Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Jan. 31, 2020 | Jun. 30, 2019 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | PI | ||
Entity Registrant Name | IMPINJ INC | ||
Entity Central Index Key | 0001114995 | ||
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 | Accelerated Filer | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Small Business | false | ||
Entity Common Stock, Shares Outstanding | 22,280,132 | ||
Entity Public Float | $ 433.5 | ||
Entity Interactive Data Current | Yes | ||
Title of 12(b) Security | Common Stock, $0.001 par value per share | ||
Security Exchange Name | NASDAQ | ||
Entity File Number | 001-37824 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 91-2041398 | ||
Entity Address, Address Line One | 400 Fairview Avenue North | ||
Entity Address, Address Line Two | Suite 1200 | ||
Entity Address, City or Town | Seattle | ||
Entity Address, State or Province | WA | ||
Entity Address, Postal Zip Code | 98109 | ||
City Area Code | 206 | ||
Local Phone Number | 517-5300 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Documents Incorporated by Reference | DOCUMENTS INCORPORATED BY REFERENCE The information required by Part III of this report, to the extent not set forth herein, is incorporated in this report by reference to the registrant’s definitive proxy statement relating to its 2020 annual meeting of stockholders. The definitive proxy statement will be filed with the Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended December 31, 2019. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 66,898 | $ 17,530 |
Short-term investments | 49,597 | 38,543 |
Accounts receivable, net of allowances of $1,281 and $551 at December 31, 2019 and 2018, respectively | 23,735 | 18,462 |
Inventory | 34,153 | 44,725 |
Prepaid expenses and other current assets | 2,386 | 1,954 |
Total current assets | 176,769 | 121,214 |
Property and equipment, net | 17,442 | 19,778 |
Operating lease right-of-use assets | 16,501 | |
Other non-current assets | 453 | 196 |
Goodwill | 3,881 | 3,881 |
Total assets | 215,046 | 145,069 |
Current liabilities: | ||
Accounts payable | 5,600 | 4,643 |
Accrued compensation and employee related benefits | 5,859 | 7,409 |
Accrued liabilities | 3,755 | 2,887 |
Current portion of operating lease liabilities | 3,380 | |
Current portion of restructuring liabilities | 94 | 582 |
Current portion of long-term debt | 5,930 | |
Current portion of finance lease liabilities | 258 | 523 |
Current portion of deferred rent | 402 | |
Current portion of deferred revenue | 551 | 649 |
Total current liabilities | 19,497 | 23,025 |
Long-term debt, net of current portion | 50,876 | 17,633 |
Operating lease liabilities, net of current portion | 18,907 | |
Finance lease liabilities, net of current portion | 1 | 258 |
Long-term liabilities — other | 313 | 304 |
Long-term restructuring liabilities | 487 | |
Deferred rent, net of current portion | 5,294 | |
Deferred revenue, net of current portion | 213 | 185 |
Total liabilities | 89,807 | 47,186 |
Commitments and contingencies (Note 11) | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value — 5,000 shares authorized, no shares issued and outstanding at December 31, 2019 and 2018 | ||
Common stock, $0.001 par value — 495,000 shares authorized, 22,217 and 21,492 shares issued and outstanding at December 31, 2019 and 2018, respectively | 22 | 21 |
Additional paid-in capital | 387,926 | 337,627 |
Accumulated other comprehensive income (loss) | 34 | (9) |
Accumulated deficit | (262,743) | (239,756) |
Total stockholders' equity | 125,239 | 97,883 |
Total liabilities and stockholders' equity | $ 215,046 | $ 145,069 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, allowances | $ 1,281 | $ 551 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
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 | 495,000,000 |
Common stock, shares issued | 22,217,000 | 21,492,000 |
Common stock, shares outstanding | 22,217,000 | 21,492,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | |||
Revenue | $ 152,836 | $ 122,633 | $ 125,300 |
Cost of revenue | 78,834 | 64,352 | 60,359 |
Gross profit | 74,002 | 58,281 | 64,941 |
Operating expenses: | |||
Research and development | 38,880 | 34,168 | 32,220 |
Sales and marketing | 32,642 | 32,934 | 31,579 |
General and administrative | 24,141 | 22,299 | 18,161 |
Restructuring costs | 3,749 | ||
Total operating expenses | 95,663 | 93,150 | 81,960 |
Loss from operations | (21,661) | (34,869) | (17,019) |
Other income, net | 1,242 | 808 | 508 |
Interest expense | (1,794) | (1,403) | (908) |
Loss on debt extinguishment | (576) | ||
Loss before income taxes | (22,789) | (35,464) | (17,419) |
Income tax benefit (expense) | (198) | 233 | 97 |
Net loss | $ (22,987) | $ (35,231) | $ (17,322) |
Net loss per share — basic and diluted | $ (1.05) | $ (1.65) | $ (0.84) |
Weighted-average shares outstanding — basic and diluted | 21,847 | 21,334 | 20,680 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Net loss | $ (22,987) | $ (35,231) | $ (17,322) |
Other comprehensive income (loss), net of tax: | |||
Unrealized gain (loss) on investments | 43 | 27 | (26) |
Total other comprehensive income (loss) | 43 | 27 | (26) |
Comprehensive loss | $ (22,944) | $ (35,204) | $ (17,348) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive (loss) |
Beginning balance at Dec. 31, 2016 | $ 124,023 | $ 20 | $ 311,216 | $ (187,203) | $ (10) |
Beginning balance, shares at Dec. 31, 2016 | 20,336 | ||||
Issuance of common stock | 4,839 | $ 1 | 4,838 | ||
Issuance of common stock, shares | 637 | ||||
Stock-based compensation | 7,428 | 7,428 | |||
Net loss | (17,322) | (17,322) | |||
Other comprehensive income (loss) | (26) | (26) | |||
Ending balance at Dec. 31, 2017 | 118,942 | $ 21 | 323,482 | (204,525) | (36) |
Ending balance, shares at Dec. 31, 2017 | 20,973 | ||||
Issuance of common stock | 2,828 | 2,828 | |||
Issuance of common stock, shares | 519 | ||||
Stock-based compensation | 11,317 | 11,317 | |||
Net loss | (35,231) | (35,231) | |||
Other comprehensive income (loss) | 27 | 27 | |||
Ending balance at Dec. 31, 2018 | 97,883 | $ 21 | 337,627 | (239,756) | (9) |
Ending balance, shares at Dec. 31, 2018 | 21,492 | ||||
Issuance of common stock | 9,197 | $ 1 | 9,196 | ||
Issuance of common stock, shares | 725 | ||||
Stock-based compensation | 18,486 | 18,486 | |||
Net loss | (22,987) | (22,987) | |||
Other comprehensive income (loss) | 43 | 43 | |||
Equity component of issuance of 2019 Notes, net of issuance costs of $1,089 (Note 7) | 32,743 | 32,743 | |||
Premiums paid for Capped Call Transactions (Note 7) | (10,126) | (10,126) | |||
Ending balance at Dec. 31, 2019 | $ 125,239 | $ 22 | $ 387,926 | $ (262,743) | $ 34 |
Ending balance, shares at Dec. 31, 2019 | 22,217 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Statement Of Stockholders Equity [Abstract] | |
Net issuance cost | $ 1,089 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating activities: | |||
Net loss | $ (22,987) | $ (35,231) | $ (17,322) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Depreciation | 4,809 | 4,534 | 3,950 |
Stock-based compensation | 18,486 | 11,317 | 7,428 |
Non-cash restructuring benefit | (454) | ||
Accretion of discount or amortization of premium on short-term investments | (506) | (419) | 70 |
Amortization of debt issuance costs and debt discount | 206 | 75 | 95 |
Loss on debt extinguishment | 576 | ||
Deferred income taxes | (395) | ||
Changes in operating assets and liabilities: | |||
Accounts receivable | (5,273) | 3,782 | (4,822) |
Inventory | 10,572 | 2,358 | (19,349) |
Prepaid expenses and other assets | (524) | 473 | 439 |
Deferred revenue | (70) | (381) | (196) |
Deferred rent | (260) | 1,191 | |
Accounts payable | 1,046 | 326 | (2,836) |
Accrued compensation and employee related benefits | (1,486) | 1,819 | (1,735) |
Operating lease right-of-use assets | 2,153 | ||
Operating lease liabilities | (3,038) | ||
Accrued liabilities and other liabilities | 744 | (390) | (2,799) |
Restructuring liabilities | 1,069 | ||
Net cash provided by (used in) operating activities | 4,708 | (11,777) | (35,886) |
Investing activities: | |||
Purchases of investments | (72,413) | (51,651) | (49,125) |
Proceeds from maturities of investments | 61,743 | 52,352 | 77,075 |
Purchases of property and equipment | (2,429) | (6,367) | (6,552) |
Net cash provided by (used in) investing activities | (13,099) | (5,666) | 21,398 |
Financing activities: | |||
Proceeds from issuance of 2019 Notes, net of issuance costs | 83,475 | ||
Premiums paid for Capped Call Transactions | (10,126) | ||
Principal payments on finance lease obligations | (522) | (900) | (1,147) |
Payments on term and equipment loans | (28,192) | (2,451) | (2,772) |
Proceeds from term loans, net of debt issuance costs | 3,991 | 16,350 | |
Proceeds from exercise of stock options and employee stock purchase plan | 9,133 | 2,689 | 4,656 |
Payments of deferred offering costs | (600) | ||
Net cash provided by financing activities | 57,759 | 15,688 | 137 |
Net increase (decrease) in cash and cash equivalents | 49,368 | (1,755) | (14,351) |
Cash and cash equivalents | |||
Beginning of period | 17,530 | 19,285 | 33,636 |
End of period | 66,898 | 17,530 | 19,285 |
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | 1,612 | 1,179 | 814 |
Supplemental disclosure of non-cash financing and investing activities: | |||
Purchases of property and equipment not yet paid | 557 | 513 | 579 |
Disposal of fully depreciated property and equipment | $ 1,432 | $ 3,105 | $ 592 |
Description of Business
Description of Business | 12 Months Ended |
Dec. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of Business | Note 1. Description of Business Impinj, Inc., a Delaware corporation, is headquartered in Seattle, Washington. Impinj enables wireless connectivity for everyday items, delivering each item’s unique identity, location and authenticity to business and consumer applications. Impinj’s platform spans endpoints, connectivity and software and provides wireless item connectivity and information delivery. Impinj derives revenue from selling endpoint ICs, reader ICs, reader modules, readers, gateways and software as well as from development, service and license agreements. Our integrated platform connects billions of everyday items to applications, 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, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements include Impinj, Inc. and its wholly owned subsidiaries. Intercompany balances and transactions have been eliminated in consolidation. These consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles, or GAAP 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 as of 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, sales incentives, estimated costs to complete development contracts, deferred revenue, inventory excess and obsolescence, income taxes, the determination of the fair value of stock awards and 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. 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, to limit our investments exposure. Year Ended December 31, 2019 2018 2017 Revenue: Avery Dennison 19 % 22 % 18 % North American Systems customer 14 * * Smartrac 12 17 14 Arizon * 10 13 Blue Star * * 10 45 % 49 % 55 % * Less than 10% As of December 31, 2019 2018 Accounts Receivable: Blue Star 18 % 13 % Avery Dennison 15 14 Smartrac 13 21 Arizon * 10 46 % 58 % * Less than 10% Concentration of Supplier Risk We outsource the manufacturing and production of our hardware products to a small 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 includes demand deposits with banks or financial institutions. Cash equivalents include short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present minimal risk of changes in value because of changes in interest rates. Our cash equivalents include only investments with an original or remaining maturity of three months or less at the date of purchase. We regularly maintain cash in excess of federally insured limits at financial institutions. Investments Our investments consist of fixed income securities, which include U.S. government agency securities, corporate notes and bonds and commercial paper. Because we use the investments to support current operations, the and 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, 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, 2019 or 2018. 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. We applied the following methods and assumptions in estimating our fair value measurements: Cash equivalents — Cash equivalents comprise highly liquid investments, including money market funds and certificates of deposit, with an original or remaining maturity of three months or less at the date of purchase . The fair value measurement of these assets is based on quoted market prices in active markets. Investments — Our investments comprise fixed income securities, which include U.S. government agency securities, corporate notes and bonds, commercial paper and treasury bills. 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 senior credit facility included in long-term debt in our consolidated balance sheets approximated carrying value based on the borrowing rates currently available to us for loans with similar terms using Level 2 inputs as of December 31, 2018. See Note 7 for the carrying amount and estimated fair value of our convertible senior notes due in 2026. Accounts Receivable and Allowances Accounts receivable comprises amounts billed currently due from customers, net of an allowance for doubtful accounts, 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 our historical collections experience, age of the receivable, knowledge of the customer and the condition of the general economy and industry as a whole We record changes in our estimate to the allowance for doubtful accounts through bad debt expense and write off the receivable and corresponding allowance when accounts are ultimately determined to be uncollectible. Bad debt expense is included in general and administrative expenses. The allowance for sales returns and price exceptions is our best estimate based on our historical experience and currently available evidence. We record changes in our estimate to the allowance for sales returns and price exceptions through revenue and relieve the allowance when product returns are received for sales returns and when claims are processed for price exceptions. . Balance at Beginning of Year Additional Reserve Applied Sales Return and Price Exceptions Balance at End of Year Allowance for sales returns and price exceptions: During year ended December 31, 2019 $ 373 $ 2,939 $ (2,240 ) $ 1,072 During year ended December 31, 2018 3,495 1,426 (4,548 ) 373 During year ended December 31, 2017 177 4,166 (848 ) 3,495 Inventory Inventories are stated at the lower of cost or estimated net realizable value using the average costing method, which approximates the first-in, first-out method. Inventories comprise raw materials, work-in-process and finished goods. We continuously assess the value of our inventory and write down its value for estimated excess and obsolete inventory. This evaluation includes an analysis of inventory on hand, current and forecasted demand, product development plans, and market conditions. If future demand or market conditions are less favorable than our projections, or our product development plans change from current expectations, a write-down of excess or obsolete inventory may be required, and would be reflected in cost of goods sold in the period the updated information is known. We recorded inventory excess and obsolescence charges, which had an unfavorable net impact Property and Equipment We record p roperty and equipment at cost and depreciate it using the straight-line method over the estimated useful lives of the related assets. The useful lives are as follows: Category Useful Life Laboratory equipment 3 to 10 years Computer equipment and software 2 to 5 years Furniture and fixtures 3 to 7 years Equipment acquired under finance leases 3 to 7 years Leasehold improvements Shorter of remaining lease term or expected useful life Maintenance and repair costs are charged to expense as incurred. Major improvements, which extend the useful life of the related asset, are capitalized. Upon disposal of a fixed asset, we record a gain or loss based on the differences between the proceeds received and the net book value of the disposed asset. Goodwill Goodwill is measured as the excess of the cost of acquisition over the sum of the amounts assigned to identifiable tangible and intangible assets acquired less liabilities assumed. We perform an annual impairment assessment of goodwill at the reporting unit level as of September 30, or more frequently if indicators of potential impairment exist. Our annual impairment assessment requires a comparison of the fair value of our reporting unit to the carrying value. