Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | 9-May-14 | |
Document And Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Trading Symbol | 'PRSS | ' |
Entity Registrant Name | 'CAFEPRESS INC. | ' |
Entity Central Index Key | '0001117733 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Non-accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 17,238,079 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
CURRENT ASSETS: | ' | ' |
Cash and cash equivalents | $18,673 | $33,335 |
Short-term investments | 3,475 | 3,475 |
Accounts receivable | 5,500 | 8,310 |
Inventory | 8,210 | 9,493 |
Deferred costs | 2,964 | 2,721 |
Prepaid expenses and other current assets | 6,345 | 6,862 |
Total current assets | 45,167 | 64,196 |
Property and equipment, net | 20,521 | 21,964 |
Goodwill | 39,448 | 39,448 |
Intangible assets, net | 13,917 | 15,003 |
Other assets | 497 | 829 |
TOTAL ASSETS | 119,550 | 141,440 |
CURRENT LIABILITIES: | ' | ' |
Accounts payable | 13,260 | 23,073 |
Partner commissions payable | 3,184 | 5,210 |
Accrued royalties payable | 4,285 | 6,728 |
Accrued liabilities | 9,039 | 12,541 |
Deferred revenue | 4,922 | 5,045 |
Capital lease obligation, current | 588 | 579 |
Total current liabilities | 35,278 | 53,176 |
Capital lease obligation, non-current | 1,883 | 2,034 |
Other long-term liabilities | 2,831 | 2,576 |
TOTAL LIABILITIES | 39,992 | 57,786 |
Commitments and Contingencies | ' | ' |
Stockholders' Equity: | ' | ' |
Preferred stock, $0.0001 par value: 10,000 shares authorized as of March 31, 2014 and December 31, 2013; none issued and outstanding | ' | ' |
Common stock, $0.0001 par value - 500,000 shares authorized and 17,231 and 17,173 shares issued and outstanding as of March 31, 2014 and December 31, 2013, respectively | 2 | 2 |
Additional paid-in capital | 98,857 | 97,736 |
Accumulated deficit | -19,301 | -14,084 |
TOTAL STOCKHOLDERS' EQUITY | 79,558 | 83,654 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $119,550 | $141,440 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Per Share data, unless otherwise specified | ||
Statement Of Financial Position [Abstract] | ' | ' |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, share authorized | 10,000 | 10,000 |
Preferred stock, share issued | 0 | 0 |
Preferred stock, share outstanding | 0 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 500,000 | 500,000 |
Common stock, shares issued | 17,231 | 17,173 |
Common stock, shares outstanding | 17,231 | 17,173 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Income Statement [Abstract] | ' | ' |
Net revenues | $48,188 | $52,507 |
Cost of net revenues | 29,710 | 32,866 |
Gross profit | 18,478 | 19,641 |
Operating expenses: | ' | ' |
Sales and marketing | 13,433 | 14,307 |
Technology and development | 5,146 | 5,221 |
General and administrative | 4,911 | 4,587 |
Acquisition-related costs | -1,112 | 1,395 |
Restructuring | 747 | ' |
Total operating expenses | 23,125 | 25,510 |
Loss from operations | -4,647 | -5,869 |
Interest income | 3 | 11 |
Interest expense | -43 | -63 |
Other expense (income), net | -8 | -63 |
Loss before income taxes | -4,695 | -5,921 |
Provision for (benefit from) income taxes | 522 | -1,937 |
Net loss | ($5,217) | ($3,984) |
Net loss per share of common stock: | ' | ' |
Basic and diluted | ($0.30) | ($0.23) |
Shares used in computing net loss per share of common stock: | ' | ' |
Basic and diluted | 17,224 | 17,119 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Cash Flows from Operating Activities: | ' | ' |
Net loss | ($5,217) | ($3,984) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Depreciation and amortization | 2,545 | 2,145 |
Amortization of intangible assets | 1,086 | 1,317 |
Stock-based compensation | 806 | 1,083 |
Change in fair value of contingent consideration liability | -1,134 | 147 |
Deferred income taxes | 591 | -598 |
Tax short-fall from stock-based compensation | ' | -78 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | 2,810 | 4,908 |
Inventory | 1,283 | 1,449 |
Prepaid expenses and other current assets | 274 | 757 |
Other assets | 332 | -385 |
Accounts payable | -9,653 | -7,335 |
Partner commissions payable | -2,026 | -2,154 |
Accrued royalties payables | -2,443 | -1,900 |
Accrued and other liabilities | -2,448 | -2,745 |
Income taxes payable | ' | -765 |
Deferred revenue | -123 | -4,118 |
Net cash used in operating activities | -13,317 | -12,256 |
Cash Flows from Investing Activities: | ' | ' |
Proceeds from maturities of short-term investments | ' | 2,490 |
Purchase of property and equipment | -372 | -498 |
Capitalization of software and website development costs | -874 | -778 |
Net cash (used in) provided by investing activities | -1,246 | 1,214 |
Cash Flows from Financing Activities: | ' | ' |
Payments of short-term borrowings | ' | -894 |
Principal payments on capital lease obligations | -142 | -129 |
Proceeds from exercise of common stock options | 299 | 16 |
Payments under insurance financing | -256 | ' |
Net cash used in financing activities | -99 | -1,007 |
Net decrease in cash and cash equivalents | -14,662 | -12,049 |
Cash and cash equivalents - beginning of period | 33,335 | 31,198 |
Cash and cash equivalents - end of period | 18,673 | 19,149 |
Supplemental Disclosures of Cash Flow Information: | ' | ' |
Cash paid for interest | 41 | 44 |
Income taxes paid during the period | ' | 997 |
Noncash Investing and Financing Activities: | ' | ' |
Property and equipment acquired under rent agreement | ' | 321 |
Accrued purchases of property and equipment | $13 | $170 |
Business_and_Summary_of_Signif
Business and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Business and Summary of Significant Accounting Policies | ' |
1. Business and Summary of Significant Accounting Policies | |
Business | |
CafePress Inc., or the Company, formerly CafePress.com, Inc., was incorporated under the laws of the State of California on October 18, 1999. On January 19, 2005, the Company was reincorporated under the laws of the State of Delaware. On June 7, 2011, the name of the Company was changed to CafePress Inc. | |
The Company serves its customers, including both consumers and content owners, through our portfolio of e-commerce websites, including our flagship website, CafePress.com and through our e-commerce platform services. The Company’s consumers include millions of individuals, groups, businesses and organizations who leverage its innovative and proprietary print-on-demand services to express personal and shared interests, beliefs and affiliations by customizing a wide variety of products. These products include apparel, drinkware, accessories, wall art, home accents and stationery. The Company’s content owner customers include individual designers and branded content licensors who leverage its e-commerce websites and platforms to reach a mass consumer base and share and monetize their content in a variety of ways. | |
The majority of the Company’s net revenues are generated from sales of customized products through e-commerce websites, associated partner websites or through storefronts hosted by CafePress. In addition, revenues are generated from fulfillment services, including print and production services provided to third parties. Customized products include user-designed products as well as products designed by our content owners | |
The Company manages substantially all aspects of doing business online, including e-commerce services, product manufacturing and sourcing, fulfillment, and customer service. | |
Basis of Presentation | |
The accompanying unaudited condensed financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany transactions and balances have been eliminated. | |
