Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2020 | Apr. 24, 2020 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Entity Registrant Name | MODEL N, INC. | |
Entity Central Index Key | 0001118417 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Shell Company | false | |
Entity Current Filing Status | Yes | |
Entity Common Stock, Shares Outstanding | 34,277,353 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2020 | Sep. 30, 2019 |
Current assets | ||
Cash and cash equivalents | $ 61,283 | $ 60,780 |
Accounts receivable, net of allowance for doubtful accounts of $31 as of March 31, 2020 and $51 as of September 30, 2019 | 26,448 | 26,953 |
Prepaid expenses | 1,347 | 2,776 |
Other current assets | 6,898 | 4,039 |
Total current assets | 95,976 | 94,548 |
Property and equipment, net | 726 | 1,043 |
Operating lease right-of-use assets | 5,707 | |
Goodwill | 39,283 | 39,283 |
Intangible assets, net | 26,723 | 29,131 |
Other assets | 5,394 | 5,588 |
Total assets | 173,809 | 169,593 |
Current liabilities | ||
Accounts payable | 3,172 | 2,302 |
Accrued employee compensation | 11,148 | 19,906 |
Accrued liabilities | 4,561 | 4,354 |
Operating lease liabilities, current portion | 2,593 | |
Deferred revenue, current portion | 45,579 | 44,875 |
Long term debt, current portion | 944 | 4,911 |
Total current liabilities | 67,997 | 76,348 |
Long term debt | 38,479 | 39,371 |
Operating lease liabilities, less current portion | 3,481 | |
Other long-term liabilities | 1,630 | 1,152 |
Total liabilities | 111,587 | 116,871 |
Commitments and contingencies | ||
Stockholders’ equity | ||
Common Stock, $0.00015 par value; 200,000 shares authorized; 34,249 and 32,995 shares issued and outstanding at March 31, 2020 and September 30, 2019, respectively | 5 | 5 |
Preferred Stock, $0.00015 par value; 5,000 shares authorized; no shares issued and outstanding | 0 | 0 |
Additional paid-in capital | 284,099 | 266,295 |
Accumulated other comprehensive loss | (1,846) | (1,169) |
Accumulated deficit | (220,036) | (212,409) |
Total stockholders’ equity | 62,222 | 52,722 |
Total liabilities and stockholders’ equity | $ 173,809 | $ 169,593 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2020 | Sep. 30, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 31 | $ 51 |
Common Stock, par value (in dollars per share) | $ 0.00015 | $ 0.00015 |
Common Stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common Stock, shares issued (in shares) | 34,249,000 | 32,995,000 |
Common Stock, shares outstanding (in shares) | 34,249,000 | 32,995,000 |
Preferred Stock, par value (in dollars per share) | $ 0.00015 | $ 0.00015 |
Preferred Stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred Stock, shares issued (in shares) | 0 | 0 |
Preferred Stock, shares outstanding (in shares) | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues | ||||
Total revenues | $ 39,952 | $ 34,843 | $ 78,340 | $ 69,920 |
Cost of revenues | ||||
Total cost of revenues | 16,483 | 16,746 | 32,835 | 33,313 |
Gross profit | 23,469 | 18,097 | 45,505 | 36,607 |
Operating expenses | ||||
Research and development | 9,102 | 7,415 | 17,618 | 14,827 |
Sales and marketing | 10,953 | 8,598 | 19,966 | 16,650 |
General and administrative | 7,545 | 6,833 | 14,510 | 12,989 |
Total operating expenses | 27,600 | 22,846 | 52,094 | 44,466 |
Loss from operations | (4,131) | (4,749) | (6,589) | (7,859) |
Interest expense, net | 402 | 891 | 965 | 1,624 |
Other expenses (income), net | (243) | 127 | (255) | 412 |
Loss before income taxes | (4,290) | (5,767) | (7,299) | (9,895) |
Provision for income taxes | 339 | 141 | 328 | 739 |
Net loss | $ (4,629) | $ (5,908) | $ (7,627) | $ (10,634) |
Net loss per share attributable to common stockholders: | ||||
Basic and diluted (in dollars per share) | $ (0.14) | $ (0.18) | $ (0.23) | $ (0.34) |
Weighted average number of shares used in computing net loss per share attributable to common stockholders: | ||||
Basic and diluted (in shares) | 33,794 | 31,999 | 33,468 | 31,741 |
Subscription | ||||
Revenues | ||||
Total revenues | $ 28,991 | $ 25,940 | $ 57,173 | $ 51,142 |
Cost of revenues | ||||
Total cost of revenues | 8,798 | 8,852 | 17,508 | 17,590 |
Professional services | ||||
Revenues | ||||
Total revenues | 10,961 | 8,903 | 21,167 | 18,778 |
Cost of revenues | ||||
Total cost of revenues | $ 7,685 | $ 7,894 | $ 15,327 | $ 15,723 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (4,629) | $ (5,908) | $ (7,627) | $ (10,634) |
Other comprehensive income (loss), net of tax | ||||
Unrealized gain (loss) on cash flow hedges | (450) | 49 | (432) | 49 |
Foreign currency translation gain (loss) | (270) | 56 | (245) | 242 |
Total comprehensive loss | $ (5,349) | $ (5,803) | $ (8,304) | $ (10,343) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities | ||
Net loss | $ (7,627) | $ (10,634) |
Adjustments to reconcile net loss to net cash provided by operating activities | ||
Depreciation and amortization | 2,813 | 3,533 |
Stock-based compensation | 11,832 | 9,099 |
Amortization of debt discount and issuance cost | 140 | 290 |
Deferred income taxes | 35 | 6 |
Amortization of capitalized contract acquisition costs | 1,242 | 780 |
Other non-cash charges | (20) | (108) |
Changes in assets and liabilities | ||
Accounts receivable | 529 | 8,353 |
Prepaid expenses and other assets | (1,278) | 595 |
Accounts payable | 876 | 862 |
Accrued employee compensation | (4,895) | (4,438) |
Other current and long-term liabilities | (1,603) | 708 |
Deferred revenue | 1,391 | (8,581) |
Net cash provided by operating activities | 3,435 | 465 |
Cash flows from investing activities | ||
Purchases of property and equipment | (98) | (167) |
Net cash used in investing activities | (98) | (167) |
Cash flows from financing activities | ||
Proceeds from exercise of stock options and issuance of employee stock purchase plan | 2,242 | 2,018 |
Principal payments on debt | (5,000) | (5,000) |
Net cash used in financing activities | (2,758) | (2,982) |
Effect of exchange rate changes on cash and cash equivalents | (76) | 70 |
Net increase (decrease) in cash and cash equivalents | 503 | (2,614) |
Cash and cash equivalents | ||
Beginning of period | 60,780 | 56,704 |
End of period | $ 61,283 | $ 54,090 |
The Company and Significant Acc
The Company and Significant Accounting Policies and Estimates | 6 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