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. If the carrying value of a reporting unit is greater than its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. Additionally, we will consider the income tax effect from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss. Revenue Recognition We generate revenue primarily from sales of hardware products. We also generate revenue from software, extended warranties, enhanced maintenance, support services, and nonrecurring engineering development services, all of which are not material. We recognize revenue when control of the promised goods or services is transferred to our customers, which for hardware sales is generally at the time of product shipment as determined by the agreed-upon shipping terms. We measure revenue based on the amount of consideration we expect to be entitled-to in exchange for those goods or services. The period between when we transfer control of promised goods or services and when we receive payment is expected to be one year or less, and that expectation is consistent with our historical experience. As such, we do not adjust our revenues for the effects of a significant financing component. We record any variable consideration, which primarily comprises sales incentives, as a reduction of revenue at the time of initial revenue recognition. We estimate sales incentives based on our historical experience and current expectations at the time of revenue recognition and Our reader and gateway products are highly dependent on, and interrelated with, embedded software and cannot function without this embedded software. In these cases, we account for the hardware and software license as a single performance obligation and recognize revenue at the point in time when control is transferred. Additionally, we sell standalone system software that configures, manages and controls readers and gateways and other software that performs other functions. This standalone software is not integrated directly in the functionality of the reader or gateway. Our software licenses, both for embedded and standalone software, provide the customer with a right to use the software as it exists when we make it available to the customer. Based on the software product, customers purchase either perpetual licenses or subscribe to licenses for a specified term, which differ mainly in the duration over which the customer benefits from the software. Consequently, we recognize revenue for standalone software at a point in time when the software is made available to the customer. Our contracts with customers with multiple performance obligations generally include a combination of hardware products, standalone software, extended warranty and enhanced maintenance and support services. For these contracts, we account for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling-price basis. In instances where the standalone selling price is not directly observable, such as when we do not sell the product or service separately, we determine the standalone selling price using one, or a combination of, the adjusted market assessment or expected cost-plus margin. Amounts allocated to extended warranty and enhanced maintenance sold with our reader and gateway products are deferred and recognized on a straight-line basis over the term of the arrangement, which is typically from one to three years. Amounts allocated to support services sold with our reader and gateway products are deferred and recognized when control of the promised services is transferred to our customers. For nonrecurring engineering development agreements that involve significant production, modification or customization of our products, we generally recognize revenue over the performance period using the cost-input method because it best depicts the transfer of services to the customer. We receive payments under these agreements based on a billing schedule. Contract assets relate to our conditional right to consideration for our completed performance under these agreements. Accounts receivable are recorded when the right to consideration becomes unconditional. Contract liabilities, or deferred revenue, relate to payments received in advance of performance under the contract. Contract liabilities are recognized as revenue as we perform under the contract. For the periods presented in this report, our contract assets, deferred revenue and the value of unsatisfied performance obligations for nonrecurring engineering development agreements are not material. Payment terms typically range from 30 to 120 days. We present revenue net of sales tax in our consolidated statements of operations. Shipping charges billed to customers are included in revenue and the related shipping costs are included in cost of revenue. Practical Expedients and Exemptions: We expense sales commissions when incurred because the amortization period is expected to be one year or less. We record these costs within sales and marketing expenses. We do not disclose the value of unsatisfied performance obligations for (1) contracts with an original expected length of one year or less and (2) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed Product Warranties We provide limited warranty coverage for most products, generally ranging from a period of 90 days to one year from the date of shipment. We record a liability 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 2019 and 2018 were not material. Leases We determine whether an arrangement is or contains a lease at inception. Right-of-use, or ROU, assets represent our right to use an identified asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of future lease payments over the lease term. We use an incremental borrowing rate in determining the present value of future lease payments as our operating leases do not provide an implicit rate. Our incremental borrowing rate is based on a credit-adjusted risk-free rate, which best approximates a secured rate over a similar term of lease. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Our lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes or other costs. Variable lease costs are expensed as incurred on the consolidated statements of operations. Our lease agreements generally do not contain any residual value guarantees or restrictive covenants. We have various non-cancellable operating lease agreements for office, warehouse and research and development space in the U.S., China, Thailand and Malaysia, with expiration dates from 2020 to 2026. Certain of these arrangements have free or escalating rent payment provisions and optional renewal and termination clauses that are factored into the classification and measurement of the lease when appropriate. Leases with an initial term of 12 months or less are not recorded on our consolidated balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. Research and Development Costs Research and development expense consists primarily of personnel expenses (salaries, benefits and other employee related costs) and stock-based compensation expense for our product-development personnel; external consulting and service costs; prototype materials; other new product development costs; and an allocated portion of infrastructure costs, which include occupancy, depreciation and software costs. Foreign Currency Our foreign subsidiaries are considered to be extensions of the U.S. Company. The functional currency of the foreign subsidiaries is the U.S. dollar. Accordingly, gains and losses resulting from remeasuring transactions denominated in currencies other than U.S. dollars are included in other income, net on the consolidated statements of operations. Income Taxes We use the asset and liability approach for accounting, which requires recognizing deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial statement and tax bases. We measure deferred tax assets and liabilities 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 evaluate the likelihood of our ability to realize deferred tax assets in future periods on a quarterly basis, and when appropriate evidence indicates we would revise our valuation allowance accordingly. 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 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 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. Our realization of the benefits of the NOLs and credit carryforwards depends on sufficient taxable income in future years. We have established a valuation allowance against the carrying value of our deferred tax assets, as it is currently more likely than not that we will not be able to realize these deferred tax assets. In addition, using NOLs and credits to offset future income subject to taxes may be subject to substantial annual limitations due to the “change in ownership” provisions of the Code and similar state provisions. Events that cause limitations in the amount of NOLs that we may use in any one year include, but are not limited to, a cumulative ownership change of more than 50%, as defined by Code Sections 382 and 383, over a three-year period. Utilizing our NOLs and tax credit carryforwards could be significantly reduced if a cumulative ownership change of more than 50% has occurred in our past or occurs in our future. We do not anticipate that the amount of our existing unrecognized tax benefits will significantly increase or decrease within the next 12 months. Due to the presence of NOLs in most jurisdictions, our tax years remain open for examination by taxing authorities back to 2000. Stock-Based Compensation We have equity incentive plans that are more fully described in “ Note 9 Stock-Based Awards We measure stock-based compensation costs for all share-based awards at fair value on the grant date and recognize compensation expense on a straight-line basis over the requisite service period, which typically vest over four years. We account for forfeitures as they occur. We determine the fair value of RSUs based on the closing price of our common stock at the date of grant. We determine the fair value of stock options at the date of grant by using the Black-Scholes option-pricing model. We also use the Black-Scholes option-pricing model to determine the fair value of each common share issued under the ESPP. We determine the fair value of the ESPP grants on the first day of each offering period. In 2019, we began granting RSUs with performance conditions, or PSUs, replacing what has historically been our annual cash-bonus program for our senior executives and other bonus-eligible employees. The number of PSUs that ultimately vest will depend on the extent to which we achieve specified fiscal year financial performance metrics. We record compensation expense each period on a straight-line basis based on our estimate of the most probable number of PSUs that will vest and recognize that expense over the requisite service period. Net Loss per Share Net loss per share is computed by dividing net loss by the weighted-average number of shares of common stock outstanding. We have outstanding stock options, restricted stock units and ESPPs and unvested common stock subject to repurchase which we include in the calculation of diluted net loss per share if their effect would be dilutive. The diluted net loss per share is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. We use the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted net loss per share, if applicable since we expect to settle the principal amount of the outstanding 2019 Notes in cash. For more information about the 2019 Notes, please refer to Note 7 . Recently Adopted Accounting Standards In February 2016, the Financial Accounting Standards Board, or FASB, issued guidance on leases. This standard requires recognizing a right-of-use asset and lease liability on the balance sheet for all leases. It 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 standard is effective for interim and annual reporting periods beginning after December 15, 2018. We adopted this standard on January 1, 2019 using the effective-date modified retrospective transition method and elected the available practical expedients permitted under the transition method, allowing us to carryforward our historical assessments of (1) whether contracts are or contain leases, (2) lease classification, and (3) initial direct costs. Upon adopting this standard, we recorded net operating lease ROU assets and lease liabilities In June 2018, the FASB issued guidance to improve nonemployee share-based payment accounting that requires companies to account for share-based payments granted to nonemployees similar to share-based payments granted to employees. This guidance is effective for fiscal years beginning after December 15, 2018, including the interim periods within those fiscal years. We adopted this standard on January 1, 2019 and the adoption of this guidance In August 2018, the FASB issued guidance to align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This guidance is effective for fiscal years beginning after December 15, 2019, including the interim periods within those fiscal years. Early adoption of this guidance is permitted. We early adopted this guidance prospectively on January 1, 2019 and the adoption of this guidance did not impact our financial positions, results of operations or cash flows. In December 2019, the FASB issued guidance to improve areas of GAAP by removing certain exceptions permitted by Topic 740 - Income Taxes and clarifying existing guidance to facilitate consistent application. Early adoption of the new standard is permitted. We early adopted this guidance prospectively on January 1, 2019. Since we have incurred net losses since our inception and maintained a full valuation allowance on our net deferred tax assets, the adoption did not have a material impact on our financial positions, results of operations and cash flows, or financial statement disclosures. Recently Issued Accounting Standards Not Yet Adopted In June 2016, the FASB issued guidance on measuring credit losses on financial instruments. This guidance requires measuring and recognizing expected credit losses for financial assets held at amortized cost. This guidance is effective for interim and annual reporting periods beginning after December 15, 2019, and early adoption is permitted. We will adopt this guidance on January 1, 2020. 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. While we continue to assess all potential impacts of this new standard, Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not have, or are not expected to have, a material impact on our present or future consolidated financial statements. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note The following table December 31, 2019 December 31, 2018 Level 1 Level 2 Total Level 1 Level 2 Total Cash equivalents: Money market funds $ 45,663 $ — $ 45,663 $ 11,896 $ — $ 11,896 Total cash equivalents 45,663 — 45,663 11,896 — 11,896 Short-term investments: U.S. government agency securities — 32,323 32,323 — 7,482 7,482 Corporate notes and bonds — 13,305 13,305 — 3,736 3,736 Commercial paper — 3,969 3,969 — 9,943 9,943 Treasury bills — — — — 17,382 17,382 Total short-term investments — 49,597 49,597 — 38,543 38,543 Total $ 45,663 $ 49,597 $ 95,260 $ 11,896 $ 38,543 $ 50,439 We did not have any Level 3 assets as of December 31, 2019 or 2018. There were no liabilities measured at fair value as of December 31, 2019 or 2018. |
Inventory