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP, and following the requirements of the Securities and Exchange Commission, or SEC, for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These financial statements have been prepared on the same basis as the Company’s annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, that are necessary for a fair statement of the Company’s financial information. The results of operations for the three months ended March 31, 2014 are not necessarily indicative of the results to be expected for the year ending December 31, 2014 or for any other interim period or for any other future year. The balance sheet as of December 31, 2013 has been derived from audited financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. | |
The accompanying condensed consolidated financial statements and related financial information should be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2013 included in the Company’s Annual Report on Form 10-K as filed on March 31, 2014 with the SEC. | |
Use of Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including but not limited to those related to revenue recognition, provisions for doubtful accounts, credit card chargebacks, sales returns, inventory write-downs, stock-based compensation, legal contingencies, depreciable lives, asset impairments, accounting for business combinations, and income taxes including required valuation allowances. The Company bases its estimates on historical experience, projections for future performance and other assumptions that it believes to be reasonable under the circumstances. Actual results could differ materially from those estimates. | |
Revenue Recognition | |
The Company recognizes revenues from product sales, net of estimated returns based on historical experience, when the following revenue recognition criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or the service has been provided; (3) the selling price or fee revenue earned is fixed or determinable; and (4) collection of the resulting receivable is reasonably assured. | |
The Company evaluates whether it is appropriate to record the gross amount of product sales and related costs as product revenues or the net amount earned as fulfillment revenues. Revenues are recorded at the gross amount when the Company is the primary obligor in a transaction, is subject to inventory and credit risk, has latitude in establishing prices and selecting suppliers, or has most of these indicators. When the Company is not the primary obligor and does not take inventory risk, revenues will be recorded at the net amount received by the Company as fulfillment revenues. | |
Product sales and shipping revenues are recognized net of promotional discounts, rebates, and return allowances. Revenues from product sales and services rendered are recorded net of sales and consumption taxes. The Company periodically provides incentives to customers to encourage purchases. Such offers include current discount offers, such as percentage discounts off current purchases, and other similar offers. Current discount offers, when used by customers, are treated as a reduction of revenues. The Company maintains an allowance for estimated future returns and credit card chargebacks based on current period revenues and historical experience. | |
The Company accounts for flash deal promotions through group-buying websites as gift certificates. Deferred revenue is recorded at the time of the promotion based on the gross fee payable by the end customer as the Company considers it is the primary obligor in the transaction. The Company defers the costs for the direct and incremental sales commission retained by group-buying websites and records the associated expense as a component of sales and marketing expense at the time revenue is recognized. Revenue is recognized on redemption of the offer and delivery of the product to the Company’s customers. | |
The Company recognizes gift certificate breakage from flash deal promotions and gift certificate sales as a component of revenues. The Company monitors historical breakage experience and when sufficient history of redemption exists, the Company records breakage revenue in proportion to actual gift certificate redemptions. When the Company concludes that insufficient history of redemption and breakage experience exists, breakage revenue is recognized upon expiration of the flash deal promotion or in the period the Company considers the obligation for future performance related to such breakage to be remote. Changes in customers’ behavior could impact the amounts that are ultimately redeemed and could affect the breakage recognized as a component of revenues. | |
The Company recognized breakage revenue for flash deal promotions of $1.0 million and $1.2 million and the associated direct sales commission of $0.3 million and $0.4 million for the three months ended March 31, 2014 and 2013, respectively. This increased operating income by $0.7 million and $0.8 million for the three months ended March 31, 2014 and 2013, respectively. | |
Deferred revenues include funds received in advance of product fulfillment, deferred revenue for flash deal promotions and giftcards and amounts deferred until applicable revenue recognition criteria are met. Direct and incremental costs associated with deferred revenue are deferred, classified as deferred costs and recognized in the period revenue is recognized. |
Balance_Sheet_Items
Balance Sheet Items | 3 Months Ended | ||||||||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ' | ||||||||||||||||||||||||||||
Balance Sheet Items | ' | ||||||||||||||||||||||||||||
2. Balance Sheet Items | |||||||||||||||||||||||||||||
Property and equipment, net are comprised of the following (in thousands): | |||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||
Building | $ | 3,782 | $ | 3,782 | |||||||||||||||||||||||||
Office furniture and computer equipment | 14,318 | 14,232 | |||||||||||||||||||||||||||
Computer software | 2,440 | 2,402 | |||||||||||||||||||||||||||
Internal use software and website development | 15,735 | 14,846 | |||||||||||||||||||||||||||
Production equipment | 22,599 | 22,535 | |||||||||||||||||||||||||||
Leasehold improvements | 5,241 | 5,217 | |||||||||||||||||||||||||||
Total property and equipment | 64,115 | 63,014 | |||||||||||||||||||||||||||
Less: accumulated depreciation and amortization | (43,594 | ) | (41,050 | ) | |||||||||||||||||||||||||
Property and equipment, net | $ | 20,521 | $ | 21,964 | |||||||||||||||||||||||||
Accrued liabilities consist of the following (in thousands): | |||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||
Payroll and employee related expense | $ | 3,010 | $ | 2,696 | |||||||||||||||||||||||||
Other accrued liabilities | 1,405 | 2,859 | |||||||||||||||||||||||||||
Production costs | 1,330 | 2,400 | |||||||||||||||||||||||||||
Unclaimed royalty payments | 995 | 995 | |||||||||||||||||||||||||||
Professional services | 774 | 557 | |||||||||||||||||||||||||||
Royalties-minimum guarantee | 709 | 597 | |||||||||||||||||||||||||||
Accrued advertising | 354 | 337 | |||||||||||||||||||||||||||
Allowance for sales returns and chargebacks | 266 | 931 | |||||||||||||||||||||||||||
Contingent consideration, short-term portion | 196 | 1,127 | |||||||||||||||||||||||||||
Acquisition-related costs | — | 42 | |||||||||||||||||||||||||||
Accrued liabilities | $ | 9,039 | $ | 12,541 | |||||||||||||||||||||||||
The following table presents the changes in the allowance for sales returns and chargebacks (in thousands): | |||||||||||||||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||
Balance, beginning of period | $ | 931 | $ | 453 | |||||||||||||||||||||||||
Add: provision | 1,201 | 1,130 | |||||||||||||||||||||||||||
Less: deductions and other adjustments | (1,866 | ) | (1,362 | ) | |||||||||||||||||||||||||
Balance, end of period | $ | 266 | $ | 221 | |||||||||||||||||||||||||
Intangible assets are composed of the following (in thousands): | |||||||||||||||||||||||||||||
March 31, 2014 | December 31, 2013 | ||||||||||||||||||||||||||||
Amortization | Gross | Accumulated | Net | Gross | Accumulated | Net | |||||||||||||||||||||||
period | carrying | amortization | carrying | carrying | amortization | carrying | |||||||||||||||||||||||