The Company and Significant Accounting Policies and Estimates | The Company and Significant Accounting Policies and Estimates Model N, Inc. (“Model N,” “we,” “us,” “our,” and “the Company”) was incorporated in Delaware on December 14, 1999 . The Company is a provider of cloud revenue management solutions for the life sciences and high tech industries. The Company’s solutions enable its customers to maximize revenues and reduce revenue compliance risk by transforming their revenue life cycle from a series of tactical, disjointed operations into a strategic end-to-end process, which enables them to manage the strategy and execution of pricing, contracting, incentives and rebates. The Company’s corporate headquarters are located in San Mateo, California, with additional offices in the United States, India and Switzerland. Fiscal Year The Company’s fiscal year ends on September 30. References to fiscal year 2020, for example, refer to the fiscal year ending September 30, 2020 . Basis for Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The unaudited condensed consolidated balance sheet as of September 30, 2019 has been derived from the audited financial statements which are included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2019 (“the Annual Report”) on file with the SEC. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report. In the opinion of management, the unaudited interim consolidated financial statements include all the normal recurring adjustments necessary to present fairly our condensed consolidated financial statements. The results of operations for the six months ended March 31, 2020 are not necessarily indicative of the operating results for the full fiscal year 2020 or any future periods. The condensed consolidated financial statements include the accounts of Model N and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation. Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities and reported amounts of revenues and expenses during the reporting periods. Significant items subject to such estimates include revenue recognition, legal contingencies, income taxes, stock-based compensation and valuation of goodwill and intangibles. These estimates and assumptions are based on management’s best estimates and judgment. Management regularly evaluates its estimates and assumptions using historical experience and other factors. However, actual results could differ significantly from these estimates. COVID-19 The Company is subject to risks and uncertainties as a result of the COVID-19 pandemic. At this point, the extent to which COVID-19 may impact the Company’s financial condition or results of operations is uncertain. As of the date of issuance of these financial statements, the Company is not aware of any specific event or circumstance that would require us to update our estimates, judgments or revise the carrying value of our assets or liabilities. The estimates discussed above may change, as new events occur and additional information is obtained, and are recognized in the consolidated financial statements as soon as they become known. New Accounting Pronouncements Recently Adopted Accounting Guidance In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842). Under Topic 842, lessees are required to recognize a lease liability, which represents the discounted obligation to make future minimum lease payments, and a corresponding right-of-use asset on the balance sheet for most leases and provide enhanced disclosures. The Company adopted Topic 842 on October 1, 2019 using the alternative modified transition method. The Company elected the package of practical expedients and carried forward its historical lease classification, its assessment on whether a contract was or contained a lease, and its initial direct costs for any leases that existed prior to October 1, 2019. The Company also elected to combine lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet. Upon adoption, the Company recognized total operating lease right-of-use (“ROU”) assets and total operating lease liabilities of $6.7 million and $7.2 million , respectively, on the condensed consolidated balance sheet. The difference of $0.5 million represents deferred rent that existed as of the date of adoption, which was an offset to the opening balance of operating lease ROU assets. The adoption had no impact on opening retained earnings. In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This new accounting standard update simplifies the measurement of goodwill by eliminating the step two impairment test. Step two measures a goodwill impairment loss by comparing the implied fair value of goodwill with the carrying amount of that goodwill. The new guidance requires a comparison of the fair value of the Company’s single reporting unit with the carrying amount and the Company is required to recognize an impairment charge for the amount by which the carrying amount exceeds the fair value. Additionally, the Company will consider the income tax effects from any tax deductible goodwill on the carrying amount when measuring the goodwill impairment loss, if applicable. The new guidance becomes effective for goodwill impairment tests in fiscal years beginning after December 15, 2019 with early adoption permitted. The Company adopted this guidance beginning in the first quarter of fiscal year 2020 and it did not have a material impact on the condensed consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In August 2018, the FASB issued ASU 2018-15, Intangibles (Topic 350), Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which aligns 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 standard also requires customers to amortize the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. ASU 2018-15 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the impact this standard will have on its consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments, which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. ASU 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019, with early adoption permitted. ASU 2016-13 requires a cumulative effect adjustment to the balance sheet as of the beginning of the first reporting period in which the guidance is effective. The Company is currently evaluating the impact this standard will have on its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes, which simplifies the accounting for incomes taxes by removing certain exceptions to the general principles in Topic 740 and amending existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the impact this standard will have on its consolidated financial statements. Significant Accounting Policies There have been no changes in the significant accounting policies from those that were disclosed in the Annual Report, except for changes associated with lease accounting resulting from the adoption of ASU 2016-02, Leases (Topic 842) and ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment as described below: Leases The Company determines if an arrangement contains a lease at inception. The Company has entered into operating lease agreements primarily for offices. The Company does not have any finance leases. Operating lease ROU assets represent the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent the Company’s obligation to make payments arising from the lease. Operating leases are included in “Operating lease right-of-use assets”, “Operating lease liabilities, current portion”, and “Operating lease liabilities, less current portion” in the condensed consolidated balance sheets. Operating lease ROU assets and operating lease liabilities are recognized at the present value of the future lease payments at commencement date. ROU assets also include any initial direct costs incurred and any lease payments made at or before the lease commencement date, less lease incentives received. The Company’s lease arrangements may contain lease and non-lease components. The Company elected to combine lease and non-lease components. In determining the present value of