Inventory | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventory | Note 4. Inventory The following table December 31, 2019 December 31, 2018 Raw materials $ 5,579 $ 3,858 Work-in-process 7,485 13,671 Finished goods 21,089 27,196 Total inventory $ 34,153 $ 44,725 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | Note 5. Property and Equipment The following table December 31, 2019 December 31, 2018 Laboratory equipment $ 15,326 $ 14,505 Computer equipment and software 4,927 4,626 Furniture and fixtures 1,138 1,138 Equipment acquired under finance leases 3,461 3,972 Leasehold improvements 10,554 10,551 Total property and equipment, gross 35,406 34,792 Less: Accumulated depreciation (17,964 ) (15,014 ) Total property and equipment, net $ 17,442 $ 19,778 Depreciation expense |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 6. Income Taxes We are subject to federal and state income taxes in the United States and foreign jurisdictions. The Year Ended December 31, 2019 2018 2017 U.S. $ (23,291 ) $ (35,933 ) $ (17,761 ) Foreign 502 469 342 Loss before income taxes $ (22,789 ) $ (35,464 ) $ (17,419 ) The following table presents the detail of income tax benefit (expense) for the periods presented (in thousands): Year Ended December 31, 2019 2018 2017 Current: U.S. - Federal $ — $ — $ — U.S. - State (36 ) (23 ) (8 ) Foreign (150 ) (140 ) (126 ) (186 ) (163 ) (134 ) Deferred: U.S. - Federal (11 ) 404 241 U.S. - State (1 ) (8 ) (10 ) Foreign — — — (12 ) 396 231 Total income tax benefit (expense) $ (198 ) $ 233 $ 97 We have not recorded a liability for U.S. income taxes and foreign withholding taxes on the undistributed earnings of foreign subsidiaries as of December 31, 2019 as we intend to permanently reinvest future such earnings outside the United States. The amount of the unrecognized deferred tax liability, if incurred, is expected to be immaterial. The following table presents a reconciliation of the federal statutory rate and our effective tax rate for the periods presented: Year Ended December 31, 2019 2018 2017 U.S. Statutory Rate 21.0 % 21.0 % 34.0 % Change in valuation allowance (22.9 ) (20.6 ) 56.4 State taxes (net of federal benefit) (0.4 ) 0.5 1.9 Federal research and development credit 5.9 4.1 7.1 Incentive stock options (1.9 ) (2.9 ) 12.5 Unrecognized tax benefits (1.2 ) (1.0 ) (3.5 ) Impact of Tax Cuts and Jobs Act of 2017 — — (113.5 ) Return to provision - deductible transaction costs — — 5.6 Other, net (1.4 ) (0.4 ) 0.1 Effective income tax rate (0.9 %) 0.7 % 0.6 % We continue to maintain a full valuation allowance against our net deferred tax assets in the U.S. but recognize deferred income tax expense in the U.S. based solely on the amortization of goodwill. Our net deferred tax liability attributable to the amortization of goodwill for tax purposes decreased during the year due to the creation of indefinite net operating loss carryforwards in the current year, which can be partially realized as a result of the deferred tax liability associated with the tax amortization of goodwill. 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 significant components of our deferred tax assets and liabilities as of the dates presented (in thousands): December 31, 2019 December 31, 2018 Net operating loss carryforwards $ 38,391 $ 34,279 Credit carryforwards 9,083 8,071 Capitalized research and development 2,235 2,969 Deferred rent — 1,021 Operating lease liabilities 4,830 — Allowances 1,694 1,309 Deferred compensation 176 230 Deferred revenue 46 40 Stock-based compensation 2,846 1,340 Other 156 108 Deferred tax assets 59,457 49,367 Less: Valuation allowance (46,602 ) (48,481 ) Net deferred tax assets 12,855 886 Deferred tax liability: Goodwill (645 ) (590 ) Depreciation and amortization (1,716 ) (433 ) Operating lease ROU assets (3,576 ) — 2019 Notes (7,066 ) — Deferred tax liabilities (13,003 ) (1,023 ) Net deferred tax liability $ (148 ) $ (137 ) 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, 2019 and 2018 because, based on the weight of available evidence, it is more likely than not that the deferred tax assets will not be realized. We have accumulated federal tax losses of approximately $179.1 million and $159.5 million, respectively, as of December 31, 2019 and 2018, which are available to reduce future taxable income. We have accumulated state tax losses of approximately $23.8 million and $23.8 million, respectively, as of December 31, 2019 and 2018. Additionally, we have net research and development credit carryforwards of $12.0 million and $10.6 million, respectively, as of December 31, 2019 and 2018, which are available to reduce future tax liabilities. The pre-2018 federal tax losses and research and development credit carryforwards begin expiring in 2020. 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 2019 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 (in thousands): Year Ended December 31, 2019 2018 2017 Balance at beginning of period $ 3,159 $ 2,906 $ 2,597 Gross increase to tax positions in prior periods — — 2 Gross increase to tax positions in current periods 269 253 307 Balance at end of period $ 3,428 $ 3,159 $ 2,906 At December 31, 2019, the total amount of unrecognized tax benefits of $3.4 million is recorded as a reduction to the deferred tax asset. If recognized, it would have no impact to our effective tax rate as we have a full valuation allowance. 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. |
Long-term Debt
Long-term Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Note 7. Long-term debt Convertible Senior Notes In December 2019, we issued convertible senior notes due 2026, or the 2019 Notes, in an aggregate principal amount of $86.3 million. The 2019 Notes are our senior unsecured obligations and are governed by the indenture for the 2019 Notes. The 2019 Notes bear interest at a fixed rate of 2.00% per year, payable semi-annually in arrears on June 15 and December 15 of each year, beginning on June 15, 2020. Upon conversion, the 2019 Notes will be convertible into cash, shares of our common stock or a combination thereof, at our election. The 2019 Notes will mature on December 15, 2026, unless earlier repurchased, redeemed, or converted in accordance with the terms of the indenture. The The • during any fiscal quarter commencing after the fiscal quarter ending on March 31, 2020 (and only during such fiscal quarter), if the last reported sale price of our common stock, for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price on each applicable trading day • during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of the 2019 Notes for each trading day was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day • prior to the close of business on the second scheduled trading day immediately preceding the redemption date if we call the 2019 Notes for redemption; or • upon the occurrence of specified corporate events, as described in the Indenture. On or after September 15, 2026, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of the 2019 Notes, in multiples of $1,000 principal amount, at the option of the holder regardless of the foregoing circumstances. We may redeem the 2019 Notes for cash, at our option, on or after December 20, 2023, if the last reported sale price of our common stock has been at least 130% of the conversion price at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period at a redemption price equal to 100% of the principal amount of the 2019 Notes being redeemed, plus any accrued and unpaid interest to, but excluding, the redemption date. Holders of the 2019 Notes who convert their 2019 Notes in connection with certain corporate events that constitute a make-whole fundamental change (as defined in the indenture) are, under certain circumstances, entitled to an increase in the conversion rate. Additionally in the event of a corporate event constituting a fundamental change (as defined in the indenture), holders of the 2019 Notes may require us to repurchase all or a portion of their 2019 Notes at a repurchase price equal to 100% of the principal amount of the 2019 Notes being repurchased, plus any accrued and unpaid interest to, but excluding, the repurchase date. Certain convertible debt instruments that may be settled in cash on conversion are required to be separated into a liability and an equity component. The total proceeds are first allocated to the liability component based on the fair value of a similar debt instrument without the conversion option. The total proceeds that remain are allocated to the equity component and recognized in additional paid-in capital. Accordingly publicly available credit ratings considered to be comparable to us. The excess of the principal amount of the 2019 Notes over the initial carrying amount of the liability component was recognized as a debt discount of $33.8 million and is being amortized to interest expense over the expected term of the 2019 Notes using the effective interest rate method. The equity component of $33.8 million, calculated as the difference between the total proceeds of $86.3 million and the initial carrying amount of the liability component, was recorded in additional paid-in capital. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. As of December 31, 2019 Total The Interest expense related to the 2019 Notes for the year ended December 31, 2019 was not material. The Note 2. The December 31, 2019 Outstanding principal amount 86,250 Unamortized debt discount and debt issuance costs (35,374 ) Carrying value 50,876 In connection with the issuance of the 2019 Notes, we entered into privately negotiated capped call transactions with certain financial counterparties. The capped call transactions are generally designed to reduce potential dilution to our common stock upon any conversion or settlement of the 2019 Notes or offset any cash payments we are required to make in excess of the principal amount upon conversion of the 2019 Notes, as the case may be, with such reduction or offset subject to a cap based on the cap price. If, however, the market price per share of our common stock exceeds the cap price of the capped call transactions, there would be dilution and/or there would not be an offset of such potential cash payments, in each case, to the extent that the then-market price per share of our common stock exceeds the cap price. The cap price of the capped call transactions is initially $54.20 per share, which represents a premium of 100% over the last reported sale price of our common stock of $27.10 per share on December 11, 2019, and is subject to certain adjustments under the terms of the capped call transactions. The capped call transactions expire over 40 consecutive scheduled trading days ending on December 11, 2026. The capped call transactions meet the criteria for classification in equity, are not accounted for as derivatives, and are not remeasured each reporting period. We paid $ capped call transactions included as a reduction to additional paid-in-capital within shareholders’ equity. Senior Credit Facility On On |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2019 | |
Statement Of Stockholders Equity [Abstract] | |
Stockholders' Equity | Note 8. Stockholders’ Equity Preferred Stock Our board of directors has the authority to fix the designations, powers, preferences and rights, and the qualifications, limitations or restrictions thereof, of any wholly unissued series of preferred stock, and to increase or decrease the number of shares in any series of preferred stock, subject to limitations prescribed by law or by our certificate of incorporation. There was no preferred stock issued and outstanding Common Stock As of December 31, 2019, we had authorized 495,000,000 shares of voting The following shares of common stock December 31, 2019 Option awards outstanding 3,262 Restricted stock units outstanding 761 Common stock reserved under equity incentive plans 1,246 Common stock reserved under employee stock purchase plan 490 Total 5,759 |
Stock-Based Awards
Stock-Based Awards | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Awards | Note 9. Stock-Based Awards 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. 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 lower of (1) 1,825,000 shares; (2) 5% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year; and (3) a lesser number of shares determined by our board of directors. The 2016 Plan provides for the grant of incentive or non-qualified stock options, restricted stock, restricted stock units, stock appreciation rights and performance shares or performance units to employees, non-employee directors, and consultants. 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 allowed under the 2016 Plan, there are a few exceptions to this vesting schedule, which provide for vesting at different rates or based on achievement of performance targets. We utilize newly issued shares to satisfy option exercises. Stock Options On April 18, 2018, we commenced a voluntary stock option exchange program, designed to provide eligible employees an opportunity to exchange certain outstanding underwater stock options for a lesser amount of new options to be granted with lower exercise prices. Stock options eligible for exchange were those with an exercise price per share equal to or greater than $21.72, whether vested or unvested. All employees (including executive officers but excluding the chief executive officer) who held options and remain employed through the date of grant for new options were eligible to participate in the offer. Members of the board of directors were not eligible to participate. The option exchange program expired on May 16, 2018. Options for an aggregate of approximately 1.0 million shares were tendered by employees, representing 73% of the total shares underlying stock options eligible for exchange. On May 16, 2018, we granted options for an aggregate of 0.7 million shares in exchange for the eligible options surrendered. The new options were granted under, and subject to, the terms and conditions of the 2016 Plan. The exercise price of the new stock options is $17.33, which was the closing price of our common stock on May 16, 2018. No incremental stock option expense was recognized for the exchange, because the fair value of the surrendered options, as determined based on the Black-Scholes option-pricing model, was equal to or greater than the fair value of the new stock options issued in the exchange. The following table summarizes Number of Shares Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Life (Years) Total Intrinsic Value Outstanding at December 31, 2018 3,603 $ 17.67 8.43 $ 7,898 Granted 571 31.09 Exercised (508 ) 12.35 Forfeited or expired (404 ) 18.87 Outstanding at December 31, 2019 3,262 20.70 7.98 22,033 Vested and exercisable at December 31, 2019 1,416 $ 16.39 7.00 $ 14,345 We estimate t he fair value of options granted at the date of grant using the Black-Scholes option-pricing model with the following assumptions for the periods presented: Year Ended December 31, 2019 2018 2017 Risk-free interest rate 1.4% – 2.6% 2.3% – 3.1% 1.8% – 2.2% Expected dividends yield None None None Expected volatility 60.8% - 64.3% 57.7% - 66.1% 52.2% – 59.1% Weighted-average expected term 6.08 6.04 6.08 Weighted-average fair value of options granted $ 18.31 $ 11.85 $ 19.15 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 To determine the expected term, we generally apply and have historically applied the simplified approach in which the expected term of an award is presumed to be the mid-point between the vesting date and the expiration date of the options as we do not have sufficient historical exercise data to provide a reasonable basis for an estimate of expected term. The total intrinsic value of options exercised during 2019, 2018 and 2017 was $10.0 million, $4.3 million and $14.9 million, respectively. 2019 As of December 31, 2019, our total unrecognized stock-based compensation cost Restricted Stock Units The following table summarizes Number of Shares Weighted-Average Grant Date Fair Value RSUs PSUs RSUs PSUs Outstanding at December 31, 2018 32 — $ 20.21 $ — Granted 533 267 33.60 17.84 Vested (44 ) — 21.52 — Forfeited (12 ) (15 ) 34.58 17.03 Outstanding at December 31, 2019 509 252 $ 33.77 $ 17.88 PSUs granted during the year ended December 31, 2019 were primarily related to a PSU bonus program that replaces what has historically been our annual cash-bonus program for our senior executives and other bonus-eligible employees. The number of PSUs that ultimately vest depend on attainment of a financial metric for the fiscal year and continued employment through the vest date. Based upon attainment of the financial metric we expect approximately 239,000 shares to vest in the first quarter of 2020. We The total fair value of RSUs vested The fair value of the outstanding restricted stock units will be recorded as stock-based compensation expense over the vesting period. As of December 31, 2019, there was $15.3 million of total unrecognized compensation cost Employee Stock Purchase Plan In 2016, we adopted the 2016 Employee Stock Purchase Plan, or 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 the IRS rules. The offering periods generally start on the first trading day on or after February 20 and August 20 of each year. 