amount | amount | amount | amount | ||||||||||||||||||||||||||
Developed technology | 4.0 years | $ | 12,277 | $ | (5,774 | ) | $ | 6,503 | $ | 12,277 | $ | (5,119 | ) | $ | 7,158 | ||||||||||||||
Business relationships | 5.5 years | 7,817 | (3,942 | ) | 3,875 | 7,817 | (3,701 | ) | 4,116 | ||||||||||||||||||||
Other intangible assets | 6.4 years | 6,979 | (3,440 | ) | 3,539 | 6,979 | (3,250 | ) | 3,729 | ||||||||||||||||||||
Total | $ | 27,073 | $ | (13,156 | ) | $ | 13,917 | $ | 27,073 | $ | (12,070 | ) | $ | 15,003 | |||||||||||||||
Fair_Value_of_Financial_Instru
Fair Value of Financial Instruments | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Fair Value of Financial Instruments | ' | ||||||||||||||||
3. Fair Value of Financial Instruments | |||||||||||||||||
The Company records its financial assets and liabilities at fair value. The accounting guidance for fair value provides a framework for measuring fair value, clarifies the definition of fair value, and expands disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability, an exit price, in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: | |||||||||||||||||
Level 1 – Quoted prices in active markets for identical assets or liabilities. | |||||||||||||||||
Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |||||||||||||||||
Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | |||||||||||||||||
The Company’s financial instruments, including cash and cash equivalents, short-term investments, accounts receivable, accounts payable and accrued liabilities have carrying amounts which approximate fair value due to the short-term maturity of these instruments. | |||||||||||||||||
The following table represents the Company’s fair value hierarchy for its financial assets and liabilities (in thousands): | |||||||||||||||||
March 31, 2014 | |||||||||||||||||
Fair Value | Level I | Level II | Level III | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market funds | $ | 3,586 | $ | 3,586 | $ | — | $ | — | |||||||||
Total financial assets | $ | 3,586 | $ | 3,586 | $ | — | $ | — | |||||||||
Liabilities: | |||||||||||||||||
Acquisition related contingent consideration | $ | 807 | $ | — | $ | — | $ | 807 | |||||||||
Total financial liabilities | $ | 807 | $ | — | $ | — | $ | 807 | |||||||||
31-Dec-13 | |||||||||||||||||
Fair Value | Level I | Level II | Level III | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market funds | $ | 21,582 | $ | 21,582 | $ | — | $ | — | |||||||||
Total financial assets | $ | 21,582 | $ | 21,582 | $ | — | $ | — | |||||||||
Liabilities: | |||||||||||||||||
Acquisition related contingent consideration | $ | 1,941 | $ | — | $ | — | $ | 1,941 | |||||||||
Total financial liabilities | $ | 1,941 | $ | — | $ | — | $ | 1,941 | |||||||||
In 2012 and 2011, the Company acquired businesses which the Company accounted for under the purchase method of accounting. The terms of the agreements relating to the acquisitions provide for contingent consideration up to $19.8 million that is accounted for as part of the purchase consideration. The estimated fair value of the performance-based contingent consideration was $0.8 million and $1.9 million as of March 31, 2014 and December 31, 2013, respectively. This contingent liability has been reflected as a current liability of $0.2 million and a non-current liability of $0.6 million as of March 31, 2014 and as a current liability of $1.1 million and a non-current liability of $0.8 million at December 31, 2013. The Company determined the estimated fair value of the liability for the contingent consideration based on a probability-weighted discounted cash flow analysis. The fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in the fair value hierarchy. In each period, the Company reassesses its current estimates of performance relative to the stated targets and adjusts the liability to the estimated fair value. Contingent consideration (benefit)/expense is recorded for any change in the estimated fair value of the recognized amount of the liability for contingent consideration. Any further changes to these estimates and assumptions could significantly impact the estimated fair values recorded for this liability resulting in significant charges to the Condensed Consolidated Statements of Operations. | |||||||||||||||||
The change in the contingent consideration liability, which is a Level 3 liability measured at fair value on a recurring basis, is summarized as follows during the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Fair value — beginning of period | $ | 1,941 | $ | 8,882 | |||||||||||||
Change in fair value | (1,134 | ) | 147 | ||||||||||||||
Fair value — end of period | $ | 807 | $ | 9,029 | |||||||||||||
The change in fair value of contingent consideration classified within Level 3 of the fair value hierarchy is recorded within acquisition-related costs in the consolidated statement of operations. | |||||||||||||||||
The decrease in the fair value of the contingent consideration during the three months ended March 31, 2014 is a result of one of our acquisitions not achieving stated earnout targets for the period. |
Line_of_Credit
Line of Credit | 3 Months Ended |
Mar. 31, 2014 | |
Debt Disclosure [Abstract] | ' |
Line of Credit | ' |
4. Line of Credit | |
In connection with the acquisition of EZ Prints in October 2012, the Company acquired a line of credit facility. The balance on the line of credit facility was $0.9 million at December 31, 2012. In February 2013, the Company repaid the outstanding balance and terminated the facility. | |
In March 2013, the Company entered into a credit agreement which provides for a revolving credit facility of $5.0 million to fund acquisitions, share repurchases and other general corporate needs, is available through March 2015 and bears interest at either the London Inter Bank Offer Rate +1.75% or the bank’s prime rate +.75%. This credit agreement requires the Company to comply with various financial covenants, all of which the Company was in compliance with at March 31, 2014 and December 31, 2013, and is secured on all assets of the Company. There were no draws against the facility as of March 31, 2014 and December 31, 2013. |
StockBased_Compensation
Stock-Based Compensation | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Equity [Abstract] | ' | ||||||||||||||||
Stock-Based Compensation | ' | ||||||||||||||||
5. Stock-Based Compensation | |||||||||||||||||
The fair value of the Company’s stock-based payment awards was estimated on the grant date using the Black-Scholes option-pricing model. The expected term of options granted is calculated using the simplified method. The risk-free rate is based on the rates in effect at the time of grant for zero coupon U.S. Treasury notes with maturities approximately equal to each grant’s expected life. The expected volatility is based upon the volatility of a group of publicly traded industry peer companies. A dividend yield of zero is applied since the Company has not historically paid dividends and has no intention to pay dividends in the near future. | |||||||||||||||||
The following table summarizes stock option activity related to shares of common stock (in thousands, except the weighted average exercise price): | |||||||||||||||||
Number of | Weighted- | Weighted- | Aggregate | ||||||||||||||
Stock Options | Average Exercise | Average | Intrinsic Value | ||||||||||||||
Outstanding | Price | Remaining | |||||||||||||||
Contractual | |||||||||||||||||
Life (Years) | |||||||||||||||||
Outstanding — December 31, 2013 | 2,788 | $ | 11.09 | 3.62 | $ | 971 | |||||||||||
Granted | 216 | 5.95 | |||||||||||||||
Exercised | (51 | ) | 5.53 | ||||||||||||||
Forfeited | (311 | ) | 10.16 | ||||||||||||||
Outstanding — March 31, 2014 | 2,642 | $ | 10.89 | 4.1 | $ | 936 | |||||||||||
Vested and expected to vest — March 31, 2014 | 2,257 | $ | 11.17 | 3.76 | $ | 906 | |||||||||||
Options exercisable — March 31, 2014 | 1,656 | $ | 11.23 | 3.08 | $ | 876 | |||||||||||