the future lease payments, the Company considers only payments that are fixed and determinable at commencement date, including non-lease components. Variable components such as utilities and maintenance costs are expensed as incurred. The Company uses its incremental borrowing rate based on the information available at the commencement date in determining the lease liabilities as the Company’s leases generally do not provide an implicit rate. In determining the appropriate incremental borrowing rate, the Company considers information including, but not limited to, its credit rating, the lease term, and the economic environment where the leased asset is located. Lease terms include periods under options to extend or terminate the lease when the Company is reasonably certain that the option will be exercised. Lease expense is recognized on a straight-line basis over the lease term. The Company also elected to apply the short-term lease measurement and recognition exemption in which ROU assets and lease liabilities are not recognized for leases with a term of 12 months or less. Goodwill The Company records goodwill when consideration paid in an acquisition exceeds the fair value of the net tangible assets and the identified intangible assets acquired. Goodwill is not amortized, but rather is tested for impairment annually or more frequently if events or changes in circumstances indicate that the carrying value may not be recoverable. For purposes of goodwill impairment testing, the Company has one reporting unit. The Company has elected to first assess the qualitative factors to determine whether it is more likely than not that the fair value of the single reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the goodwill impairment test. When performing the goodwill impairment test, the Company compares the fair value of the single reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying amount exceeds the fair value with goodwill written down accordingly. There have been no goodwill impairments during the periods presented. |
Revenues from Contracts with Cu
Revenues from Contracts with Customers | 6 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenues from Contracts with Customers | Revenues from Contracts with Customers Revenue Recognition The Company derives revenues primarily from subscription revenues and professional services revenues. Disaggregation of Revenues See Note 13, Geographic Information, for information on revenue by geography. Customer Contract Balances The following table reflects contract balances with customers (in thousands): As of As of Accounts receivable, net $ 26,448 $ 26,953 Contract asset 4,316 1,588 Deferred revenue 46,761 45,385 Capitalized contract acquisition costs 6,858 6,626 Accounts Receivable Accounts receivable represents the Company’s right to consideration that is unconditional, net of allowances for doubtful accounts. The allowance for doubtful accounts is based on management’s assessment of the collectability of accounts. Contract Asset Contract asset represents revenue that has been recognized for satisfied performance obligations for which the Company does not have an unconditional right to consideration. Deferred Revenue Deferred revenue, which is a contract liability, consists of amounts that have been invoiced and for which the Company has the right to bill, but that have not been recognized as revenue because the related goods or services have not been transferred. The non-current portion of deferred revenue is included in other long-term liabilities in the condensed consolidated balance sheets. During the three and six months ended March 31, 2020 , the Company recognized revenue of $19.2 million and $31.6 million , respectively, that was included in the deferred revenue balances at the beginning of the periods. During the three and six months ended March 31, 2019, the Company recognized revenue of $18.4 million and $33.1 million , respectively, that was included in the deferred revenue balances at the beginning of the periods. Capitalized Contract Acquisition Costs The Company capitalizes incremental costs incurred to acquire contracts with customers, primarily sales commissions, for which the associated revenue is expected to be recognized in future periods. The Company incurs these costs in connection with both initial contracts and renewals. Such costs for renewals are not considered commensurate with those for initial contracts given the substantive difference in commission rates in proportion to their respective contract values. The costs in connection with initial contracts and renewals are deferred and amortized over an expected customer life of five years and over the renewal term, respectively, which corresponds to the period of benefit to the customer. The Company determined the period of benefit by considering the Company’s history of customer relationships, length of customer contracts, technological development and obsolescence, and other factors. The current and non-current portion of capitalized contract acquisition costs are included in other current assets and other assets on the condensed consolidated balance sheets. Amortization expense is included in sales and marketing expenses on the condensed consolidated statements of operations. As of March 31, 2020 , the current and non-current portions of capitalized contract acquisition costs were $2.1 million and $4.8 million , respectively. The Company amortized $0.6 million and $1.2 million of contract acquisition costs during the three and six months ended March 31, 2020 , respectively. For the three and six months ended March 31, 2020 , there was no impairment related to capitalized contract acquisition costs. Customer Deposits Customer deposits primarily relate to payments received from customers which could be refundable pursuant to the terms of the arrangement. These amounts are included in accrued liabilities on the condensed consolidated balance sheets. Customer deposits were $1.1 million and $0.4 million as of March 31, 2020 and September 30, 2019, respectively. Standard payment terms to customers generally range from thirty to ninety days; however, payment terms and conditions in our customer contracts may vary. In some cases, customers prepay for subscription and services in advance of the delivery; in other cases, payment is due as services are performed or in arrears following the delivery. Performance Obligations Remaining performance obligations represent non-cancelable contracted revenue that has not yet been recognized, which includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods. As of March 31, 2020 , the aggregate amount of the transaction price allocated to performance obligations either unsatisfied or partially unsatisfied was $154.5 million , 51% of which we expect to recognize as revenue over the next 12 months and the remainder thereafter. |
Leases