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 number of shares reserved for the ESPP may increase each year, beginning on January 1, 2017 and continuing through and including January 1, 2036, by the least of: (1) 1% of the total number of shares of common stock outstanding on the first day of such year; (2) 365,411 shares of common stock; and (3) such amount as determined by our board of directors. As of December 31, 2019, the total unrecognized stock-based compensation We he fair value of the ESPP granted at the start of the offering period using the Black-Scholes option-pricing model with the following assumptions for the periods presented: Year Ended December 31, 2019 2018 2017 Risk-free interest rate 1.9% – 2.5% 2.4% 0.7% – 1.1% Expected term 0.5 years 0.3 years 0.5 years Expected volatility 66.5% – 72.3% 75.9% 66.5% – 71.2% Stock-Based Compensation Expense The following table Year Ended December 31, 2019 2018 2017 Cost of revenue $ 772 $ 469 $ 231 Research and development expense 6,427 3,663 2,431 Sales and marketing expense 6,003 4,166 3,113 General and administrative expense 5,284 3,019 1,653 Total stock-based compensation expense $ 18,486 $ 11,317 $ 7,428 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | Note 10. Leases The following table presents the components of lease expense Year Ended December 31, 2019 Operating lease costs (a) Single lease costs $ 4,170 Variable lease costs 1,623 Sublease income (b) (1,796 ) Total operating lease costs $ 3,997 Finance lease costs: Amortization of right-of-use assets 433 Interest on lease liabilities 51 Total finance lease costs 484 (a) Includes short-term lease costs, which are immaterial. (b) Sublease income is related to unused office space that was sublet as part of the restructuring in fiscal 2018 where we continue to be the primary obligor for the lease. The following table Year Ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows used in operating leases $ 4,617 Operating cash flows used in finance leases 51 Financing cash flows used in finance leases 522 The following table December 31, 2019 Weighted-average remaining lease term (years) Operating leases 6.1 Finance leases 0.7 Weighted-average discount rate Operating leases 6.8 % Finance leases 10.1 % The following table presents future lease payments Operating Leases Finance Leases Lease Payments Sublease Income Net Lease Payments 2020 $ 4,755 $ (1,373 ) $ 3,382 $ 269 2021 4,790 (1,414 ) 3,376 1 2022 4,650 (1,457 ) 3,193 — 2023 3,263 (123 ) 3,140 — 2024 3,219 — 3,219 — Thereafter 6,728 — 6,728 — Total lease payments $ 27,405 $ (4,367 ) $ 23,038 $ 270 Less: Imputed interest (5,118 ) (11 ) Present value of lease liabilities 22,287 259 Less: Current portion of lease liabilities (3,380 ) (258 ) Lease liabilities, net of current portion $ 18,907 $ 1 The following table Operating Leases Capital Leases 2019 $ 3,573 $ 575 2020 3,340 270 2021 3,305 — 2022 3,193 — 2023 3,140 — Thereafter 9,947 — Total minimum lease payments $ 26,498 $ 845 Less: Imputed interest (64 ) Present value of capital lease obligations 781 Less: Current portion of capital lease obligations (523 ) Capital lease obligations net of current portion $ 258 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11. Commitments and Contingencies Indemnifications In the normal course of business, we may enter into agreements that require us to indemnify either customers or suppliers for specific risks. While we cannot estimate our maximum exposure under these indemnification provisions, to date they have not had a material impact on our consolidated results of operations or financial condition. Litigation From time to time, we are subject to various legal proceedings or claims that arise in the ordinary course of business. We accrue a liability when management believes that it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated. As of December 31, 2019. and 2018 , we have not recorded any such liabilities. The following is a brief description of the more significant legal proceedings. Although we believe that resolving such claims, individually or in aggregate, will not have a material adverse impact on our financial statements, these matters are subject to inherent uncertainties. Federal Securities Class Actions On August 7, 2018, a class action complaint for violation of the federal securities laws was filed in the U.S. District Court for the Central District of California against us, our chief executive officer and chief operating officer. Captioned Schultz v. Impinj, Inc., et al On August 27, 2018, a second-class action complaint for violation of the federal securities laws was filed in the U.S. District Court for the Western District of Washington against us, our chief executive officer, chief operating officer and former chief financial officer. Captioned Montemarano v. Impinj, Inc., et al On October 2, 2018, a third-class action complaint for violation of the federal securities laws was filed in the U.S. District Court for the Western District of Washington against us, our chief executive officer, chief operating officer and former chief financial officer. Captioned Employees’ Retirement System of the City of Baton Rouge and Parish of East Baton Rouge v. Impinj, Inc., et al On January 14, 2019, the U.S. District Court for the Western District of Washington consolidated the Montemarano Baton Rouge On March 19, 2019, we filed a motion to dismiss the consolidated amended complaint, and on October 4, 2019, the court entered an order granting in part and denying in part the motion. The court dismissed the Section 10(b) claim against our President and chief operating officer, dismissed product capability-related allegations against our former chief financial officer, and dismissed allegations that defendants made false or misleading statements concerning increasing demand prior to the first quarter of 2017. The court denied the motion as to all other claims and defendants. A trial date has been set for February 1, 2021. New York State Securities Class Action On January 31, 2019, a fourth-class action complaint for violation of the federal securities laws was filed in the Supreme Court of the State of New York for the County of New York against us, our chief executive officer, chief operating officer, former chief financial officer, members of our board of directors and the underwriters of our July 2016 initial public stock offering, or IPO, and December 2016 secondary public offering, or SPO. Captioned Plymouth County Retirement System v. Impinj, Inc., et al. Shareholder Derivative Actions On October 26, 2018, two shareholder derivative actions were filed in the U.S. District Court for the District of Delaware against our chief executive officer, chief operating officer, former chief financial officer and certain of our directors. We are a nominal defendant. On November 8, 2018, a third shareholder derivative action was filed in this same court against the same defendants. Captioned Weiss v. Diorio, et al Fotouhi v. Diorio, et al and De la Fuente v. Diorio, et al. Patent Infringement Claims and Counterclaims On June 6, 2019, we filed a patent infringement lawsuit against NXP USA, Inc., a Delaware corporation and subsidiary of NXP Semiconductors N.V., or NXP, in the U.S. District Court for the Northern District of California. Our complaint alleges that certain NXP integrated circuit products infringed and continue to infringe numerous U.S. patents owned by us. We are seeking, among other things, past damages, including lost profits, and no less than a reasonable royalty; enhanced damages for willful infringement; and reasonable attorneys’ fees and costs for infringement of each of the asserted patents. We are also seeking an injunction against NXP making, selling, using, offering for sale or importing the RAIN RFID integrated circuit product NXP introduced in 2017. Defendants responded to our complaint on September 30, 2019 citing numerous defenses including denying infringement, claiming our asserted patents are invalid, and that the infringed patents were licensed on a royalty-free basis under Impinj’s commitments to GS1 EPCglobal. On October 4, 2019, NXP USA, Inc. and NXP, filed a patent infringement lawsuit against us in the U.S. District Court for the District of Delaware. The complaint alleges that certain of our products infringed and continue to infringe numerous U.S. patents owned by NXP or NXP USA, Inc. The plaintiffs are seeking, among other things, past damages adequate to compensate them for our alleged infringement of each of the patents-in-suit, and reasonable attorneys’ fees and costs. They are also seeking an injunction against us, enjoining continuing acts of infringement of the patents-in-suit. As of the date of this report, there is no court date set. Obligations with Third-Party Manufacturers We manufacture products with third-party manufacturers. We are committed to purchase $17.3 million of inventory |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring And Related Activities [Abstract] | |
Restructuring | Note 12. Restructuring On we initiated a restructuring plan to align our strategic and financial objectives and optimize our resources for long-term growth, including a reduction-in-force affecting approximately 9% of our employees, subleasing unused office space and closing some remote offices. The restructuring was substantially complete as of June 30, 2018. The following table Employee Termination Benefits Cease-Use Costs Total Balance at December 31, 2018 $ 94 $ 975 $ 1,069 Effect of the new lease standard adoption ( 1) — (975 ) (975 ) Balance at December 31, 2019 $ 94 $ — $ 94 (1) |
Deferred Revenue
Deferred Revenue | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Revenue Disclosure [Abstract] | |
Deferred Revenue | Note 13. Deferred Revenue Deferred revenue, comprising individually immaterial amounts for extended warranty, enhanced maintenance and advanced payments on nonrecurring engineering services contracts, represents contracted revenue that has not yet been recognized. The following table Year Ended December 31, 2019 2018 Balance at beginning of period $ 834 $ 1,215 Deferral of revenue 718 587 Recognition of deferred revenue (788 ) (968 ) Balance at end of period $ 764 $ 834 During 2019, we recognized as revenue a total of $ million related to amounts that were recorded in deferred revenue as of December 31, 2017. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 14. Segment Reporting We have one reportable and operating segment: the development and sale of our products and services. Our reportable segment has been identified based on how our chief operating decision-maker manages our business, makes operating decisions and evaluates our operating performance. Our chief executive officer acts as the chief operating decision-maker and reviews financial and operational information on an entity-wide basis. We have one business activity and there are no segment managers who are held accountable for operations, operating results or plans for levels or components. Accordingly, we have determined that we have a single reporting segment and operating unit structure. Our chief executive officer reviews information about revenue categories, including endpoint ICs and systems. We define systems as reader ICs, reader modules, readers, gateways and software The following table presents our revenue categories for the periods presented (in thousands): Year Ended December 31, 2019 2018 2017 Revenue: Endpoint ICs $ 97,657 $ 84,974 $ 91,699 Systems 55,179 37,659 33,601 Total revenue $ 152,836 $ 122,633 $ 125,300 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 our long-lived assets are located in the United States. Revenue presented in 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. The following table Year Ended December 31, 2019 2018 2017 Americas $ 53,260 $ 30,636 $ 29,656 Asia Pacific 89,012 79,290 80,531 Europe, Middle East and Africa 10,564 12,707 15,113 Total revenue $ 152,836 $ 122,633 $ 125,300 Total revenue in the United States |
Net Loss Per Share
Net Loss Per Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Note 15. Net Loss per Share For the periods presented, the following table Year Ended December 31, 2019 2018 2017 Numerator: Net loss $ (22,987 ) $ (35,231 ) $ (17,322 ) Denominator: Weighted-average shares outstanding — basic and diluted 21,847 21,334 20,680 Net loss per share — basic and diluted $ (1.05 ) $ (1.65 ) $ (0.84 ) The following outstanding options and restricted stock units and unvested shares excluded from the computation of diluted net loss per share Year Ended December 31, 2019 2018 2017 Stock options and restricted stock units 3,908 3,284 2,911 Unvested shares of common stock subject to repurchase 3 20 48 Since we expect to settle the principal amount of the outstanding 2019 Notes in cash, we use the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted net income per share, if applicable . For the 2019 Notes, the conversion spread for the notes has a dilutive impact on diluted net income per share when the average market price of our common stock during each reporting period exceeds $34.55 per share |
Retirement Plans
Retirement Plans | 12 Months Ended |
Dec. 31, 2019 | |
Compensation And Retirement Disclosure [Abstract] | |
Retirement Plans | Note 16. 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 Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements include Impinj, Inc. and its wholly owned subsidiaries. Intercompany balances and transactions have been eliminated in consolidation. These consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles, or GAAP |
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 as of 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, sales incentives, estimated costs to complete development contracts, deferred revenue, inventory excess and obsolescence, income taxes, the determination of the fair value of stock awards and 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. |
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, to limit our investments exposure. Year Ended December 31, 2019 2018 2017 Revenue: Avery Dennison 19 % 22 % 18 % North American Systems customer 14 * * Smartrac 12 17 14 Arizon * 10 13 Blue Star * * 10 45 % 49 % 55 % * Less than 10% As of December 31, 2019 2018 Accounts Receivable: Blue Star 18 % 13 % Avery Dennison 15 14 Smartrac 13 21 Arizon * 10 46 % 58 % * Less than 10% |
Concentration of Supplier Risk | Concentration of Supplier Risk We outsource the manufacturing and production of our hardware products to a small 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 includes demand deposits with banks or financial institutions. Cash equivalents include short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present minimal risk of changes in value because of changes in interest rates. Our cash equivalents include only investments with an original or remaining maturity of three months or less at the date of purchase. We regularly maintain cash in excess of federally insured limits at financial institutions. |
Investments | Investments Our investments consist of fixed income securities, which include U.S. government agency securities, corporate notes and bonds and commercial paper. Because we use the investments to support current operations, the and 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, 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, 2019 or 2018. |
Fair Value Measurement | 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. We applied the following methods and assumptions in estimating our fair value measurements: Cash equivalents — Cash equivalents comprise highly liquid investments, including money market funds and certificates of deposit, with an original or remaining maturity of three months or less at the date of purchase . The fair value measurement of these assets is based on quoted market prices in active markets. Investments — Our investments comprise fixed income securities, which include U.S. government agency securities, corporate notes and bonds, commercial paper and treasury bills. 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 senior credit facility included in long-term debt in our consolidated balance sheets approximated carrying value based on the borrowing rates currently available to us for loans with similar terms using Level 2 inputs as of December 31, 2018. See Note 7 for the carrying amount and estimated fair value of our convertible senior notes due in 2026. |