The fair value of the option awards was calculated using the Black-Scholes option valuation model with the following assumptions: | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Expected term (in years) | 4.6 | 4.5 | |||||||||||||||
Risk-free interest rate | 1.5 | % | 0.7 | % | |||||||||||||
Expected volatility | 48 | % | 58 | % | |||||||||||||
Expected dividend rate | 0 | % | 0 | % | |||||||||||||
Restricted Stock Unit Activity | |||||||||||||||||
The Company may grant restricted stock units, or RSUs, to its employees, consultants or outside directors under the provisions of the 2012 Stock Plan. The cost of RSUs is determined using the fair value of the Company’s common stock on the date of grant. Compensation cost is amortized on a straight-line basis over the requisite service period. | |||||||||||||||||
Restricted stock award and restricted stock unit activity for the three months ended March 31, 2014 is summarized as follows (unit numbers in thousands): | |||||||||||||||||
Number of Units | Weighted | ||||||||||||||||
Outstanding | Average Grant | ||||||||||||||||
Date Fair Value | |||||||||||||||||
Per Unit | |||||||||||||||||
Awarded and unvested at December 31, 2013 | 72 | $ | 6.09 | ||||||||||||||
Granted | 260 | 5.93 | |||||||||||||||
Vested | (7 | ) | 6.09 | ||||||||||||||
Forfeited and cancelled | — | — | |||||||||||||||
Awarded and unvested at March 31, 2014 | 325 | $ | 5.96 | ||||||||||||||
Stock-Based Compensation Expense | |||||||||||||||||
Cost of net revenues and operating expenses include stock-based compensation as follows (in thousands): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Cost of revenues | $ | 48 | $ | 71 | |||||||||||||
Sales and marketing | 33 | 112 | |||||||||||||||
Technology and development | 112 | 68 | |||||||||||||||
General and administrative | 613 | 832 | |||||||||||||||
Total stock-based compensation expense | $ | 806 | $ | 1,083 | |||||||||||||
Capitalizable stock-based compensation relating to software development was not significant for any period presented. |
Net_Income_Loss_per_Share_of_C
Net Income (Loss) per Share of Common Stock | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Net Income (Loss) per Share of Common Stock | ' | ||||||||
6. Net Income (Loss) per Share of Common Stock | |||||||||
Basic net loss per share is computed by dividing the net loss attributable to common shares for the period by the weighted average number of common shares outstanding during the period. | |||||||||
Diluted net loss per share attributed to common shares is computed by dividing the net loss attributable to common shares for the period by the weighted average number of common and potential common shares outstanding during the period, if the effect of each class of potential common shares is dilutive. Potential common shares include restricted stock units and incremental shares of common stock issuable upon the exercise of stock options. | |||||||||
The following table sets forth the computation of the Company’s basic and diluted net loss per share of common stock (in thousands, except for per share amounts): | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Net loss | $ | (5,217 | ) | $ | (3,984 | ) | |||
Shares used in computing net loss per share of common stock, basic and diluted | 17,224 | 17,119 | |||||||
Net loss per share of common stock, basic and diluted | $ | (0.30 | ) | $ | (0.23 | ) | |||
The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net income per share of common stock for the periods presented because including them would have been antidilutive: | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Stock options to purchase common stock | 2,642 | 3,494 | |||||||
Restricted stock units | 325 | — |
Income_Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2014 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
7. Income Taxes | |
The Company recorded a $0.5 million provision and a $1.9 million benefit for income taxes for the three months ended March 31, 2014 and 2013, respectively. The Company’s effective tax rate was (11.1%) and 32.7% for the three months ended March 31, 2014 and 2013, respectively. For the three months ended March 31, 2014, the effective tax rate was different than the statutory tax rate primarily due to the effect of the reduction of the estimated fair value of contingent consideration and tax loss carryback generated in the quarter while maintaining a full valuation allowance against its deferred tax assets. The tax expense for the three months ended March 31, 2013 was different than the statutory tax rate primarily due to stock-based compensation. | |
Realization of deferred tax assets is dependent on future taxable income, the existence and timing of which is uncertain. Based on recent losses, the Company determined it cannot conclude that it is more likely than not that the deferred tax assets will be realized, and accordingly in the fourth quarter of 2013 recorded a non-cash income tax provision of $8.9 million to establish a full valuation allowance on the deferred tax assets. We have continued to maintain a full valuation allowance against its deferred tax assets as of March 31, 2014. |
Segment_Information
Segment Information | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Segment Reporting [Abstract] | ' | ||||||||
Segment Information | ' | ||||||||
8. Segment Information | |||||||||
Operating segments are defined as components of an enterprise that engage in business activities for which separate financial information is available and evaluated by the chief operating decision maker in deciding how to allocate resources and assessing performance. The Company’s chief operating decision maker is its chief executive officer. | |||||||||
The chief executive officer reviews financial information presented on a consolidated basis, for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, or plans for levels or components below the consolidated unit level. Accordingly, the Company operates as a single reportable segment. | |||||||||
The Company’s revenues by geographic region, based on the location to where the product was shipped, are summarized as follows (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
United States | $ | 43,251 | $ | 47,488 | |||||
International | 4,937 | 5,019 | |||||||
Total | $ | 48,188 | $ | 52,507 | |||||
All of the Company’s long-lived assets are located in the United States. |
Restructuring
Restructuring | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Restructuring And Related Activities [Abstract] | ' | ||||
Restructuring | ' | ||||
9. Restructuring | |||||
Restructuring costs were $0.7 million in the three months ended March 31, 2014 and are included in Restructuring in the accompanying Condensed Consolidated Statements of Operations. This expense consists of a $0.4 million charge related to the exit of a portion of one of our production facilities in Georgia as we continue to integrate production capabilities into our Louisville, KY plant, and a $0.3 million charge for severance payments owed to a former employee. The unused portion of the production facility was exited in its entirety by March 31, 2014. | |||||
The change in the restructuring liability is summarized as follows during the three months ended March 31, 2014: | |||||
Three Months Ended | |||||
March 31, 2014 | |||||
Accrued restructuring balance-beginning of period | $ | — | |||
Employee severance accruals | 300 | ||||
Lease restructuring accruals | 405 | ||||
Cash payments | (120 | ) | |||
Accrued restructuring balance, end of period | $ | 585 | |||
The restructuring liability has been reflected as a current liability of $0.4 million and a non-current liability of $0.2 million. |
Business_and_Summary_of_Signif1
Business and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Business | ' |
Business | |
