2018 | 3,029 | |
Operating leases, 2019 | 2,900 | |
Operating leases, 2020 | 2,984 | |
Operating leases, 2021 | 3,069 | |
Operating leases, Thereafter | 16,603 | |
Operating leases, Total minimum lease payments | 31,681 | |
Capital leases, 2017 | 1,330 | |
Capital leases, 2018 | 1,038 | |
Capital leases, 2019 | 574 | |
Capital leases, 2020 | 261 | |
Capital leases, Total minimum lease payments | 3,203 | |
Less: Portion representing interest | (375) | |
Present value of capital lease obligations | 2,828 | |
Less: Current portion of capital lease obligations | (1,130) | $ (1,190) |
Capital lease obligations, net of current portion | $ 1,698 | $ 2,526 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016USD ($)Segment | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Segment Reporting Information [Line Items] | |||
Number of reportable segments | Segment | 1 | ||
Description of long-lived assets located | Substantially all of our long-lived assets are located in the United States. | ||
Total revenue | $ 112,287 | $ 78,479 | $ 63,763 |
United States | |||
Segment Reporting Information [Line Items] | |||
Total revenue | $ 25,900 | $ 21,000 | $ 19,600 |
Segment Reporting - Summary of
Segment Reporting - Summary of Sales by Geography (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Segment Reporting Information [Line Items] | |||
Total Revenue | $ 112,287 | $ 78,479 | $ 63,763 |
Americas | |||
Segment Reporting Information [Line Items] | |||
Total Revenue | 26,401 | 21,568 | 21,738 |
Asia Pacific | |||
Segment Reporting Information [Line Items] | |||
Total Revenue | 73,084 | 45,096 | 33,898 |
Europe, Middle East and Africa | |||
Segment Reporting Information [Line Items] | |||
Total Revenue | $ 12,802 | $ 11,815 | $ 8,127 |