Leases | 6 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases The Company leases facilities under noncancelable operating leases with lease terms between three years and 10 years. Certain leases include options to extend or terminate the lease. The Company factored into the determination of lease payments the options that it is reasonably certain to exercise. Operating lease costs were $0.8 million and $1.7 million for the three and six months ended March 31, 2020 , respectively. Short-term lease costs, variable lease costs, and sublease income were immaterial for the three and six months ended March 31, 2020 . Cash flow information related to operating leases is as follows (in thousands): Six months ended Cash paid for amounts included in the measurement of operating lease liabilities $ 1,804 Operating lease ROU assets obtained in exchange of new operating lease liabilities 578 The weighted-average remaining lease term is 3.8 years and the weighted-average discount rate is 6.3% as of March 31, 2020 . Maturities of operating lease liabilities as of March 31, 2020 are as follows (in thousands): Fiscal Year Remaining fiscal 2020 $ 1,738 2021 1,908 2022 1,050 2023 697 2024 497 2025 and thereafter 944 Total operating lease payments 6,834 Less imputed interest 760 Total operating lease liabilities $ 6,074 The Company’s headquarter lease expires on November 30, 2020. In April 2020, the Company entered into a new noncancelable operating lease for its headquarters with a 64 months lease term that will commence on December 1, 2020. The new lease has a five year renewal option which the Company is not reasonably certain to exercise. The future payments over the 64 months lease term are $11.4 million . Future minimum payments under noncancelable operating leases as of September 30, 2019 under ASC 840 are as follows (in thousands): Fiscal Year 2020 $ 3,400 2021 1,700 2022 900 2023 400 2024 100 Total $ 6,500 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable, debt and certain accrued liabilities. The Company regularly reviews its financial instruments portfolio to identify and evaluate such instruments that have indications of possible impairment. The Company estimates the fair value of its financial instruments when there is no readily available market data, which involves some level of management estimation and judgment and may not necessarily represent the amounts that could be realized in a current or future sale of these assets. The table below sets forth the Company’s cash equivalents (in thousands) which are measured at fair value on a recurring basis by level within the fair value hierarchy. Level 1 Level 2 Level 3 Total As of March 31, 2020 Assets: Cash equivalents $ 38,948 $ — $ — $ 38,948 Total assets $ 38,948 $ — $ — $ 38,948 As of September 30, 2019 Assets: Cash equivalents $ 32,792 $ — $ — $ 32,792 Total assets $ 32,792 $ — $ — $ 32,792 The Company’s cash equivalents as of March 31, 2020 and September 30, 2019 consisted of money market funds with original maturity dates of three months or less from the date of their respective purchase. Cash equivalents are classified as Level 1. The fair value of the Company’s money market funds approximated amortized cost and, as such, there were no unrealized gains or losses on money market funds as of March 31, 2020 and September 30, 2019 . The Company’s financial instruments not measured at fair value on a recurring basis include cash, accounts receivable, accounts payable and certain accrued liabilities. These financial instruments are reflected in the financial statements at cost and approximate their fair value due to their short-term nature. As of March 31, 2020 , the carrying value of the term loan with Wells Fargo approximated fair value since the term loan bears interest at rates that fluctuate with the changes in the base rate or the LIBOR rate as elected by the Company. The Company classified the term loan with Wells Fargo and the promissory note under level 2 of the fair value measurement hierarchy as these instruments are not actively traded. See Note 7 for additional information. |
Intangible Assets
Intangible Assets | 6 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets Intangible assets consisted of the following (in thousands): Estimated As of March 31, 2020 Useful Life (in Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Intangible Assets: Customer relationships 3-10 $ 36,599 $ (12,979 ) $ 23,620 Developed technology 5-6 12,083 (8,980 ) 3,103 Total $ 48,682 $ (21,959 ) $ 26,723 Estimated As of September 30, 2019 Useful Life (in Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Intangible Assets: Customer relationships 3-10 $ 36,599 $ (11,200 ) $ 25,399 Developed technology 5-6 12,083 (8,351 ) 3,732 Backlog 5 280 (280 ) — Total $ 48,962 $ (19,831 ) $ 29,131 The Company recorded amortization expense related to the acquired intangible assets of $1.2 million and $1.3 million for the three months ended March 31, 2020 and 2019 , respectively, and $2.4 million and $2.7 million for the six months ended March 31, 2020 and 2019 , respectively. Estimated future amortization expense for the intangible assets as of March 31, 2020 is as follows (in thousands): Fiscal Year Remaining fiscal 2020 $ 2,343 2021 4,687 2022 4,687 2023 3,840 2024 3,558 2025 and thereafter 7,608 Total future amortization $ 26,723 |
Derivative Instruments and Hedg
Derivative Instruments and Hedging | 6 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging | Derivative Instruments and Hedging The Company uses foreign currency forward contracts to hedge a portion of the forecasted foreign currency-denominated expenses incurred in the normal course of business. These contracts are designated as cash flows hedges. These hedging contracts reduce, but do not entirely eliminate, the impact of adverse foreign exchange rate movements. The Company does not use any of the derivative instruments for trading or speculative purposes. These contracts have maturities of 12 months or less. The Company records changes in the fair value of cash flow hedges in accumulated other comprehensive loss in the condensed consolidated balance sheets, until the forecasted transaction occurs, at which point, the related gain or loss on the cash flow hedge is reclassified to the financial statement line item to which the derivative relates. The amounts reclassified to expenses related to the hedged transactions were immaterial for the periods presented. The fair value of the outstanding non-deliverable foreign currency forward contracts was recorded in accrued liabilities for $0.4 million as of March 31, 2020 and immaterial as of September 30, 2019. Notional Amounts of Derivative Contracts Derivative transactions are measured in terms of the notional amount but this amount is not recorded on the balance sheet and is not, when viewed in isolation, a meaningful measure of the risk profile of the instruments. The notional amount is generally not exchanged, but is used only as the basis on which the value of foreign exchange payments under these contracts are determined. The notional amounts of the outstanding foreign currency forward contracts designated as cash flow hedges were $7.9 million and $9.4 million as of March 31, 2020 and September 30, 2019, respectively. |
Debt