Accounts Receivable and Allowances | Accounts Receivable and Allowances Accounts receivable comprises amounts billed currently due from customers, net of an allowance for doubtful accounts, 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 our historical collections experience, age of the receivable, knowledge of the customer and the condition of the general economy and industry as a whole We record changes in our estimate to the allowance for doubtful accounts through bad debt expense and write off the receivable and corresponding allowance when accounts are ultimately determined to be uncollectible. Bad debt expense is included in general and administrative expenses. The allowance for sales returns and price exceptions is our best estimate based on our historical experience and currently available evidence. We record changes in our estimate to the allowance for sales returns and price exceptions through revenue and relieve the allowance when product returns are received for sales returns and when claims are processed for price exceptions. . Balance at Beginning of Year Additional Reserve Applied Sales Return and Price Exceptions Balance at End of Year Allowance for sales returns and price exceptions: During year ended December 31, 2019 $ 373 $ 2,939 $ (2,240 ) $ 1,072 During year ended December 31, 2018 3,495 1,426 (4,548 ) 373 During year ended December 31, 2017 177 4,166 (848 ) 3,495 |
Inventory | Inventory Inventories are stated at the lower of cost or estimated net realizable value using the average costing method, which approximates the first-in, first-out method. Inventories comprise raw materials, work-in-process and finished goods. We continuously assess the value of our inventory and write down its value for estimated excess and obsolete inventory. This evaluation includes an analysis of inventory on hand, current and forecasted demand, product development plans, and market conditions. If future demand or market conditions are less favorable than our projections, or our product development plans change from current expectations, a write-down of excess or obsolete inventory may be required, and would be reflected in cost of goods sold in the period the updated information is known. We recorded inventory excess and obsolescence charges, which had an unfavorable net impact |
Property and Equipment | Property and Equipment We record p roperty and equipment at cost and depreciate it using the straight-line method over the estimated useful lives of the related assets. The useful lives are as follows: Category Useful Life Laboratory equipment 3 to 10 years Computer equipment and software 2 to 5 years Furniture and fixtures 3 to 7 years Equipment acquired under finance leases 3 to 7 years Leasehold improvements Shorter of remaining lease term or expected useful life Maintenance and repair costs are charged to expense as incurred. Major improvements, which extend the useful life of the related asset, are capitalized. Upon disposal of a fixed asset, we record a gain or loss based on the differences between the proceeds received and the net book value of the disposed asset. |
Goodwill | Goodwill Goodwill is measured as the excess of the cost of acquisition over the sum of the amounts assigned to identifiable tangible and intangible assets acquired less liabilities assumed. We perform an annual impairment assessment of goodwill at the reporting unit level as of September 30, or more frequently if indicators of potential impairment exist. Our annual impairment assessment requires a comparison of the fair value of our reporting unit to the carrying value. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. If the carrying value of a reporting unit is greater than its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. Additionally, we will consider the income tax effect from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss. |
Revenue Recognition | Revenue Recognition We generate revenue primarily from sales of hardware products. We also generate revenue from software, extended warranties, enhanced maintenance, support services, and nonrecurring engineering development services, all of which are not material. We recognize revenue when control of the promised goods or services is transferred to our customers, which for hardware sales is generally at the time of product shipment as determined by the agreed-upon shipping terms. We measure revenue based on the amount of consideration we expect to be entitled-to in exchange for those goods or services. The period between when we transfer control of promised goods or services and when we receive payment is expected to be one year or less, and that expectation is consistent with our historical experience. As such, we do not adjust our revenues for the effects of a significant financing component. We record any variable consideration, which primarily comprises sales incentives, as a reduction of revenue at the time of initial revenue recognition. We estimate sales incentives based on our historical experience and current expectations at the time of revenue recognition and Our reader and gateway products are highly dependent on, and interrelated with, embedded software and cannot function without this embedded software. In these cases, we account for the hardware and software license as a single performance obligation and recognize revenue at the point in time when control is transferred. Additionally, we sell standalone system software that configures, manages and controls readers and gateways and other software that performs other functions. This standalone software is not integrated directly in the functionality of the reader or gateway. Our software licenses, both for embedded and standalone software, provide the customer with a right to use the software as it exists when we make it available to the customer. Based on the software product, customers purchase either perpetual licenses or subscribe to licenses for a specified term, which differ mainly in the duration over which the customer benefits from the software. Consequently, we recognize revenue for standalone software at a point in time when the software is made available to the customer. Our contracts with customers with multiple performance obligations generally include a combination of hardware products, standalone software, extended warranty and enhanced maintenance and support services. For these contracts, we account for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling-price basis. In instances where the standalone selling price is not directly observable, such as when we do not sell the product or service separately, we determine the standalone selling price using one, or a combination of, the adjusted market assessment or expected cost-plus margin. Amounts allocated to extended warranty and enhanced maintenance sold with our reader and gateway products are deferred and recognized on a straight-line basis over the term of the arrangement, which is typically from one to three years. Amounts allocated to support services sold with our reader and gateway products are deferred and recognized when control of the promised services is transferred to our customers. For nonrecurring engineering development agreements that involve significant production, modification or customization of our products, we generally recognize revenue over the performance period using the cost-input method because it best depicts the transfer of services to the customer. We receive payments under these agreements based on a billing schedule. Contract assets relate to our conditional right to consideration for our completed performance under these agreements. Accounts receivable are recorded when the right to consideration becomes unconditional. Contract liabilities, or deferred revenue, relate to payments received in advance of performance under the contract. Contract liabilities are recognized as revenue as we perform under the contract. For the periods presented in this report, our contract assets, deferred revenue and the value of unsatisfied performance obligations for nonrecurring engineering development agreements are not material. Payment terms typically range from 30 to 120 days. We present revenue net of sales tax in our consolidated statements of operations. Shipping charges billed to customers are included in revenue and the related shipping costs are included in cost of revenue. Practical Expedients and Exemptions: We expense sales commissions when incurred because the amortization period is expected to be one year or less. We record these costs within sales and marketing expenses. We do not disclose the value of unsatisfied performance obligations for (1) contracts with an original expected length of one year or less and (2) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed |
Product Warranties | Product Warranties We provide limited warranty coverage for most products, generally ranging from a period of 90 days to one year from the date of shipment. We record a liability 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 2019 and 2018 were not material. |
Leases | Leases We determine whether an arrangement is or contains a lease at inception. Right-of-use, or ROU, assets represent our right to use an identified asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of future lease payments over the lease term. We use an incremental borrowing rate in determining the present value of future lease payments as our operating leases do not provide an implicit rate. Our incremental borrowing rate is based on a credit-adjusted risk-free rate, which best approximates a secured rate over a similar term of lease. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Our lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes or other costs. Variable lease costs are expensed as incurred on the consolidated statements of operations. Our lease agreements generally do not contain any residual value guarantees or restrictive covenants. We have various non-cancellable operating lease agreements for office, warehouse and research and development space in the U.S., China, Thailand and Malaysia, with expiration dates from 2020 to 2026. Certain of these arrangements have free or escalating rent payment provisions and optional renewal and termination clauses that are factored into the classification and measurement of the lease when appropriate. Leases with an initial term of 12 months or less are not recorded on our consolidated balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. |
Research and Development Costs | Research and Development Costs Research and development expense consists primarily of personnel expenses (salaries, benefits and other employee related costs) and stock-based compensation expense for our product-development personnel; external consulting and service costs; prototype materials; other new product development costs; and an allocated portion of infrastructure costs, which include occupancy, depreciation and software costs. |
Foreign Currency | Foreign Currency Our foreign subsidiaries are considered to be extensions of the U.S. Company. The functional currency of the foreign subsidiaries is the U.S. dollar. Accordingly, gains and losses resulting from remeasuring transactions denominated in currencies other than U.S. dollars are included in other income, net on the consolidated statements of operations. |
Income Taxes | Income Taxes We use the asset and liability approach for accounting, which requires recognizing deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial statement and tax bases. We measure deferred tax assets and liabilities 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 evaluate the likelihood of our ability to realize deferred tax assets in future periods on a quarterly basis, and when appropriate evidence indicates we would revise our valuation allowance accordingly. 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 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 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. Our realization of the benefits of the NOLs and credit carryforwards depends on sufficient taxable income in future years. We have established a valuation allowance against the carrying value of our deferred tax assets, as it is currently more likely than not that we will not be able to realize these deferred tax assets. In addition, using NOLs and credits to offset future income subject to taxes may be subject to substantial annual limitations due to the “change in ownership” provisions of the Code and similar state provisions. Events that cause limitations in the amount of NOLs that we may use in any one year include, but are not limited to, a cumulative ownership change of more than 50%, as defined by Code Sections 382 and 383, over a three-year period. Utilizing our NOLs and tax credit carryforwards could be significantly reduced if a cumulative ownership change of more than 50% has occurred in our past or occurs in our future. We do not anticipate that the amount of our existing unrecognized tax benefits will significantly increase or decrease within the next 12 months. Due to the presence of NOLs in most jurisdictions, our tax years remain open for examination by taxing authorities back to 2000. |
Stock-Based Compensation | Stock-Based Compensation We have equity incentive plans that are more fully described in “ Note 9 Stock-Based Awards We measure stock-based compensation costs for all share-based awards at fair value on the grant date and recognize compensation expense on a straight-line basis over the requisite service period, which typically vest over four years. We account for forfeitures as they occur. We determine the fair value of RSUs based on the closing price of our common stock at the date of grant. We determine the fair value of stock options at the date of grant by using the Black-Scholes option-pricing model. We also use the Black-Scholes option-pricing model to determine the fair value of each common share issued under the ESPP. We determine the fair value of the ESPP grants on the first day of each offering period. In 2019, we began granting RSUs with performance conditions, or PSUs, replacing what has historically been our annual cash-bonus program for our senior executives and other bonus-eligible employees. The number of PSUs that ultimately vest will depend on the extent to which we achieve specified fiscal year financial performance metrics. We record compensation expense each period on a straight-line basis based on our estimate of the most probable number of PSUs that will vest and recognize that expense over the requisite service period. |
Net Loss per Share | Net Loss per Share Net loss per share is computed by dividing net loss by the weighted-average number of shares of common stock outstanding. We have outstanding stock options, restricted stock units and ESPPs and unvested common stock subject to repurchase which we include in the calculation of diluted net loss per share if their effect would be dilutive. The diluted net loss per share is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. We use the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted net loss per share, if applicable since we expect to settle the principal amount of the outstanding 2019 Notes in cash. For more information about the 2019 Notes, please refer to Note 7 . |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards In February 2016, the Financial Accounting Standards Board, or FASB, issued guidance on leases. This standard requires recognizing a right-of-use asset and lease liability on the balance sheet for all leases. It 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 standard is effective for interim and annual reporting periods beginning after December 15, 2018. We adopted this standard on January 1, 2019 using the effective-date modified retrospective transition method and elected the available practical expedients permitted under the transition method, allowing us to carryforward our historical assessments of (1) whether contracts are or contain leases, (2) lease classification, and (3) initial direct costs. Upon adopting this standard, we recorded net operating lease ROU assets and lease liabilities In June 2018, the FASB issued guidance to improve nonemployee share-based payment accounting that requires companies to account for share-based payments granted to nonemployees similar to share-based payments granted to employees. This guidance is effective for fiscal years beginning after December 15, 2018, including the interim periods within those fiscal years. We adopted this standard on January 1, 2019 and the adoption of this guidance In August 2018, the FASB issued guidance to align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This guidance is effective for fiscal years beginning after December 15, 2019, including the interim periods within those fiscal years. Early adoption of this guidance is permitted. We early adopted this guidance prospectively on January 1, 2019 and the adoption of this guidance did not impact our financial positions, results of operations or cash flows. In December 2019, the FASB issued guidance to improve areas of GAAP by removing certain exceptions permitted by Topic 740 - Income Taxes and clarifying existing guidance to facilitate consistent application. Early adoption of the new standard is permitted. We early adopted this guidance prospectively on January 1, 2019. Since we have incurred net losses since our inception and maintained a full valuation allowance on our net deferred tax assets, the adoption did not have a material impact on our financial positions, results of operations and cash flows, or financial statement disclosures. |