CafePress Inc., or the Company, formerly CafePress.com, Inc., was incorporated under the laws of the State of California on October 18, 1999. On January 19, 2005, the Company was reincorporated under the laws of the State of Delaware. On June 7, 2011, the name of the Company was changed to CafePress Inc. | |
The Company serves its customers, including both consumers and content owners, through our portfolio of e-commerce websites, including our flagship website, CafePress.com and through our e-commerce platform services. The Company’s consumers include millions of individuals, groups, businesses and organizations who leverage its innovative and proprietary print-on-demand services to express personal and shared interests, beliefs and affiliations by customizing a wide variety of products. These products include apparel, drinkware, accessories, wall art, home accents and stationery. The Company’s content owner customers include individual designers and branded content licensors who leverage its e-commerce websites and platforms to reach a mass consumer base and share and monetize their content in a variety of ways. | |
The majority of the Company’s net revenues are generated from sales of customized products through e-commerce websites, associated partner websites or through storefronts hosted by CafePress. In addition, revenues are generated from fulfillment services, including print and production services provided to third parties. Customized products include user-designed products as well as products designed by our content owners | |
The Company manages substantially all aspects of doing business online, including e-commerce services, product manufacturing and sourcing, fulfillment, and customer service. | |
Basis of Presentation | ' |
Basis of Presentation | |
The accompanying unaudited condensed financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany transactions and balances have been eliminated. | |
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP, and following the requirements of the Securities and Exchange Commission, or SEC, for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These financial statements have been prepared on the same basis as the Company’s annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, that are necessary for a fair statement of the Company’s financial information. The results of operations for the three months ended March 31, 2014 are not necessarily indicative of the results to be expected for the year ending December 31, 2014 or for any other interim period or for any other future year. The balance sheet as of December 31, 2013 has been derived from audited financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. | |
The accompanying condensed consolidated financial statements and related financial information should be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2013 included in the Company’s Annual Report on Form 10-K as filed on March 31, 2014 with the SEC. | |
Use of Estimates | ' |
Use of Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including but not limited to those related to revenue recognition, provisions for doubtful accounts, credit card chargebacks, sales returns, inventory write-downs, stock-based compensation, legal contingencies, depreciable lives, asset impairments, accounting for business combinations, and income taxes including required valuation allowances. The Company bases its estimates on historical experience, projections for future performance and other assumptions that it believes to be reasonable under the circumstances. Actual results could differ materially from those estimates. | |
Revenue Recognition | ' |
Revenue Recognition | |
The Company recognizes revenues from product sales, net of estimated returns based on historical experience, when the following revenue recognition criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or the service has been provided; (3) the selling price or fee revenue earned is fixed or determinable; and (4) collection of the resulting receivable is reasonably assured. | |
The Company evaluates whether it is appropriate to record the gross amount of product sales and related costs as product revenues or the net amount earned as fulfillment revenues. Revenues are recorded at the gross amount when the Company is the primary obligor in a transaction, is subject to inventory and credit risk, has latitude in establishing prices and selecting suppliers, or has most of these indicators. When the Company is not the primary obligor and does not take inventory risk, revenues will be recorded at the net amount received by the Company as fulfillment revenues. | |
Product sales and shipping revenues are recognized net of promotional discounts, rebates, and return allowances. Revenues from product sales and services rendered are recorded net of sales and consumption taxes. The Company periodically provides incentives to customers to encourage purchases. Such offers include current discount offers, such as percentage discounts off current purchases, and other similar offers. Current discount offers, when used by customers, are treated as a reduction of revenues. The Company maintains an allowance for estimated future returns and credit card chargebacks based on current period revenues and historical experience. | |
The Company accounts for flash deal promotions through group-buying websites as gift certificates. Deferred revenue is recorded at the time of the promotion based on the gross fee payable by the end customer as the Company considers it is the primary obligor in the transaction. The Company defers the costs for the direct and incremental sales commission retained by group-buying websites and records the associated expense as a component of sales and marketing expense at the time revenue is recognized. Revenue is recognized on redemption of the offer and delivery of the product to the Company’s customers. | |
The Company recognizes gift certificate breakage from flash deal promotions and gift certificate sales as a component of revenues. The Company monitors historical breakage experience and when sufficient history of redemption exists, the Company records breakage revenue in proportion to actual gift certificate redemptions. When the Company concludes that insufficient history of redemption and breakage experience exists, breakage revenue is recognized upon expiration of the flash deal promotion or in the period the Company considers the obligation for future performance related to such breakage to be remote. Changes in customers’ behavior could impact the amounts that are ultimately redeemed and could affect the breakage recognized as a component of revenues. | |
The Company recognized breakage revenue for flash deal promotions of $1.0 million and $1.2 million and the associated direct sales commission of $0.3 million and $0.4 million for the three months ended March 31, 2014 and 2013, respectively. This increased operating income by $0.7 million and $0.8 million for the three months ended March 31, 2014 and 2013, respectively. | |
Deferred revenues include funds received in advance of product fulfillment, deferred revenue for flash deal promotions and giftcards and amounts deferred until applicable revenue recognition criteria are met. Direct and incremental costs associated with deferred revenue are deferred, classified as deferred costs and recognized in the period revenue is recognized. |
Balance_Sheet_Items_Tables
Balance Sheet Items (Tables) | 3 Months Ended | ||||||||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ' | ||||||||||||||||||||||||||||
Property and Equipment, Net | ' | ||||||||||||||||||||||||||||
Property and equipment, net are comprised of the following (in thousands): | |||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||
Building | $ | 3,782 | $ | 3,782 | |||||||||||||||||||||||||
Office furniture and computer equipment | 14,318 | 14,232 | |||||||||||||||||||||||||||
Computer software | 2,440 | 2,402 | |||||||||||||||||||||||||||
Internal use software and website development | 15,735 | 14,846 | |||||||||||||||||||||||||||