Debt | 6 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt Term Loan – Wells Fargo On May 4, 2018, the Company entered into a credit agreement (the “Credit Agreement”) with Wells Fargo, as administrative agent, and the lenders party thereto, for a $50.0 million term loan, as well as a revolving line of credit for an amount up to $5.0 million . In part from the proceeds of this financing, the Company repaid in full the existing term loan under the Financing Agreement discussed above. At the same time and with a portion of the proceeds, the Company repaid in full the $50.0 million term loan the Company entered into in connection with the 2017 Revitas acquisition. This term loan will mature on May 4, 2023 . As of March 31, 2020 , the Company had not drawn down from the line of credit and had $5.0 million available. On August 12, 2019, the Company entered into an amendment to the Credit Agreement whereby the applicable margins were revised. At the Company’s election, the term loan under the Credit Agreement and the revolving line of credit will bear interest based upon the Company’s leverage ratio as defined in the Credit Agreement at either (i) a base rate plus applicable margin ranging from 1.5% to 3.5% or (ii) LIBOR rate plus applicable margin ranging from 2.5% to 4.5% . Interest is payable periodically, in arrears, at the end of each interest period the Company elects. For the quarter ended March 31, 2020 , the Company’s interest rate was LIBOR rate plus 3.5% in the first month and 2.5% in the last two months. In addition, the Company is required to pay monthly in arrears an unused line fee ranging from 0.25% to 0.5% of the unused portion of the revolving line of credit based upon the Company’s leverage ratio. As a condition to entering into the Credit Agreement, the Company pledged substantially all of its assets in the United States. The Company may voluntarily prepay the term loan, with any such prepayment applied against the remaining installments of principal of the term loan on a pro rata basis or direct order of maturity, subject to certain limitations. However, the Company is required to repay the term loan with proceeds from the sale of assets, the receipt of certain insurance proceeds, litigation proceeds or indemnity payments or the incurrence of debt (in each case subject to certain exceptions). The Company prepaid approximately $4.8 million of principal on January 2, 2019, and elected to apply the prepayment against the remaining principal installments in the direct order of maturity. On July 1, 2019, the Company made another prepayment of $5.0 million and such prepayment shall be applied against the remaining installments of principal on a pro rata basis. The remaining balance of the term loan is classified as long-term debt on the condensed consolidated balance sheets. The Credit Agreement contains customary representations and warranties, subject to limitations and exceptions, and customary covenants restricting the Company’s ability and its subsidiaries to: incur additional indebtedness; incur liens; engage in mergers or other fundamental changes; consummate acquisitions; sell certain property or assets; change the nature of their business; prepay or amend certain indebtedness; pay cash dividends, other distributions or repurchase the Company’s equity interests or its subsidiaries; make investments; or engage in certain transactions with affiliates. The Credit Agreement contains certain financial covenants, including maintaining consolidated liquidity (cash in the United States plus revolving credit line availability) of at least $15.0 million , minimum levels of maintenance and subscription fee revenue and, if liquidity is less than $30.0 million , a leverage ratio of not greater than 3.50 to 1.00 until liquidity exceeds $30.0 million for 90 consecutive days. The Credit Agreement also provides for customary events of default, including failure to pay amounts due or to comply with covenants, default on other indebtedness, or a change of control. The Company was in compliance with all covenant requirements as of March 31, 2020. Promissory Notes Also in connection with the Revitas acquisition, the Company incurred $10.0 million in debt in the form of two $5.0 million promissory notes with the sellers, both of which matured and were paid on July 5, 2018 and January 5, 2020 , respectively. As of March 31, 2020 , the term loan with Wells Fargo consisted of the following (in thousands): Principal $ 39,750 Unamortized debt discount and issuance costs (327 ) Net carrying amount $ 39,423 As of March 31, 2020 , the carrying value of the debt approximated the fair value basis. The Company classified the debt under Level 2 of the fair value measurement hierarchy as the borrowings are not actively traded. The effective interest rate for the three months ended March 31, 2020 for the term loan with Wells Fargo was 5.08% . The future scheduled principal payments for the term loan with Wells Fargo as of March 31, 2020 were as follows (in thousands): Fiscal Year Remaining fiscal 2020 $ — 2021 2,609 2022 3,331 2023 33,810 Total $ 39,750 |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity The following tables present the changes of the components of stockholders’ equity (in thousands): Three Months Ended March 31, 2020 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at December 31, 2019 33,334 $ 5 $ 275,866 $ (1,126 ) $ (215,407 ) $ 59,338 Issuance of common stock upon exercise of stock options 27 — 275 — — 275 Issuance of common stock upon release of restricted stock units 803 — — — — — Issuance of common stock upon ESPP purchase 85 — 1,949 — — 1,949 Stock-based compensation — — 6,009 — — 6,009 Other comprehensive income — — — (720 ) — (720 ) Net loss — — — — (4,629 ) (4,629 ) Balance at March 31, 2020 34,249 $ 5 $ 284,099 $ (1,846 ) $ (220,036 ) $ 62,222 Three Months Ended March 31, 2019 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at December 31, 2018 31,535 $ 5 $ 249,053 $ (1,099 ) $ (197,842 ) $ 50,117 Issuance of common stock upon exercise of stock options 55 — 351 — — 351 Issuance of common stock upon release of restricted stock units 772 — — — — — Issuance of common stock upon ESPP purchase 119 — 1,631 — — 1,631 Stock-based compensation — — 4,896 — — 4,896 Other comprehensive income — — — 105 — 105 Net loss — — — — (5,908 ) (5,908 ) Balance at March 31, 2019 32,481 $ 5 $ 255,931 $ (994 ) $ (203,750 ) $ 51,192 Six Months Ended March 31, 2020 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at September 30, 2019 32,995 $ 5 $ 266,295 $ (1,169 ) $ (212,409 ) $ 52,722 Issuance of common stock upon exercise of stock options 30 — 293 — — 293 Issuance of common stock upon release of restricted stock units 1,139 — — — — — Issuance of common stock upon ESPP purchase 85 — 1,949 — — 1,949 Stock-based compensation — — 15,562 — — 15,562 Other comprehensive loss — — — (677 ) — (677 ) Net loss — — — — (7,627 ) (7,627 ) Balance at March 31, 2020 34,249 $ 5 $ 284,099 $ (1,846 ) $ (220,036 ) $ 62,222 For the six months ended March 31, 2020, the additional paid-in capital included $3.7 million related to restricted stock unit grants for the portion of the bonus recorded as stock-based compensation for the year ended September 30, 2019. Six Months Ended March 31, 2019 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at September 30, 2018 31,444 $ 5 $ 244,814 $ (1,285 ) $ (203,500 ) $ 40,034 Cumulative effect of a change in — — — — 