Recently Issued Accounting Standards Not Yet Adopted | Recently Issued Accounting Standards Not Yet Adopted In June 2016, the FASB issued guidance on measuring credit losses on financial instruments. This guidance requires measuring and recognizing expected credit losses for financial assets held at amortized cost. This guidance is effective for interim and annual reporting periods beginning after December 15, 2019, and early adoption is permitted. We will adopt this guidance on January 1, 2020. 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. While we continue to assess all potential impacts of this new standard, Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not have, or are not expected to have, a material impact on our present or future consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of Revenue and Accounts Receivable Concentration | The following table presents total revenue Year Ended December 31, 2019 2018 2017 Revenue: Avery Dennison 19 % 22 % 18 % North American Systems customer 14 * * Smartrac 12 17 14 Arizon * 10 13 Blue Star * * 10 45 % 49 % 55 % * Less than 10% As of December 31, 2019 2018 Accounts Receivable: Blue Star 18 % 13 % Avery Dennison 15 14 Smartrac 13 21 Arizon * 10 46 % 58 % * Less than 10% |
Summary of Allowance for Sales Returns | The following table Balance at Beginning of Year Additional Reserve Applied Sales Return and Price Exceptions Balance at End of Year Allowance for sales returns and price exceptions: During year ended December 31, 2019 $ 373 $ 2,939 $ (2,240 ) $ 1,072 During year ended December 31, 2018 3,495 1,426 (4,548 ) 373 During year ended December 31, 2017 177 4,166 (848 ) 3,495 |
Schedule of Property and Equipment Estimated Useful Lives | We record p roperty and equipment at cost and depreciate it using the straight-line method over the estimated useful lives of the related assets. The useful lives are as follows: Category Useful Life Laboratory equipment 3 to 10 years Computer equipment and software 2 to 5 years Furniture and fixtures 3 to 7 years Equipment acquired under finance leases 3 to 7 years Leasehold improvements Shorter of remaining lease term or expected useful life |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets Measured at Fair Value on Recurring Basis | The following table December 31, 2019 December 31, 2018 Level 1 Level 2 Total Level 1 Level 2 Total Cash equivalents: Money market funds $ 45,663 $ — $ 45,663 $ 11,896 $ — $ 11,896 Total cash equivalents 45,663 — 45,663 11,896 — 11,896 Short-term investments: U.S. government agency securities — 32,323 32,323 — 7,482 7,482 Corporate notes and bonds — 13,305 13,305 — 3,736 3,736 Commercial paper — 3,969 3,969 — 9,943 9,943 Treasury bills — — — — 17,382 17,382 Total short-term investments — 49,597 49,597 — 38,543 38,543 Total $ 45,663 $ 49,597 $ 95,260 $ 11,896 $ 38,543 $ 50,439 |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | The following table December 31, 2019 December 31, 2018 Raw materials $ 5,579 $ 3,858 Work-in-process 7,485 13,671 Finished goods 21,089 27,196 Total inventory $ 34,153 $ 44,725 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property and Equipment | The following table December 31, 2019 December 31, 2018 Laboratory equipment $ 15,326 $ 14,505 Computer equipment and software 4,927 4,626 Furniture and fixtures 1,138 1,138 Equipment acquired under finance leases 3,461 3,972 Leasehold improvements 10,554 10,551 Total property and equipment, gross 35,406 34,792 Less: Accumulated depreciation (17,964 ) (15,014 ) Total property and equipment, net $ 17,442 $ 19,778 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Summary of Components of Income (Loss) before Income Taxes | The Year Ended December 31, 2019 2018 2017 U.S. $ (23,291 ) $ (35,933 ) $ (17,761 ) Foreign 502 469 342 Loss before income taxes $ (22,789 ) $ (35,464 ) $ (17,419 ) |
Summary of Income Tax Expense | The following table presents the detail of income tax benefit (expense) for the periods presented (in thousands): Year Ended December 31, 2019 2018 2017 Current: U.S. - Federal $ — $ — $ — U.S. - State (36 ) (23 ) (8 ) Foreign (150 ) (140 ) (126 ) (186 ) (163 ) (134 ) Deferred: U.S. - Federal (11 ) 404 241 U.S. - State (1 ) (8 ) (10 ) Foreign — — — (12 ) 396 231 Total income tax benefit (expense) $ (198 ) $ 233 $ 97 |
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, 2019 2018 2017 U.S. Statutory Rate 21.0 % 21.0 % 34.0 % Change in valuation allowance (22.9 ) (20.6 ) 56.4 State taxes (net of federal benefit) (0.4 ) 0.5 1.9 Federal research and development credit 5.9 4.1 7.1 Incentive stock options (1.9 ) (2.9 ) 12.5 Unrecognized tax benefits (1.2 ) (1.0 ) (3.5 ) Impact of Tax Cuts and Jobs Act of 2017 — — (113.5 ) Return to provision - deductible transaction costs — — 5.6 Other, net (1.4 ) (0.4 ) 0.1 Effective income tax rate (0.9 %) 0.7 % 0.6 % |
Summary of Significant Components Deferred Tax Assets and Liabilities | 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 significant components of our deferred tax assets and liabilities as of the dates presented (in thousands): December 31, 2019 December 31, 2018 Net operating loss carryforwards $ 38,391 $ 34,279 Credit carryforwards 9,083 8,071 Capitalized research and development 2,235 2,969 Deferred rent — 1,021 Operating lease liabilities 4,830 — Allowances 1,694 1,309 Deferred compensation 176 230 Deferred revenue 46 40 Stock-based compensation 2,846 1,340 Other 156 108 Deferred tax assets 59,457 49,367 Less: Valuation allowance (46,602 ) (48,481 ) Net deferred tax assets 12,855 886 Deferred tax liability: Goodwill (645 ) (590 ) Depreciation and amortization (1,716 ) (433 ) Operating lease ROU assets (3,576 ) — 2019 Notes (7,066 ) — Deferred tax liabilities (13,003 ) (1,023 ) Net deferred tax liability $ (148 ) $ (137 ) |
Total Balance of Unrecognized Tax Benefits | The following table presents the total balance of unrecognized tax benefits as of the dates presented (in thousands): Year Ended December 31, 2019 2018 2017 Balance at beginning of period $ 3,159 $ 2,906 $ 2,597 Gross increase to tax positions in prior periods — — 2 Gross increase to tax positions in current periods 269 253 307 Balance at end of period $ 3,428 $ 3,159 $ 2,906 |
Long-term Debt (Tables)
Long-term Debt (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Summary of Outstanding Principal Amount And Carrying Value | The December 31, 2019 Outstanding principal amount 86,250 Unamortized debt discount and debt issuance costs (35,374 ) Carrying value 50,876 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Statement Of Stockholders Equity [Abstract] | |
Summary of Shares of Common Stock Reserved for Future Issuance | The following shares of common stock December 31, 2019 Option awards outstanding 3,262 Restricted stock units outstanding 761 Common stock reserved under equity incentive plans 1,246 Common stock reserved under employee stock purchase plan 490 Total 5,759 |
Stock-Based Awards (Tables)
Stock-Based Awards (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Stock Option Activity | The following table summarizes Number of Shares Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Life (Years) Total Intrinsic Value Outstanding at December 31, 2018 3,603 $ 17.67 8.43 $ 7,898 Granted 571 31.09 Exercised (508 ) 12.35 Forfeited or expired (404 ) 18.87 Outstanding at December 31, 2019 3,262 20.70 7.98 22,033 Vested and exercisable at December 31, 2019 1,416 $ 16.39 7.00 $ 14,345 |
Schedule of Stock Options Valuation Assumptions | We estimate t he fair value of options granted at the date of grant using the Black-Scholes option-pricing model with the following assumptions for the periods presented: Year Ended December 31, 2019 2018 2017 Risk-free interest rate 1.4% – 2.6% 2.3% – 3.1% 1.8% – 2.2% Expected dividends yield None None None Expected volatility 60.8% - 64.3% 57.7% - 66.1% 52.2% – 59.1% Weighted-average expected term 6.08 6.04 6.08 Weighted-average fair value of options granted $ 18.31 $ 11.85 $ 19.15 |
Schedule of Employee Stock Purchase Plan Valuation Assumptions | We he fair value of the ESPP granted at the start of the offering period using the Black-Scholes option-pricing model with the following assumptions for the periods presented: Year Ended December 31, 2019 2018 2017 Risk-free interest rate 1.9% – 2.5% 2.4% 0.7% – 1.1% Expected term 0.5 years 0.3 years 0.5 years Expected volatility 66.5% – 72.3% 75.9% 66.5% – 71.2% |
Summary of Stock-Based Compensation Expense | The following table Year Ended December 31, 2019 2018 2017 Cost of revenue $ 772 $ 469 $ 231 Research and development expense 6,427 3,663 2,431 Sales and marketing expense 6,003 4,166 3,113 General and administrative expense 5,284 3,019 1,653 Total stock-based compensation expense $ 18,486 $ 11,317 $ 7,428 |
Restricted Stock Units | |
Summary of Restricted Stock Units | The following table summarizes Number of Shares Weighted-Average Grant Date Fair Value RSUs PSUs RSUs PSUs Outstanding at December 31, 2018 32 — $ 20.21 $ — Granted 533 267 33.60 17.84 Vested (44 ) — 21.52 — Forfeited (12 ) (15 ) 34.58 17.03 Outstanding at December 31, 2019 509 252 $ 33.77 $ 17.88 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Components of Lease Expense | The following table presents the components of lease expense Year Ended December 31, 2019 Operating lease costs (a) Single lease costs $ 4,170 Variable lease costs 1,623 Sublease income (b) (1,796 ) Total operating lease costs $ 3,997 Finance lease costs: Amortization of right-of-use assets 433 Interest on lease liabilities 51 Total finance lease costs 484 (a) Includes short-term lease costs, which are immaterial. (b) Sublease income is related to unused office space that was sublet as part of the restructuring in fiscal 2018 where we continue to be the primary obligor for the lease. |
Supplemental Cash Flow Information Related to Leases | The following table Year Ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows used in operating leases $ 4,617 Operating cash flows used in finance leases 51 Financing cash flows used in finance leases 522 |
Schedule of Weighted-Average Remaining Lease Terms and Weighted-Average Discount Rate Related to Leases | The following table December 31, 2019 Weighted-average remaining lease term (years) Operating leases 6.1 Finance leases 0.7 Weighted-average discount rate Operating leases 6.8 % Finance leases 10.1 % |
Schedule of Future Lease Payments under Operating Leases | The following table presents future lease payments Operating Leases Finance Leases Lease Payments Sublease Income Net Lease Payments 2020 $ 4,755 $ (1,373 ) $ 3,382 $ 269 2021 4,790 (1,414 ) 3,376 1 2022 4,650 (1,457 ) 3,193 — 2023 3,263 (123 ) 3,140 — 2024 3,219 — 3,219 — Thereafter 6,728 — 6,728 — Total lease payments $ 27,405 $ (4,367 ) $ 23,038 $ 270 Less: Imputed interest (5,118 ) (11 ) Present value of lease liabilities 22,287 259 Less: Current portion of lease liabilities (3,380 ) (258 ) Lease liabilities, net of current portion $ 18,907 $ 1 |
Schedule of Future Minimum Lease Payments under Operating and Capital Leases | The following table Operating Leases Capital Leases 2019 $ 3,573 $ 575 2020 3,340 270 2021 3,305 — 2022 3,193 — 2023 3,140 — Thereafter 9,947 — Total minimum lease payments $ 26,498 $ 845 Less: Imputed interest (64 ) Present value of capital lease obligations 781 Less: Current portion of capital lease obligations (523 ) Capital lease obligations net of current portion $ 258 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring And Related Activities [Abstract] | |
Summary of Restructuring Activity | The following table Employee Termination Benefits Cease-Use Costs Total Balance at December 31, 2018 $ 94 $ 975 $ 1,069 Effect of the new lease standard adoption ( 1) — (975 ) (975 ) Balance at December 31, 2019 $ 94 $ — $ 94 (1) |
Deferred Revenue (Tables)
Deferred Revenue (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Revenue Disclosure [Abstract] | |
Summary of Changes in Deferred Revenue | The following table Year Ended December 31, 2019 2018 Balance at beginning of period $ 834 $ 1,215 Deferral of revenue 718 587 Recognition of deferred revenue (788 ) (968 ) Balance at end of period $ 764 $ 834 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Summary of Revenue Categories | The following table presents our revenue categories for the periods presented (in thousands): Year Ended December 31, 2019 2018 2017 Revenue: Endpoint ICs $ 97,657 $ 84,974 $ 91,699 Systems 55,179 37,659 33,601 Total revenue $ 152,836 $ 122,633 $ 125,300 |
Summary of Sales by Geography | The following table Year Ended December 31, 2019 2018 2017 Americas $ 53,260 $ 30,636 $ 29,656 Asia Pacific 89,012 79,290 80,531 Europe, Middle East and Africa 10,564 12,707 15,113 Total revenue $ 152,836 $ 122,633 $ 125,300 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Reconciliation of the Numerator and Denominator used in Computing Basic and Diluted Net Loss Per Share | For the periods presented, the following table Year Ended December 31, 2019 2018 2017 Numerator: Net loss $ (22,987 ) $ (35,231 ) $ (17,322 ) Denominator: Weighted-average shares outstanding — basic and diluted 21,847 21,334 20,680 Net loss per share — basic and diluted $ (1.05 ) $ (1.65 ) $ (0.84 ) |
Computation of Diluted Net Loss Per Share Effect in Antidilutive | The following outstanding options and restricted stock units and unvested shares excluded from the computation of diluted net loss per share Year Ended December 31, 2019 2018 2017 Stock options and restricted stock units 3,908 3,284 2,911 Unvested shares of common stock subject to repurchase 3 20 48 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Schedule of Revenue and Accounts Receivable Concentration (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Customer Concentration Risk | Revenue | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 45.00% | 49.00% | 55.00% |
Customer Concentration Risk | Revenue | Avery Dennison | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 19.00% | 22.00% | 18.00% |
Customer Concentration Risk | Revenue | North American Systems Customer | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 14.00% | ||
Customer Concentration Risk | Revenue | Smartrac | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 12.00% | 17.00% | 14.00% |
Customer Concentration Risk | Revenue | Arizon | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 10.00% | 13.00% | |
Customer Concentration Risk | Revenue | Blue Star | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 10.00% | ||
Credit Concentration Risk | Accounts Receivable | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 46.00% | 58.00% | |
Credit Concentration Risk | Accounts Receivable | Avery Dennison | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 15.00% | 14.00% | |
Credit Concentration Risk | Accounts Receivable | Smartrac | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 13.00% | 21.00% | |
Credit Concentration Risk | Accounts Receivable | Arizon | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 10.00% | ||
Credit Concentration Risk | Accounts Receivable | Blue Star | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 18.00% | 13.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Jan. 01, 2019 | Dec. 31, 2017 | Dec. 31, 2016 | |