Production equipment | 22,599 | 22,535 | |||||||||||||||||||||||||||
Leasehold improvements | 5,241 | 5,217 | |||||||||||||||||||||||||||
Total property and equipment | 64,115 | 63,014 | |||||||||||||||||||||||||||
Less: accumulated depreciation and amortization | (43,594 | ) | (41,050 | ) | |||||||||||||||||||||||||
Property and equipment, net | $ | 20,521 | $ | 21,964 | |||||||||||||||||||||||||
Accrued Liabilities | ' | ||||||||||||||||||||||||||||
Accrued liabilities consist of the following (in thousands): | |||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||
Payroll and employee related expense | $ | 3,010 | $ | 2,696 | |||||||||||||||||||||||||
Other accrued liabilities | 1,405 | 2,859 | |||||||||||||||||||||||||||
Production costs | 1,330 | 2,400 | |||||||||||||||||||||||||||
Unclaimed royalty payments | 995 | 995 | |||||||||||||||||||||||||||
Professional services | 774 | 557 | |||||||||||||||||||||||||||
Royalties-minimum guarantee | 709 | 597 | |||||||||||||||||||||||||||
Accrued advertising | 354 | 337 | |||||||||||||||||||||||||||
Allowance for sales returns and chargebacks | 266 | 931 | |||||||||||||||||||||||||||
Contingent consideration, short-term portion | 196 | 1,127 | |||||||||||||||||||||||||||
Acquisition-related costs | — | 42 | |||||||||||||||||||||||||||
Accrued liabilities | $ | 9,039 | $ | 12,541 | |||||||||||||||||||||||||
Allowances for Sales Returns and Chargebacks | ' | ||||||||||||||||||||||||||||
The following table presents the changes in the allowance for sales returns and chargebacks (in thousands): | |||||||||||||||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||
Balance, beginning of period | $ | 931 | $ | 453 | |||||||||||||||||||||||||
Add: provision | 1,201 | 1,130 | |||||||||||||||||||||||||||
Less: deductions and other adjustments | (1,866 | ) | (1,362 | ) | |||||||||||||||||||||||||
Balance, end of period | $ | 266 | $ | 221 | |||||||||||||||||||||||||
Component of Intangible Assets | ' | ||||||||||||||||||||||||||||
Intangible assets are composed of the following (in thousands): | |||||||||||||||||||||||||||||
March 31, 2014 | December 31, 2013 | ||||||||||||||||||||||||||||
Amortization | Gross | Accumulated | Net | Gross | Accumulated | Net | |||||||||||||||||||||||
period | carrying | amortization | carrying | carrying | amortization | carrying | |||||||||||||||||||||||
amount | amount | amount | amount | ||||||||||||||||||||||||||
Developed technology | 4.0 years | $ | 12,277 | $ | (5,774 | ) | $ | 6,503 | $ | 12,277 | $ | (5,119 | ) | $ | 7,158 | ||||||||||||||
Business relationships | 5.5 years | 7,817 | (3,942 | ) | 3,875 | 7,817 | (3,701 | ) | 4,116 | ||||||||||||||||||||
Other intangible assets | 6.4 years | 6,979 | (3,440 | ) | 3,539 | 6,979 | (3,250 | ) | 3,729 | ||||||||||||||||||||
Total | $ | 27,073 | $ | (13,156 | ) | $ | 13,917 | $ | 27,073 | $ | (12,070 | ) | $ | 15,003 | |||||||||||||||
Fair_Value_of_Financial_Instru1
Fair Value of Financial Instruments (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Fair Value Hierarchy for its Financial Assets and Liabilities | ' | ||||||||||||||||
The following table represents the Company’s fair value hierarchy for its financial assets and liabilities (in thousands): | |||||||||||||||||
March 31, 2014 | |||||||||||||||||
Fair Value | Level I | Level II | Level III | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market funds | $ | 3,586 | $ | 3,586 | $ | — | $ | — | |||||||||
Total financial assets | $ | 3,586 | $ | 3,586 | $ | — | $ | — | |||||||||
Liabilities: | |||||||||||||||||
Acquisition related contingent consideration | $ | 807 | $ | — | $ | — | $ | 807 | |||||||||
Total financial liabilities | $ | 807 | $ | — | $ | — | $ | 807 | |||||||||
31-Dec-13 | |||||||||||||||||
Fair Value | Level I | Level II | Level III | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market funds | $ | 21,582 | $ | 21,582 | $ | — | $ | — | |||||||||
Total financial assets | $ | 21,582 | $ | 21,582 | $ | — | $ | — | |||||||||
Liabilities: | |||||||||||||||||
Acquisition related contingent consideration | $ | 1,941 | $ | — | $ | — | $ | 1,941 | |||||||||
Total financial liabilities | $ | 1,941 | $ | — | $ | — | $ | 1,941 | |||||||||
Change in Contingent Consideration Liability Measured at Fair Value on Recurring Basis | ' | ||||||||||||||||
The change in the contingent consideration liability, which is a Level 3 liability measured at fair value on a recurring basis, is summarized as follows during the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Fair value — beginning of period | $ | 1,941 | $ | 8,882 | |||||||||||||
Change in fair value | (1,134 | ) | 147 | ||||||||||||||
Fair value — end of period | $ | 807 | $ | 9,029 | |||||||||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Equity [Abstract] | ' | ||||||||||||||||
Stock Option Activity Related to Shares of Common Stock | ' | ||||||||||||||||
The following table summarizes stock option activity related to shares of common stock (in thousands, except the weighted average exercise price): | |||||||||||||||||
Number of | Weighted- | Weighted- | Aggregate | ||||||||||||||
Stock Options | Average Exercise | Average | Intrinsic Value | ||||||||||||||
Outstanding | Price | Remaining | |||||||||||||||
Contractual | |||||||||||||||||
Life (Years) | |||||||||||||||||
Outstanding — December 31, 2013 | 2,788 | $ | 11.09 | 3.62 | $ | 971 | |||||||||||
Granted | 216 | 5.95 | |||||||||||||||
Exercised | (51 | ) | 5.53 | ||||||||||||||
Forfeited | (311 | ) | 10.16 | ||||||||||||||
Outstanding — March 31, 2014 | 2,642 | $ | 10.89 | 4.1 | $ | 936 | |||||||||||
Vested and expected to vest — March 31, 2014 | 2,257 | $ | 11.17 | 3.76 | $ | 906 | |||||||||||
Options exercisable — March 31, 2014 | 1,656 | $ | 11.23 | 3.08 | $ | 876 | |||||||||||
Fair Value of Option Awards | ' | ||||||||||||||||
The fair value of the option awards was calculated using the Black-Scholes option valuation model with the following assumptions: | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Expected term (in years) | 4.6 | 4.5 | |||||||||||||||
Risk-free interest rate | 1.5 | % | 0.7 | % | |||||||||||||
Expected volatility | 48 | % | 58 | % | |||||||||||||
Expected dividend rate | 0 | % | 0 | % | |||||||||||||
Restricted Stock Award and Restricted Stock Unit Activity | ' | ||||||||||||||||
Restricted stock award and restricted stock unit activity for the three months ended March 31, 2014 is summarized as follows (unit numbers in thousands): | |||||||||||||||||
Number of Units | Weighted | ||||||||||||||||
Outstanding | Average Grant | ||||||||||||||||
Date Fair Value | |||||||||||||||||
Per Unit | |||||||||||||||||
Awarded and unvested at December 31, 2013 | 72 | $ | 6.09 | ||||||||||||||
Granted | 260 | 5.93 | |||||||||||||||
Vested | (7 | ) | 6.09 | ||||||||||||||
Forfeited and cancelled | — | — | |||||||||||||||
Awarded and unvested at March 31, 2014 | 325 | $ | 5.96 | ||||||||||||||
Cost of Net Revenues and Operating Expenses Include Stock-Based Compensation | ' | ||||||||||||||||
Cost of net revenues and operating expenses include stock-based compensation as follows (in thousands): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Cost of revenues | $ | 48 | $ | 71 | |||||||||||||
Sales and marketing | 33 | 112 | |||||||||||||||
Technology and development | 112 | 68 | |||||||||||||||
General and administrative | 613 | 832 | |||||||||||||||
Total stock-based compensation expense | $ | 806 | $ | 1,083 | |||||||||||||
Net_Income_Loss_per_Share_of_C1
Net Income (Loss) per Share of Common Stock (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Basic and Diluted Net Loss per Share of Common Stock | ' | ||||||||
The following table sets forth the computation of the Company’s basic and diluted net loss per share of common stock (in thousands, except for per share amounts): | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Net loss | $ | (5,217 | ) | $ | (3,984 | ) | |||
Shares used in computing net loss per share of common stock, basic and diluted | 17,224 | 17,119 | |||||||