10,384 10,384 Issuance of common stock upon exercise of stock options 62 — 387 — — 387 Issuance of common stock upon release of restricted stock units 856 — — — — — Issuance of common stock upon ESPP purchase 119 — 1,631 — — 1,631 Stock-based compensation — — 9,099 — — 9,099 Other comprehensive loss — — — 291 — 291 Net loss — — — — (10,634 ) (10,634 ) Balance at March 31, 2019 32,481 $ 5 $ 255,931 $ (994 ) $ (203,750 ) $ 51,192 |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-based Compensation As of March 31, 2020 , the Company had approximately 2.8 million shares available for future stock awards under its equity plans and any additional releases resulting from an over-achievement relating to performance-based restricted stock units. The following table summarizes our restricted stock unit (“RSU”) activity which includes performance-based RSUs under all equity plans for the six months ended March 31, 2020 : Restricted Stock Units Outstanding (in thousands) Weighted Average Grant Date Fair Value Balance at September 30, 2019 2,350 $ 16.36 Granted 1,286 28.56 Released (1,139 ) 19.59 Forfeited (86 ) 18.61 Balance at March 31, 2020 2,411 $ 21.26 Stock-based compensation recorded in the condensed consolidated statements of operations is as follows (in thousands): Three Months Ended March 31, Six Months Ended March 31, 2020 2019 2020 2019 Cost of revenues Subscription $ 495 $ 469 $ 1,017 $ 929 Professional services 560 561 1,157 1,040 Total stock-based compensation in cost of revenues 1,055 1,030 2,174 1,969 Operating expenses Research and development 1,243 861 2,669 1,625 Sales and marketing 1,656 1,239 3,062 2,384 General and administrative 2,055 1,766 3,927 3,121 Total stock-based compensation in operating expenses 4,954 3,866 9,658 7,130 Total stock-based compensation $ 6,009 $ 4,896 $ 11,832 $ 9,099 |
Income Taxes
Income Taxes | 6 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company recorded an income tax provision of $0.3 million and $0.1 million , representing effective income tax rates of (7.9)% and (2.4)% for the three months ended March 31, 2020 and 2019 , respectively; and $0.3 million and $0.7 million , representing effective income tax rates of (4.5)% and (7.5)% , for the six months ended March 31, 2020 and 2019 , respectively. The income tax provision for the three months ended March 31, 2020 was primarily related to foreign withholding taxes on dividends and foreign taxes on the Company’s profitable foreign operations. The income tax provision for the three months ended March 31, 2019 was primarily related to foreign taxes on the Company’s profitable foreign operations and state minimum taxes. The income tax provision for the six months ended March 31, 2020 was primarily related to foreign taxes on the Company’s profitable foreign operations and foreign withholding taxes on dividends partially offset by a discrete tax benefit for a true-up in federal income tax payable. The income tax provision for the first six months ended March 31, 2019 was primarily related to the foreign withholding taxes on the dividend distribution and secondarily related to foreign taxes on the Company’s profitable foreign operations. The Company elected to partially reinvest foreign earnings in certain foreign jurisdictions and expects to repatriate future foreign earnings in certain foreign jurisdictions over time. As a result, the Company records a deferred tax liability for the additional non-U.S. taxes that are expected to be incurred related to the repatriation of these earnings. During the six months ended March 31, 2020, the Company repatriated $1.0 million of foreign subsidiary earnings to the U.S. in the form of cash and paid foreign withholding taxes of $0.2 million . The Company elected to record GILTI as a period cost. The Company realized no benefit for current period losses due to maintaining a full valuation allowance against the U.S. net deferred tax assets. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (“CARES”) Act was enacted and signed into law in response to the COVID-19 pandemic. GAAP requires recognition of the tax effects of new legislation during the reporting period that includes the enactment date. The CARES Act includes changes to the tax provisions that benefits business entities and makes certain technical corrections to the 2017 Tax Cuts and Jobs Act. The tax relief measures for businesses include a five-year net operating loss carryback, suspension of annual deduction limitation of 80% of taxable income from net operating losses generated in a tax year beginning after December 31, 2017, changes in the deductibility of interest, acceleration of alternative minimum tax credit refunds, payroll tax relief, technical corrections on net operating loss carryforwards for fiscal year taxpayers and allowing accelerated deductions for qualified improvement property. The CARES Act also provides other non-tax benefits to assist those impacted by the pandemic. The Company evaluated the impact of the CARES Act and determined that there is no material impact to the income tax provision for the quarter. |
Net Loss Per Share
Net Loss Per Share | 6 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss per Share The following table sets forth the computation of the basic and diluted net loss per share attributable to common stockholders during the periods presented (in thousands, except per share data): Three Months Ended March 31, Six Months Ended March 31, 2020 2019 2020 2019 Numerator Basic and diluted Net loss attributable to common stockholders $ (4,629 ) $ (5,908 ) $ (7,627 ) $ (10,634 ) Denominator Basic and diluted Weighted average shares used in computing net loss per share attributable to common stockholders 33,794 31,999 33,468 31,741 Net loss per share attributable to common stockholders: Basic and diluted $ (0.14 ) $ (0.18 ) $ (0.23 ) $ (0.34 ) The following shares of common stock equivalents were excluded from the computation of diluted net loss per share attributable to common stockholders as the effect would have been anti-dilutive (in thousands): Three Months Ended March 31, Six Months Ended March 31, 2020 2019 2020 2019 Stock options 58 93 64 100 Performance-based RSUs and RSUs 1,318 1,524 1,455 1,643 |
Litigation and Contingencies
Litigation and Contingencies | 6 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation and Contingencies | Litigation and Contingencies Legal Proceedings The Company is not currently a party to any pending material legal proceedings. From time to time, the Company may become involved in legal proceedings arising in the ordinary course of business. Regardless of outcome, litigation can have an adverse impact on the Company due to defense and settlement costs, diversion of management resources, negative publicity and reputational harm and other factors. |
Geographic Information