Significant Accounting Policies [Line Items] | |||||
Inventory excess and obsolescence charges, unfavorable impact on gross margin percentage | 1.70% | 1.20% | |||
Sales commissions maximum amortization period | 1 year | ||||
Sales contracts with original expected length | one year or less | ||||
Cumulative ownership change percentage | 50.00% | ||||
Cumulative change in ownership period | 3 years | ||||
Income tax examination years, description | Due to the presence of NOLs in most jurisdictions, our tax years remain open for examination by taxing authorities back to 2000 | ||||
Award vesting period | 4 years | ||||
Operating lease right-of-use assets | $ 16,501 | $ 18,700 | |||
Operating lease, liability | 22,287 | $ 25,300 | |||
Restructuring liabilities, net | 94 | $ 1,069 | |||
Deferred rent, net | 5,600 | ||||
Cease-Use Costs | |||||
Significant Accounting Policies [Line Items] | |||||
Restructuring liabilities, net | $ 1,000 | ||||
Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Expected revenue recognition term | 1 year | ||||
Extended warranty and enhanced maintenance term | 3 years | ||||
Payment Terms | 120 days | ||||
Product warranty coverage period | 1 year | ||||
Lease expiration year | 2026 | ||||
Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Extended warranty and enhanced maintenance term | 1 year | ||||
Payment Terms | 30 days | ||||
Product warranty coverage period | 90 days | ||||
Lease expiration year | 2020 | ||||
Allowance for Sales Returns | |||||
Significant Accounting Policies [Line Items] | |||||
Amount reserved for sales returns | $ 1,072 | $ 373 | $ 3,495 | $ 177 | |
Allowance for Sales Returns | Customer One | |||||
Significant Accounting Policies [Line Items] | |||||
Amount reserved for sales returns | $ 3,200 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Summary of Allowance for Sales Returns (Details) - Allowance for Sales Returns and Price Exceptions - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Valuation And Qualifying Accounts Disclosure [Line Items] | |||
Balance at Beginning of Year | $ 373 | $ 3,495 | $ 177 |
Additional Reserve | 2,939 | 1,426 | 4,166 |
Applied Sales Return and Price Exceptions | (2,240) | (4,548) | (848) |
Balance at End of Year | $ 1,072 | $ 373 | $ 3,495 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Schedule of Property and Equipment Estimated Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Leasehold Improvements | |
Property Plant And Equipment [Line Items] | |
Property and equipment, estimated useful lives | Shorter of remaining lease term or expected useful life |
Minimum | Laboratory Equipment | |
Property Plant And Equipment [Line Items] | |
Property and equipment, estimated useful lives (Years) | 3 years |
Minimum | Computer Equipment and Software | |
Property Plant And Equipment [Line Items] | |
Property and equipment, estimated useful lives (Years) | 2 years |
Minimum | Furniture and Fixtures | |
Property Plant And Equipment [Line Items] | |
Property and equipment, estimated useful lives (Years) | 3 years |
Minimum | Equipment Acquired Under Finance Leases | |
Property Plant And Equipment [Line Items] | |
Property and equipment, estimated useful lives (Years) | 3 years |
Maximum | Laboratory Equipment | |
Property Plant And Equipment [Line Items] | |
Property and equipment, estimated useful lives (Years) | 10 years |
Maximum | Computer Equipment and Software | |
Property Plant And Equipment [Line Items] | |
Property and equipment, estimated useful lives (Years) | 5 years |
Maximum | Furniture and Fixtures | |
Property Plant And Equipment [Line Items] | |
Property and equipment, estimated useful lives (Years) | 7 years |
Maximum | Equipment Acquired Under Finance Leases | |
Property Plant And Equipment [Line Items] | |
Property and equipment, estimated useful lives (Years) | 7 years |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Assets Measured at Fair Value on Recurring Basis (Details) - Fair Value Measurements Recurring - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 95,260 | $ 50,439 |
Cash Equivalents | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 45,663 | 11,896 |
Cash Equivalents | Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 45,663 | 11,896 |
Short-term Investments | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 49,597 | 38,543 |
Short-term Investments | U.S. Government Agency Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 32,323 | 7,482 |
Short-term Investments | Corporate Notes and Bonds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 13,305 | 3,736 |
Short-term Investments | Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 3,969 | 9,943 |
Short-term Investments | Treasury Bills | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 17,382 | |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 45,663 | 11,896 |
Level 1 | Cash Equivalents | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 45,663 | 11,896 |
Level 1 | Cash Equivalents | Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 45,663 | 11,896 |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 49,597 | 38,543 |
Level 2 | Short-term Investments | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 49,597 | 38,543 |
Level 2 | Short-term Investments | U.S. Government Agency Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 32,323 | 7,482 |
Level 2 | Short-term Investments | Corporate Notes and Bonds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 13,305 | 3,736 |
Level 2 | Short-term Investments | Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 3,969 | 9,943 |
Level 2 | Short-term Investments | Treasury Bills | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 17,382 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
2019 Convertible Senior Notes due 2026 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Debt instrument, maturity year | 2026 | |
Fair Value Measurements Recurring | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 95,260 | $ 50,439 |
Liabilities measured at fair value | 0 | 0 |
Fair Value Measurements Recurring | Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 0 | $ 0 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 5,579 | $ 3,858 |
Work-in-process | 7,485 | 13,671 |
Finished goods | 21,089 | 27,196 |
Total inventory | $ 34,153 | $ 44,725 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Property Plant And Equipment [Line Items] | ||
Total property and equipment, gross | $ 35,406 | $ 34,792 |
Less: Accumulated depreciation | (17,964) | (15,014) |
Total property and equipment, net | 17,442 | 19,778 |
Laboratory Equipment | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment, gross | 15,326 | 14,505 |
Computer Equipment and Software | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment, gross | 4,927 | 4,626 |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment, gross | 1,138 | 1,138 |
Equipment Acquired Under Finance Leases | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment, gross | 3,461 | 3,972 |
Total property and equipment, net | 700 | 1,100 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment, gross | $ 10,554 | $ 10,551 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property Plant And Equipment [Line Items] | |||
Depreciation | $ 4,809 | $ 4,534 | $ 3,950 |
Property and equipment, net | 17,442 | 19,778 | |
Equipment Acquired Under Finance Leases | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, net | $ 700 | $ 1,100 |
Income Taxes - Summary of Compo
Income Taxes - Summary of Components of Income (Loss) before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
U.S. | $ (23,291) | $ (35,933) | $ (17,761) |
Foreign | 502 | 469 | 342 |
Loss before income taxes | $ (22,789) | $ (35,464) | $ (17,419) |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income Tax Benefit (Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | |||
U.S. - State | $ (36) | $ (23) | $ (8) |
Foreign | (150) | (140) | (126) |
Total current | (186) | (163) | (134) |
Deferred: | |||
U.S. - Federal | (11) | 404 | 241 |
U.S. - State | (1) | (8) | (10) |
Total deferred | (12) | 396 | 231 |
Total income tax benefit (expense) | $ (198) | $ 233 | $ 97 |
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, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
U.S. Statutory Rate | 21.00% | 21.00% | 34.00% |
Change in valuation allowance | (22.90%) | (20.60%) | 56.40% |
State taxes (net of federal benefit) | (0.40%) | 0.50% | 1.90% |
Federal research and development credit | 5.90% | 4.10% | 7.10% |
Incentive stock options | (1.90%) | (2.90%) | 12.50% |
Unrecognized tax benefits | (1.20%) | (1.00%) | (3.50%) |
Impact of Tax Cuts and Jobs Act of 2017 | (1.135) | ||
Return to provision - deductible transaction costs | 5.60% | ||
Other, net | (1.40%) | (0.40%) | 0.10% |
Effective income tax rate | (0.90%) | 0.70% | 0.60% |
Income Taxes - Summary of Signi
Income Taxes - Summary of Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforwards | $ 38,391 | $ 34,279 |
Credit carryforwards | 9,083 | 8,071 |
Capitalized research and development | 2,235 | 2,969 |
Deferred rent | 1,021 | |
Operating lease liabilities | 4,830 | |
Allowances | 1,694 | 1,309 |
Deferred compensation | 176 | 230 |
Deferred revenue | 46 | 40 |
Stock-based compensation | 2,846 | 1,340 |
Other | 156 | 108 |
Deferred tax assets | 59,457 | 49,367 |
Less: Valuation allowance | (46,602) | (48,481) |
Net deferred tax assets | 12,855 | 886 |
Deferred tax liability: | ||
Goodwill | (645) | (590) |
Depreciation and amortization | (1,716) | (433) |
Operating lease ROU assets | (3,576) | |
2019 Notes | (7,066) | |
Deferred tax liabilities | (13,003) | (1,023) |
Net deferred tax liability | $ (148) | $ (137) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Accumulated federal tax losses | $ 179,100,000 | $ 159,500,000 | ||
Accumulated federal tax losses with indefinite life | 50,400,000 | |||
Accumulated state tax losses | 23,800,000 | 23,800,000 | ||
Research and development credit carry-forwards | $ 12,000,000 | 10,600,000 | ||
Federal tax losses and research and development credit carryforward expiration year | 2020 | |||
Unrecognized tax benefits | $ 3,428,000 | $ 3,159,000 | $ 2,906,000 | $ 2,597,000 |
Accrued interest and penalties related to unrecognized tax benefits | 0 | |||
Unrecognized tax benefits, if recognized would impact the effective tax rate | $ 0 |
Income Taxes - Total Balance of
Income Taxes - Total Balance of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Balance at beginning of period | $ 3,159 | $ 2,906 | $ 2,597 |
Gross increase to tax positions in prior periods | 2 | ||
Gross increase to tax positions in current periods | 269 | 253 | 307 |
Balance at end of period | $ 3,428 | $ 3,159 | $ 2,906 |
Long-term Debt - Convertible Se
Long-term Debt - Convertible Senior Notes - Additional Information (Details) $ / shares in Units, $ in Thousands | Dec. 11, 2019$ / shares | Dec. 31, 2019USD ($)d$ / sharesshares | Dec. 31, 2019USD ($)$ / shares |
Debt Instrument [Line Items] | |||
Net proceeds from issuing notes | $ 83,475 | ||
Debt instrument, threshold trading days | d | 5 | ||
Number of business day | d | 5 | ||
Adjustments recorded in additional paid-in capital | 32,743 | ||
Payment for capped call transactions | $ 10,100 | 10,126 | |
2019 Convertible Senior Notes due 2026 | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount | $ 86,300 | $ 86,300 | |
Debt instrument, Interest rate | 2.00% | 2.00% | |
Debt instrument, maturity date | Dec. 15, 2026 | ||
Debt Instrument, frequency of periodic payment | The 2019 Notes bear interest at a fixed rate of 2.00% per year, payable semi-annually in arrears on June 15 and December 15 of each year, beginning on June 15, 2020. | ||
Net proceeds from issuing notes | $ 83,500 | ||
Debt instrument convertible common stock conversion shares per 1000 principal amount of notes | shares | 28.9415 | ||
Debt instrument, initial conversion ratio | 0.0289415 | ||
Debt instrument, initial conversion price | $ / shares | $ 34.55 | $ 34.55 | |
Debt instrument, threshold consecutive trading days | d | 30 | ||
Debt instrument, threshold percentage of stock price trigger | 130.00% | ||
Debt instrument, terms of conversion feature | On or after September 15, 2026, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of the 2019 Notes, in multiples of $1,000 principal amount, at the option of the holder regardless of the foregoing circumstances. | ||
Percentage of repurchase price of principal amount | 100.00% | ||
Debt instrument, borrowing interest rate percentage | 9.90% | 9.90% | |
Fair value of liability component upon issuance | $ 52,500 | $ 52,500 | |
Initial carrying amount of liability component recognized as debt discount | 33,800 | 33,800 | |
Proceeds from convertible debt | 86,300 | ||
Adjustments recorded in additional paid-in capital | 33,800 | ||
Total issuance cost allocated between liability and equity | 2,800 | ||
Liability issuance costs | 1,700 | ||
Equity issuance costs | $ 1,100 | ||
Effective interest rate on the liability component | 10.21% | ||
Cap price of the capped call transactions | $ / shares | $ 54.20 | ||
Premium percentage on sale price of common stock | 100.00% | ||
Common stock sale price per share last reported | $ / shares | $ 27.10 | ||
Capped call transactions expiration consecutive days | d | 40 | ||
Capped call transaction expiring date | Dec. 11, 2026 | ||
2019 Convertible Senior Notes due 2026 | Level 2 | |||
Debt Instrument [Line Items] | |||
Estimated fair value | $ 87,000 | $ 87,000 | |
2019 Convertible Senior Notes due 2026 | Minimum | |||
Debt Instrument [Line Items] | |||
Debt instrument, threshold trading days | d | 20 | ||
2019 Convertible Senior Notes due 2026 | Maximum | |||
Debt Instrument [Line Items] | |||
Debt instrument, threshold percentage of stock price trigger | 98.00% |
Long-term Debt - Summary of Out
Long-term Debt - Summary of Outstanding Principal Amount And Carrying Value (Details) - 2019 Convertible Senior Notes due 2026 $ in Thousands | Dec. 31, 2019USD ($) |
Debt Instrument [Line Items] | |
Outstanding principal amount | $ 86,250 |
Unamortized debt discount and debt issuance costs | (35,374) |
Carrying value | $ 50,876 |
Long-term Debt - Senior Credit
Long-term Debt - Senior Credit Facility - Additional Information (Details) - USD ($) | Dec. 16, 2019 | Apr. 26, 2019 | Dec. 31, 2019 |
Line Of Credit Facility [Line Items] | |||
Net proceeds from repayment of senior credit facility | $ 24,000,000 | ||
Loss on debt extinguishment | 576,000 | $ 576,000 | |
Prepayment penalty | 470,000 | ||
Write-off of unamortized debt issuance costs | $ 106,000 | ||
Term Loan | |||
Line Of Credit Facility [Line Items] | |||
Line of credit facility, mature date | Apr. 1, 2023 | ||
Term loan | $ 23,500,000 | ||
Line of credit facility, amortization period | 36 months | ||
Line of credit facility, initial interest-only period | 12 months | ||
Line of credit facility, beginning date | May 1, 2020 | ||
Term Loan | Term Loan Prepaid On or Before April 26, 2020 | |||
Line Of Credit Facility [Line Items] | |||
Percentage of prepayment fee | 2.00% | ||
Term Loan | Term Loan Prepaid After April 26, 2020, But On or Before April 26, 2021 | |||
Line Of Credit Facility [Line Items] | |||
Percentage of prepayment fee | 1.00% | ||
Revolving Credit Facility | |||
Line Of Credit Facility [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 25,000,000 | ||
Revolving Credit Facility | Term Loan | |||
Line Of Credit Facility [Line Items] | |||
Line of credit facility, mature date | May 1, 2021 | ||
Letter of Credit | |||
Line Of Credit Facility [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 5,000,000 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Stockholders Equity Note [Abstract] | ||
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, shares authorized | 495,000,000 | 495,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, voting rights | Each holder of the common stock is entitled to one vote per common share |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Shares of Common Stock Reserved for Future Issuance (Details) shares in Thousands | Dec. 31, 2019shares |
Class Of Stock [Line Items] | |
Total shares of common stock reserved for future issuance | 5,759 |
Stock Options | |
Class Of Stock [Line Items] | |
Total shares of common stock reserved for future issuance | 3,262 |
Restricted Stock Units | |
Class Of Stock [Line Items] | |
Total shares of common stock reserved for future issuance | 761 |
Equity Incentive Plans | |