Net loss per share of common stock, basic and diluted | $ | (0.30 | ) | $ | (0.23 | ) | |||
Computation of Diluted Net Income per Share of Common Stock | ' | ||||||||
The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net income per share of common stock for the periods presented because including them would have been antidilutive: | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Stock options to purchase common stock | 2,642 | 3,494 | |||||||
Restricted stock units | 325 | — |
Segment_Information_Tables
Segment Information (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Segment Reporting [Abstract] | ' | ||||||||
Schedule of Revenues by Geographic Region | ' | ||||||||
The Company’s revenues by geographic region, based on the location to where the product was shipped, are summarized as follows (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
United States | $ | 43,251 | $ | 47,488 | |||||
International | 4,937 | 5,019 | |||||||
Total | $ | 48,188 | $ | 52,507 | |||||
Restructuring_Tables
Restructuring (Tables) | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Restructuring And Related Activities [Abstract] | ' | ||||
Summary of Change in Restructuring Liability | ' | ||||
The change in the restructuring liability is summarized as follows during the three months ended March 31, 2014: | |||||
Three Months Ended | |||||
March 31, 2014 | |||||
Accrued restructuring balance-beginning of period | $ | — | |||
Employee severance accruals | 300 | ||||
Lease restructuring accruals | 405 | ||||
Cash payments | (120 | ) | |||
Accrued restructuring balance, end of period | $ | 585 | |||
Business_and_Summary_of_Signif2
Business and Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Subsidiary or Equity Method Investee [Line Items] | ' | ' |
Date of incorporation | 18-Oct-99 | ' |
Date of reincorporation | 19-Jan-05 | ' |
Sales commission | $0.30 | $0.40 |
Operating income | 0.7 | 0.8 |
Flash deal promotions [Member] | ' | ' |
Subsidiary or Equity Method Investee [Line Items] | ' | ' |
Breakage revenue | $1 | $1.20 |
Balance_Sheet_Items_Property_a
Balance Sheet Items - Property and Equipment, Net (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Property, Plant and Equipment [Line Items] | ' | ' |
Total property and equipment | $64,115 | $63,014 |
Less: accumulated depreciation and amortization | -43,594 | -41,050 |
Property and equipment, net | 20,521 | 21,964 |
Building [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total property and equipment | 3,782 | 3,782 |
Office furniture and computer equipment [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total property and equipment | 14,318 | 14,232 |
Computer software [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total property and equipment | 2,440 | 2,402 |
Internal use software and website development [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total property and equipment | 15,735 | 14,846 |
Production equipment [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total property and equipment | 22,599 | 22,535 |
Leasehold improvements [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total property and equipment | $5,241 | $5,217 |
Balance_Sheet_Items_Accrued_Li
Balance Sheet Items - Accrued Liabilities (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||||
Payables And Accruals [Abstract] | ' | ' | ' | ' |
Payroll and employee related expense | $3,010 | $2,696 | ' | ' |
Other accrued liabilities | 1,405 | 2,859 | ' | ' |
Production costs | 1,330 | 2,400 | ' | ' |
Unclaimed royalty payments | 995 | 995 | ' | ' |
Professional services | 774 | 557 | ' | ' |
Royalties-minimum guarantee | 709 | 597 | ' | ' |
Accrued advertising | 354 | 337 | ' | ' |
Allowance for sales returns and chargebacks | 266 | 931 | 221 | 453 |
Contingent consideration, short-term portion | 196 | 1,127 | ' | ' |
Acquisition-related costs | ' | 42 | ' | ' |
Accrued liabilities | $9,039 | $12,541 | ' | ' |
Balance_Sheet_Items_Allowances
Balance Sheet Items - Allowances for Sales Returns and Chargebacks (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Valuation And Qualifying Accounts [Abstract] | ' | ' |
Balance, beginning of period | $931 | $453 |
Add: provision | 1,201 | 1,130 |
Less: deductions and other adjustments | -1,866 | -1,362 |
Balance, end of period | $266 | $221 |
Balance_Sheet_Items_Component_
Balance Sheet Items - Component of Intangible Assets (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross carrying amount | $27,073 | $27,073 |
Accumulated amortization | -13,156 | -12,070 |
Net carrying amount | 13,917 | 15,003 |
Developed technology [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Amortization period | '4 years | ' |
Gross carrying amount | 12,277 | 12,277 |
Accumulated amortization | -5,774 | -5,119 |
Net carrying amount | 6,503 | 7,158 |
Business relationships [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Amortization period | '5 years 6 months | ' |
Gross carrying amount | 7,817 | 7,817 |
Accumulated amortization | -3,942 | -3,701 |
Net carrying amount | 3,875 | 4,116 |
Other intangible assets [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Amortization period | '6 years 4 months 24 days | ' |
Gross carrying amount | 6,979 | 6,979 |
Accumulated amortization | -3,440 | -3,250 |
Net carrying amount | $3,539 | $3,729 |
Fair_Value_of_Financial_Instru2
Fair Value of Financial Instruments - Fair Value Hierarchy for its Financial Assets and Liabilities (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Cash and cash equivalents: | ' | ' |
Total financial assets | $3,586 | $21,582 |
Liabilities: | ' | ' |
Total financial liabilities | 807 | 1,941 |
Acquisition related contingent consideration [Member] | ' | ' |
Liabilities: | ' | ' |
Total financial liabilities | 807 | 1,941 |
Money market funds [Member] | ' | ' |
Cash and cash equivalents: | ' | ' |
Total financial assets | 3,586 | 21,582 |
Level I [Member] | ' | ' |
Cash and cash equivalents: | ' | ' |
Total financial assets | 3,586 | 21,582 |
Liabilities: | ' | ' |
Total financial liabilities | ' | ' |
Level I [Member] | Acquisition related contingent consideration [Member] | ' | ' |
Liabilities: | ' | ' |
Total financial liabilities | ' | ' |
Level I [Member] | Money market funds [Member] | ' | ' |
Cash and cash equivalents: | ' | ' |
Total financial assets | 3,586 | 21,582 |
Level II [Member] | ' | ' |
Cash and cash equivalents: | ' | ' |
Total financial assets | ' | ' |
Liabilities: | ' | ' |
Total financial liabilities | ' | ' |
Level II [Member] | Acquisition related contingent consideration [Member] | ' | ' |
Liabilities: | ' | ' |
Total financial liabilities | ' | ' |
Level II [Member] | Money market funds [Member] | ' | ' |
Cash and cash equivalents: | ' | ' |
Total financial assets | ' | ' |
Level III [Member] | ' | ' |
Cash and cash equivalents: | ' | ' |
Total financial assets | ' | ' |
Liabilities: | ' | ' |
Total financial liabilities | 807 | 1,941 |
Level III [Member] | Acquisition related contingent consideration [Member] | ' | ' |
Liabilities: | ' | ' |
Total financial liabilities | 807 | 1,941 |
Level III [Member] | Money market funds [Member] | ' | ' |
Cash and cash equivalents: | ' | ' |
Total financial assets | ' | ' |
Fair_Value_of_Financial_Instru3
Fair Value of Financial Instruments - Additional Information (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Fair Value Disclosures [Abstract] | ' | ' |
Contingent consideration amount included in purchase price allocation | $19,800,000 | ' |
Estimated fair value of the performance-based contingent consideration | 800,000 | 1,900,000 |
Contingent liability reflected as a current liability | 196,000 | 1,127,000 |
Contingent liability reflected as a non-current liability | $600,000 | $800,000 |
Fair_Value_of_Financial_Instru4
Fair Value of Financial Instruments - Change in Contingent Consideration Liability Measured at Fair Value on Recurring Basis (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Fair Value Disclosures [Abstract] | ' | ' |