Geographic Information | 6 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Geographic Information | Geographic Information The Company has one operating segment with one business activity — developing and monetizing revenue management solutions. Revenues The Company disaggregates the revenues by geographic regions based on the bill to location of its customers. Revenues from customers outside of the United States were 10% and 18% of total revenues for the three months ended March 31, 2020 and 2019 , respectively, and 9% and 17% of total revenues for the six months ended March 31, 2020 and 2019 , respectively. However, no single jurisdiction outside of the United States represented 10% or more of the total revenues for the periods presented. Long-Lived Assets The following table sets forth the Company’s property and equipment, net, by geographic region (in thousands): As of March 31, 2020 As of September 30, 2019 United States $ 591 $ 853 India 135 190 Total property and equipment, net $ 726 $ 1,043 |
The Company and Significant A_2
The Company and Significant Accounting Policies and Estimates (Policies) | 6 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis for Presentation | Basis for Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The unaudited condensed consolidated balance sheet as of September 30, 2019 has been derived from the audited financial statements which are included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2019 (“the Annual Report”) on file with the SEC. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report. In the opinion of management, the unaudited interim consolidated financial statements include all the normal recurring adjustments necessary to present fairly our condensed consolidated financial statements. The results of operations for the six months ended March 31, 2020 are not necessarily indicative of the operating results for the full fiscal year 2020 or any future periods. The condensed consolidated financial statements include the accounts of Model N and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities and reported amounts of revenues and expenses during the reporting periods. Significant items subject to such estimates include revenue recognition, legal contingencies, income taxes, stock-based compensation and valuation of goodwill and intangibles. These estimates and assumptions are based on management’s best estimates and judgment. Management regularly evaluates its estimates and assumptions using historical experience and other factors. However, actual results could differ significantly from these estimates. |
New Accounting Pronouncements | New Accounting Pronouncements Recently Adopted Accounting Guidance In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842). Under Topic 842, lessees are required to recognize a lease liability, which represents the discounted obligation to make future minimum lease payments, and a corresponding right-of-use asset on the balance sheet for most leases and provide enhanced disclosures. The Company adopted Topic 842 on October 1, 2019 using the alternative modified transition method. The Company elected the package of practical expedients and carried forward its historical lease classification, its assessment on whether a contract was or contained a lease, and its initial direct costs for any leases that existed prior to October 1, 2019. The Company also elected to combine lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet. Upon adoption, the Company recognized total operating lease right-of-use (“ROU”) assets and total operating lease liabilities of $6.7 million and $7.2 million , respectively, on the condensed consolidated balance sheet. The difference of $0.5 million represents deferred rent that existed as of the date of adoption, which was an offset to the opening balance of operating lease ROU assets. The adoption had no impact on opening retained earnings. In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This new accounting standard update simplifies the measurement of goodwill by eliminating the step two impairment test. Step two measures a goodwill impairment loss by comparing the implied fair value of goodwill with the carrying amount of that goodwill. The new guidance requires a comparison of the fair value of the Company’s single reporting unit with the carrying amount and the Company is required to recognize an impairment charge for the amount by which the carrying amount exceeds the fair value. Additionally, the Company will consider the income tax effects from any tax deductible goodwill on the carrying amount when measuring the goodwill impairment loss, if applicable. The new guidance becomes effective for goodwill impairment tests in fiscal years beginning after December 15, 2019 with early adoption permitted. The Company adopted this guidance beginning in the first quarter of fiscal year 2020 and it did not have a material impact on the condensed consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In August 2018, the FASB issued ASU 2018-15, Intangibles (Topic 350), Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which aligns 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 standard also requires customers to amortize the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. ASU 2018-15 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the impact this standard will have on its consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments, which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. ASU 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019, with early adoption permitted. ASU 2016-13 requires a cumulative effect adjustment to the balance sheet as of the beginning of the first reporting period in which the guidance is effective. The Company is currently evaluating the impact this standard will have on its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes, which simplifies the accounting for incomes taxes by removing certain exceptions to the general principles in Topic 740 and amending existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the impact this standard will have on its consolidated financial statements. Significant Accounting Policies There have been no changes in the significant accounting policies from those that were disclosed in the Annual Report, except for changes associated with lease accounting resulting from the adoption of ASU 2016-02, Leases (Topic 842) and ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment as described below: Leases The Company determines if an arrangement contains a lease at inception. The Company has entered into operating lease agreements primarily for offices. The Company does not have any finance leases. Operating lease ROU assets represent the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent the Company’s obligation to make payments arising from the lease. Operating leases are included in “Operating lease right-of-use assets”, “Operating lease liabilities, current portion”, and “Operating lease liabilities, less current portion” in the condensed consolidated balance sheets. Operating lease ROU assets and operating lease liabilities are recognized at the present value of the future lease payments at commencement date. ROU assets also include any initial direct costs incurred and any lease payments made at or before the lease commencement date, less lease incentives received. The Company’s lease arrangements may contain lease and non-lease components. The Company elected to combine lease and non-lease components. In determining the present value