Class Of Stock [Line Items] | |
Total shares of common stock reserved for future issuance | 1,246 |
Employee Stock Purchase Plan | |
Class Of Stock [Line Items] | |
Total shares of common stock reserved for future issuance | 490 |
Stock-Based Awards - Additional
Stock-Based Awards - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
May 16, 2018 | Jul. 31, 2016 | Mar. 31, 2020 | Dec. 31, 2016 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Options granted, exercisable term | 4 years | |||||||
Exercise price of stock option | $ 17.33 | $ 31.09 | ||||||
Number of stock options granted in exchange for options eligible for exchange | 700,000 | 571,000 | ||||||
Stock based compensation expense | $ 18,486 | $ 11,317 | $ 7,428 | |||||
Stock Option Exchange Program | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Option exchange program commencement date | Apr. 18, 2018 | |||||||
Option exchange program expiration date | May 16, 2018 | |||||||
Eligible stock options tendered by employees | 1,000,000 | |||||||
Percentage of eligible stock options tendered by employees | 73.00% | |||||||
Stock Option Exchange Program | Minimum | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Exercise price of stock option | $ 21.72 | |||||||
Stock Option | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Total intrinsic value of options exercised | 10,000 | 4,300 | 14,900 | |||||
Total grant date fair value of options vested | 14,800 | 6,000 | $ 3,100 | |||||
Unrecognized stock-based compensation cost | $ 26,200 | |||||||
Unrecognized stock-based compensation cost, period for recognition | 2 years 7 months 6 days | |||||||
Performance Share Units | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Stock based compensation expense | $ 3,400 | |||||||
Unrecognized stock-based compensation cost | $ 900 | |||||||
Performance Share Units | Forecast | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Number of shares expected to vest upon achievement of financial metric | 239,000 | |||||||
Performance Share Units | Maximum | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Unrecognized stock-based compensation cost, period for recognition | 1 year | |||||||
Restricted Stock Units | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Unrecognized stock-based compensation cost | $ 15,300 | |||||||
Unrecognized stock-based compensation cost, period for recognition | 3 years 4 months 24 days | |||||||
Total fair value of RSUs vested | $ 1,500 | $ 1,500 | ||||||
2016 Equity Incentive Plan | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Incentive plan effective date | Jul. 31, 2016 | |||||||
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 lower of (1) 1,825,000 shares; (2) 5% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year; and (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 | Lower of Potential Outcome One | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Common stock capital incremental shares reserved for future issuance each year | 1,825,000 | |||||||
2016 Equity Incentive Plan | Lower 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 capital incremental shares reserved for future issuance each year | 365,411 | |||||||
Percentage of total number of shares of common stock outstanding | 1.00% | |||||||
Unrecognized stock-based compensation cost | $ 200 | |||||||
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% | |||||||
2016 Employee Stock Purchase Plan | Maximum | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Unrecognized stock-based compensation cost, period for recognition | 1 year |
Stock-Based Awards - Summary of
Stock-Based Awards - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |
May 16, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |||
Number of Shares, Outstanding, Beginning balance | 3,603 | ||
Number of Shares, Granted | 700 | 571 | |
Number of Shares, Exercised | (508) | ||
Number of Shares, Forfeited or expired | (404) | ||
Number of Shares, Outstanding, Ending balance | 3,262 | 3,603 | |
Number of Shares, Vested and exercisable | 1,416 | ||
Weighted-Average Exercise Price Per Share, Outstanding, Beginning balance | $ 17.67 | ||
Weighted-Average Exercise Price Per Share, Granted | $ 17.33 | 31.09 | |
Weighted-Average Exercise Price Per Share, Exercised | 12.35 | ||
Weighted-Average Exercise Price Per Share, Forfeited or Expired | 18.87 | ||
Weighted-Average Exercise Price Per Share, Outstanding, Ending balance | 20.70 | $ 17.67 | |
Weighted-Average Exercise Price Per Share, Vested and exercisable | $ 16.39 | ||
Weighted-Average Remaining Contractual Life (Years), Outstanding | 7 years 11 months 23 days | 8 years 5 months 4 days | |
Weighted-Average Remaining Contractual Life (Years), Vested and exercisable | 7 years | ||
Total Intrinsic Value, Outstanding | $ 22,033 | $ 7,898 | |
Total Intrinsic Value, Vested and exercisable | $ 14,345 |
Stock-Based Awards - Schedule o
Stock-Based Awards - Schedule of Stock Options Valuation Assumptions (Details) - Stock Options - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Risk-free interest rates, minimum | 1.40% | 2.30% | 1.80% |
Risk-free interest rates, maximum | 2.60% | 3.10% | 2.20% |
Expected dividends yield | 0.00% | 0.00% | 0.00% |
Volatility, minimum | 60.80% | 57.70% | 52.20% |
Volatility, maximum | 64.30% | 66.10% | 59.10% |
Weighted-average expected term | 6 years 29 days | 6 years 14 days | 6 years 29 days |
Weighted-average fair value of options granted | $ 18.31 | $ 11.85 | $ 19.15 |
Stock-Based Awards - Summary _2
Stock-Based Awards - Summary of Restricted Stock Units (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Restricted Stock Units | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of Shares Outstanding, Balance | shares | 32 |
Number of Shares, Granted | shares | 533 |
Number of Shares, Vested | shares | (44) |
Number of Shares, Forfeited | shares | (12) |
Number of Shares Outstanding, Balance | shares | 509 |
Weighted-Average Grant-Date Fair Value , Beginning balance | $ / shares | $ 20.21 |
Weighted-Average Grant-Date Fair Value , Granted | $ / shares | 33.60 |
Weighted-Average Exercise Price Per Share, Vested | $ / shares | 21.52 |
Weighted-Average Exercise Price Per Share, Forfeited | $ / shares | 34.58 |
Weighted-Average Grant-Date Fair Value , Ending balance | $ / shares | $ 33.77 |
Performance Share Units | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of Shares, Granted | shares | 267 |
Number of Shares, Forfeited | shares | (15) |
Number of Shares Outstanding, Balance | shares | 252 |
Weighted-Average Grant-Date Fair Value , Granted | $ / shares | $ 17.84 |
Weighted-Average Exercise Price Per Share, Forfeited | $ / shares | 17.03 |
Weighted-Average Grant-Date Fair Value , Ending balance | $ / shares | $ 17.88 |
Stock-Based Awards - Schedule_2
Stock-Based Awards - Schedule of Employee Stock Purchase Plan Valuation Assumptions (Details) - Employee Stock Purchase Plan | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Risk-free interest rate | 2.40% | ||
Risk-free interest rates, minimum | 1.90% | 0.70% | |
Risk-free interest rates, maximum | 2.50% | 1.10% | |
Expected term | 6 months | 3 months 18 days | 6 months |
Expected volatility | 75.90% | ||
Volatility, minimum | 66.50% | 66.50% | |
Volatility, maximum | 72.30% | 71.20% |
Stock-Based Awards - Summary _3
Stock-Based Awards - Summary of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Total stock-based compensation expense | $ 18,486 | $ 11,317 | $ 7,428 |
Cost of Revenue | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Total stock-based compensation expense | 772 | 469 | 231 |
Research and Development Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Total stock-based compensation expense | 6,427 | 3,663 | 2,431 |
Selling and Marketing Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Total stock-based compensation expense | 6,003 | 4,166 | 3,113 |
General and Administrative Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Total stock-based compensation expense | $ 5,284 | $ 3,019 | $ 1,653 |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Operating lease costs | |
Single lease costs | $ 4,170 |
Variable lease costs | 1,623 |
Sublease income: | |
Sublease income | (1,796) |
Total operating lease costs | 3,997 |
Finance lease costs: | |
Amortization of right-of-use assets | 433 |
Interest on lease liabilities | 51 |
Total finance lease costs | $ 484 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information Related to Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash paid for amounts included in the measurement of lease liabilities | |||
Operating cash flows used in operating leases | $ 4,617 | ||
Operating cash flows used in finance leases | 51 | ||
Financing cash flows used in finance leases | $ 522 | $ 900 | $ 1,147 |
Leases - Schedule of Weighted-A
Leases - Schedule of Weighted-Average Remaining Lease Terms and Weighted-Average Discount Rate Related to Leases (Details) | Dec. 31, 2019 |
Weighted-average remaining lease term (years) | |
Operating leases | 6 years 1 month 6 days |
Finance leases | 8 months 12 days |
Weighted-average discount rate | |
Operating leases | 6.80% |
Finance leases | 10.10% |
Leases - Schedule of Future Lea
Leases - Schedule of Future Lease Payments under Operating Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Leases [Abstract] | |||
Operating Leases, Lease Payments, 2020 | $ 4,755 | ||
Operating Leases, Lease Payments, 2021 | 4,790 | ||
Operating Leases, Lease Payments, 2022 | 4,650 | ||
Operating Leases, Lease Payments, 2023 | 3,263 | ||
Operating Leases, Lease Payments, 2024 | 3,219 | ||
Operating Leases, Lease Payments, Thereafter | 6,728 | ||
Operating Leases, Lease Payments, Total lease payments | 27,405 | ||
Less: Imputed interest | (5,118) | ||
Present value of lease liabilities | 22,287 | $ 25,300 | |
Less: Current portion of lease liabilities | (3,380) | ||
Operating lease liabilities, net of current portion | 18,907 | ||
Operating Leases, Sublease Income, 2020 | (1,373) | ||
Operating Leases, Sublease Income, 2021 | (1,414) | ||
Operating Leases, Sublease Income, 2022 | (1,457) | ||
Operating Leases, Sublease Income, 2023 | (123) | ||
Operating Leases, Sublease Income, Total lease payments | (4,367) | ||
Operating Leases, Net, 2020 | 3,382 | ||
Operating Leases, Net, 2021 | 3,376 | ||
Operating Leases, Net, 2022 | 3,193 | ||
Operating Leases, Net, 2023 | 3,140 | ||
Operating Leases, Net, 2024 | 3,219 | ||
Operating Leases, Net, Thereafter | 6,728 | ||
Operating Leases, Net, Total lease payments | 23,038 | ||
Finance Leases, Lease Payments, 2020 | 269 | ||
Finance Leases, Lease Payments, 2021 | 1 | ||
Finance Leases, Lease Payments, Total lease payments | 270 | ||
Less: Imputed interest | (11) | ||
Present value of lease liabilities | 259 | ||
Less: Current portion of lease liabilities | (258) | $ (523) | |
Finance lease liabilities, net of current portion | $ 1 | $ 258 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments Under Operating and Capital Leases (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Leases [Abstract] | |
Operating leases, 2019 | $ 3,573 |
Operating leases, 2020 | 3,340 |
Operating leases, 2021 | 3,305 |
Operating leases, 2022 | 3,193 |
Operating leases, 2023 | 3,140 |
Operating leases, Thereafter | 9,947 |
Operating leases, Total minimum lease payments | 26,498 |
Capital leases, 2019 | 575 |
Capital leases, 2020 | 270 |
Capital leases, Total minimum lease payments | 845 |
Less: Imputed interest | (64) |
Present value of capital lease obligations | 781 |
Less: Current portion of capital lease obligations | (523) |
Capital lease obligations net of current portion | $ 258 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | Dec. 31, 2019USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
Inventory purchase commitment, amount | $ 17.3 |
Restructuring - Additional Info
Restructuring - Additional Information (Details) - USD ($) $ in Thousands | Feb. 13, 2018 | Dec. 31, 2018 |
Restructuring And Related Activities [Abstract] | ||
Restructuring initiated date | Feb. 13, 2018 | |
Percentage of employee affected under reduction in force | 9.00% | |
Restructuring costs | $ 3,749 |
Restructuring - Summary of Rest
Restructuring - Summary of Restructuring Activity (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Restructuring Cost And Reserve [Line Items] | |
Balance at December 31, 2018 | $ 1,069 |
Balance at December 31, 2019 | 94 |
Accounting Standards Update 2016-02 | |
Restructuring Cost And Reserve [Line Items] | |
Effect of the new lease standard adoption | (975) |
Employee Termination Benefits | |
Restructuring Cost And Reserve [Line Items] | |
Balance at December 31, 2018 | 94 |
Balance at December 31, 2019 | 94 |
Employee Termination Benefits | Accounting Standards Update 2016-02 | |
Restructuring Cost And Reserve [Line Items] | |
Effect of the new lease standard adoption | 0 |
Cease-Use Costs | |
Restructuring Cost And Reserve [Line Items] | |
Balance at December 31, 2018 | 975 |
Balance at December 31, 2019 | 0 |
Cease-Use Costs | Accounting Standards Update 2016-02 | |
Restructuring Cost And Reserve [Line Items] | |
Effect of the new lease standard adoption | $ (975) |
Deferred Revenue - Summary of C
Deferred Revenue - Summary of Changes in Deferred Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred Revenue Disclosure [Abstract] | ||
Balance at beginning of period | $ 834 | $ 1,215 |
Deferral of revenue | 718 | 587 |
Recognition of deferred revenue | (788) | (968) |
Balance at end of period | $ 764 | $ 834 |
Deferred Revenue - Additional I
Deferred Revenue - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred Revenue Disclosure [Abstract] | ||
Recognition of deferred revenue | $ 0.6 | $ 0.9 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019USD ($)Segment | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Segment Reporting Information [Line Items] | |||
Number of reportable segments | Segment | 1 | ||
Number of operating segments | Segment | 1 | ||
Description of long-lived assets located | Substantially all our long-lived assets are located in the United States. | ||
Total revenue | $ 152,836 | $ 122,633 | $ 125,300 |
United States | |||
Segment Reporting Information [Line Items] | |||
Total revenue | 50,200 | 29,500 | 28,800 |
China (Including Hong Kong) | |||
Segment Reporting Information [Line Items] | |||
Total revenue | $ 70,800 | $ 64,300 | $ 68,000 |
Segment Reporting - Summary of
Segment Reporting - Summary of Sales by Product (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue: | |||
Total revenue | $ 152,836 | $ 122,633 | $ 125,300 |
Endpoint ICs | |||
Revenue: | |||
Total revenue | 97,657 | 84,974 | 91,699 |
Systems | |||
Revenue: | |||
Total revenue | $ 55,179 | $ 37,659 | $ 33,601 |
Segment Reporting - Summary o_2
Segment Reporting - Summary of Sales by Geography (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Segment Reporting Information [Line Items] | |||
Total revenue | $ 152,836 | $ 122,633 | $ 125,300 |
Americas | |||
Segment Reporting Information [Line Items] | |||
Total revenue | 53,260 | 30,636 | 29,656 |
Asia Pacific | |||
Segment Reporting Information [Line Items] | |||
Total revenue | 89,012 | 79,290 | 80,531 |
Europe, Middle East and Africa | |||
Segment Reporting Information [Line Items] | |||
Total revenue | $ 10,564 | $ 12,707 | $ 15,113 |
Net Loss Per Share - Reconcilia
Net Loss Per Share - Reconciliation of the Numerator and Denominator used in Computing Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Numerator: | |||
Net loss | $ (22,987) | $ (35,231) | $ (17,322) |
Denominator: | |||
Weighted-average shares outstanding — basic and diluted | 21,847 | 21,334 | 20,680 |
Net loss per share — basic and diluted | $ (1.05) | $ (1.65) | $ (0.84) |
Net Loss Per Share - Computatio
Net Loss Per Share - Computation of Diluted Net Loss Per Share Effect in Antidilutive (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock Options and Restricted Stock Units | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 3,908 | 3,284 | 2,911 |
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 | 3 | 20 | 48 |
Net Loss Per Share - Additional
Net Loss Per Share - Additional Information (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
2019 Convertible Senior Notes due 2026 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |
Debt instrument, conversion spread | shares | 0 |
Minimum | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |
Debt conversion average market price of stock per share | $ / shares | $ 34.55 |