Fair value - beginning of period | $1,941 | $8,882 |
Change in fair value | -1,134 | 147 |
Fair value - end of period | $807 | $9,029 |
Line_of_Credit_Additional_Info
Line of Credit - Additional Information (Detail) (USD $) | Dec. 31, 2012 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 |
Revolving credit facility expiring march 2015 [Member] | Revolving credit facility expiring march 2015 [Member] | Revolving credit facility expiring march 2015 [Member] | Revolving credit facility expiring march 2015 [Member] | Revolving credit facility expiring march 2015 [Member] | ||
London inter bank offer rate [Member] | Prime rate [Member] | |||||
Line of Credit Facility [Line Items] | ' | ' | ' | ' | ' | ' |
Line of credit facility, amount outstanding | $900,000 | ' | ' | ' | ' | ' |
Line of credit facility, maximum credit availability | ' | ' | ' | 5,000,000 | ' | ' |
Interest rate added to the reference rate | ' | ' | ' | ' | 1.75% | 0.75% |
Draws against the facility | ' | $0 | $0 | ' | ' | ' |
StockBased_Compensation_Additi
Stock-Based Compensation - Additional Information (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ' |
Dividend yield rate | 0.00% | 0.00% |
Dividends paid | $0 | $0 |
StockBased_Compensation_Stock_
Stock-Based Compensation - Stock Option Activity Related to Shares of Common Stock (Detail) (USD $) | 3 Months Ended | 12 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ' |
Number of Stock Options Outstanding, Outstanding, Beginning Balance | 2,788 | ' |
Number of Stock Options Outstanding, Granted | 216 | ' |
Number of Stock Options Outstanding, Exercised | -51 | ' |
Number of Stock Options Outstanding, Forfeited | -311 | ' |
Number of Stock Options Outstanding, Outstanding, Ending Balance | 2,642 | 2,788 |
Number of Stock Options Outstanding, Vested and expected to vest, Ending Balance | 2,257 | ' |
Number of Stock Options Outstanding, Options exercisable | 1,656 | ' |
Weighted-Average Exercise Price, Outstanding, Beginning Balance | $11.09 | ' |
Weighted-Average Exercise Price, Granted | $5.95 | ' |
Weighted-Average Exercise Price, Exercised | $5.53 | ' |
Weighted-Average Exercise Price, Forfeited | $10.16 | ' |
Weighted-Average Exercise Price, Outstanding, Ending Balance | $10.89 | $11.09 |
Weighted-Average Exercise Price, Vested and expected to vest, Ending Balance | $11.17 | ' |
Weighted-Average Exercise Price, Options exercisable | $11.23 | ' |
Weighted-Average Remaining Contractual Life (Years), Outstanding | '4 years 1 month 6 days | '3 years 7 months 13 days |
Weighted-Average Remaining Contractual Life (Years), Vested and expected to vest | '3 years 9 months 4 days | ' |
Weighted-Average Remaining Contractual Life (Years), Options exercisable | '3 years 29 days | ' |
Aggregate Intrinsic Value, Outstanding, Beginning Balance | $971 | ' |
Aggregate Intrinsic Value, Outstanding, Ending Balance | 936 | 971 |
Aggregate Intrinsic Value, Vested and expected to vest, Ending Balance | 906 | ' |
Aggregate Intrinsic Value, Options exercisable | $876 | ' |
StockBased_Compensation_Fair_V
Stock-Based Compensation - Fair Value of Option Awards (Detail) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ' |
Expected term (in years) | '4 years 7 months 6 days | '4 years 6 months |
Risk-free interest rate | 1.50% | 0.70% |
Expected volatility | 48.00% | 58.00% |
Expected dividend rate | 0.00% | 0.00% |
StockBased_Compensation_Restri
Stock-Based Compensation - Restricted Stock Award and Restricted Stock Unit Activity (Detail) (USD $) | 3 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' |
Beginning Balance, Awarded and unvested, Number of Units Outstanding | 72 |
Granted, Number of Units Outstanding | 260 |
Vested, Number of Units Outstanding | -7 |
Forfeited and cancelled, Number of Units Outstanding | ' |
Ending Balance, Awarded and unvested, Number of Units Outstanding | 325 |
Beginning Balance, Awarded and unvested, Weighted Average Grant Date Fair Value Per Unit | $6.09 |
Granted, Weighted Average Grant Date Fair Value Per Unit | $5.93 |
Vested, Weighted Average Grant Date Fair Value Per Unit | $6.09 |
Forfeited and cancelled, Weighted Average Grant Date Fair Value Per Unit | ' |
Ending Balance, Awarded and unvested, Weighted Average Grant Date Fair Value Per Unit | $5.96 |
StockBased_Compensation_Cost_o
Stock-Based Compensation - Cost of Net Revenues and Operating Expenses Include Stock-Based Compensation (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Total stock-based compensation expense | $806 | $1,083 |
Cost of revenues [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Total stock-based compensation expense | 48 | 71 |
Sales and marketing [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Total stock-based compensation expense | 33 | 112 |
Technology and development [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Total stock-based compensation expense | 112 | 68 |
General and administrative [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Total stock-based compensation expense | $613 | $832 |
Net_Income_Loss_per_Share_of_C2
Net Income (Loss) per Share of Common Stock - Basic and Diluted Net Loss per Share of Common Stock (Detail) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Earnings Per Share [Abstract] | ' | ' |
Net loss | ($5,217) | ($3,984) |
Shares used in computing net loss per share of common stock, basic and diluted | 17,224 | 17,119 |
Net loss per share of common stock, basic and diluted | ($0.30) | ($0.23) |
Net_Income_Loss_per_Share_of_C3
Net Income (Loss) per Share of Common Stock - Computation of Diluted Net Income per Share of Common Stock (Detail) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Restricted stock units [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Dilutive securities excluded from computation of diluted net income per share | 325 | ' |
Stock options to purchase common stock [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Dilutive securities excluded from computation of diluted net income per share | 2,642 | 3,494 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Informations (Detail) (USD $) | 3 Months Ended | ||
Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Provision for (benefit from) income taxes | $522,000 | ' | ($1,937,000) |
Effective income tax rate | -11.10% | ' | 32.70% |
Non-cash income tax provision for valuation allowance | ' | $8,900,000 | ' |
Segment_Information_Additional
Segment Information - Additional Information (Detail) | 3 Months Ended |
Mar. 31, 2014 | |
Segment | |
Segment_Manager | |
Entity | |
Segment Reporting [Abstract] | ' |
Number of business activity | 1 |
Number of segment managers | 0 |
Number of reportable segment | 1 |
Segment_Information_Schedule_o
Segment Information - Schedule of Revenues by Geographic Region (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Segment Reporting Information [Line Items] | ' | ' |
Total | $48,188 | $52,507 |
United States [Member] | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Total | 43,251 | 47,488 |
International [Member] | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Total | $4,937 | $5,019 |
Restructuring_Summary_of_Chang
Restructuring - Summary of Change in Restructuring Liability (Detail) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2014 |
Restructuring And Related Activities [Abstract] | ' |
Accrued restructuring balance-beginning of period | ' |
Employee severance accruals | 300 |
Lease restructuring accruals | 405 |
Cash payments | -120 |
Accrued restructuring balance, end of period | $585 |
Restructuring_Additional_Infor
Restructuring - Additional Information (Detail) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Restructuring And Related Activities [Abstract] | ' |
Restructuring costs | $747,000 |
Charge related to exit of a portion of production facilities | 400,000 |
Severance costs | 300,000 |
Restructuring current liability | 400,000 |
Restructuring non-current liability | $200,000 |