of the future lease payments, the Company considers only payments that are fixed and determinable at commencement date, including non-lease components. Variable components such as utilities and maintenance costs are expensed as incurred. The Company uses its incremental borrowing rate based on the information available at the commencement date in determining the lease liabilities as the Company’s leases generally do not provide an implicit rate. In determining the appropriate incremental borrowing rate, the Company considers information including, but not limited to, its credit rating, the lease term, and the economic environment where the leased asset is located. Lease terms include periods under options to extend or terminate the lease when the Company is reasonably certain that the option will be exercised. Lease expense is recognized on a straight-line basis over the lease term. The Company also elected to apply the short-term lease measurement and recognition exemption in which ROU assets and lease liabilities are not recognized for leases with a term of 12 months or less. Goodwill The Company records goodwill when consideration paid in an acquisition exceeds the fair value of the net tangible assets and the identified intangible assets acquired. Goodwill is not amortized, but rather is tested for impairment annually or more frequently if events or changes in circumstances indicate that the carrying value may not be recoverable. For purposes of goodwill impairment testing, the Company has one reporting unit. The Company has elected to first assess the qualitative factors to determine whether it is more likely than not that the fair value of the single reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the goodwill impairment test. When performing the goodwill impairment test, the Company compares the fair value of the single reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying amount exceeds the fair value with goodwill written down accordingly. There have been no goodwill impairments during the periods presented. |
Revenues from Contract with Customer | Capitalized Contract Acquisition Costs The Company capitalizes incremental costs incurred to acquire contracts with customers, primarily sales commissions, for which the associated revenue is expected to be recognized in future periods. The Company incurs these costs in connection with both initial contracts and renewals. Such costs for renewals are not considered commensurate with those for initial contracts given the substantive difference in commission rates in proportion to their respective contract values. The costs in connection with initial contracts and renewals are deferred and amortized over an expected customer life of five years and over the renewal term, respectively, which corresponds to the period of benefit to the customer. The Company determined the period of benefit by considering the Company’s history of customer relationships, length of customer contracts, technological development and obsolescence, and other factors. The current and non-current portion of capitalized contract acquisition costs are included in other current assets and other assets on the condensed consolidated balance sheets. Amortization expense is included in sales and marketing expenses on the condensed consolidated statements of operations. Accounts Receivable Accounts receivable represents the Company’s right to consideration that is unconditional, net of allowances for doubtful accounts. The allowance for doubtful accounts is based on management’s assessment of the collectability of accounts. Contract Asset Contract asset represents revenue that has been recognized for satisfied performance obligations for which the Company does not have an unconditional right to consideration. Deferred Revenue Deferred revenue, which is a contract liability, consists of amounts that have been invoiced and for which the Company has the right to bill, but that have not been recognized as revenue because the related goods or services have not been transferred. Customer Deposits Customer deposits primarily relate to payments received from customers which could be refundable pursuant to the terms of the arrangement. These amounts are included in accrued liabilities on the condensed consolidated balance sheets. Customer deposits were $1.1 million and $0.4 million as of March 31, 2020 and September 30, 2019, respectively. Standard payment terms to customers generally range from thirty to ninety days; however, payment terms and conditions in our customer contracts may vary. In some cases, customers prepay for subscription and services in advance of the delivery; in other cases, payment is due as services are performed or in arrears following the delivery. Performance Obligations Remaining performance obligations represent non-cancelable contracted revenue that has not yet been recognized, which includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods. |
Revenues from Contracts with _2
Revenues from Contracts with Customers (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Customer Contract Balances | The following table reflects contract balances with customers (in thousands): As of As of Accounts receivable, net $ 26,448 $ 26,953 Contract asset 4,316 1,588 Deferred revenue 46,761 45,385 Capitalized contract acquisition costs 6,858 6,626 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Operating Lease Cost and Cash Flow Information | Cash flow information related to operating leases is as follows (in thousands): Six months ended Cash paid for amounts included in the measurement of operating lease liabilities $ 1,804 Operating lease ROU assets obtained in exchange of new operating lease liabilities 578 |
Maturities of Operating Lease Liabilities | Maturities of operating lease liabilities as of March 31, 2020 are as follows (in thousands): Fiscal Year Remaining fiscal 2020 $ 1,738 2021 1,908 2022 1,050 2023 697 2024 497 2025 and thereafter 944 Total operating lease payments 6,834 Less imputed interest 760 Total operating lease liabilities $ 6,074 |
Schedule of Future Minimum Payments for Noncancelable Operating Leases | Future minimum payments under noncancelable operating leases as of September 30, 2019 under ASC 840 are as follows (in thousands): Fiscal Year 2020 $ 3,400 2021 1,700 2022 900 2023 400 2024 100 Total $ 6,500 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Measured on Recurring Basis | The table below sets forth the Company’s cash equivalents (in thousands) which are measured at fair value on a recurring basis by level within the fair value hierarchy. Level 1 Level 2 Level 3 Total As of March 31, 2020 Assets: Cash equivalents $ 38,948 $ — $ — $ 38,948 Total assets $ 38,948 $ — $ — $ 38,948 As of September 30, 2019 Assets: Cash equivalents $ 32,792 $ — $ — $ 32,792 Total assets $ 32,792 $ — $ — $ 32,792 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | Intangible assets consisted of the following (in thousands): Estimated As of March 31, 2020 Useful Life (in Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Intangible Assets: Customer relationships 3-10 $ 36,599 $ (12,979 ) $ 23,620 Developed technology 5-6 12,083 (8,980 ) 3,103 Total $ 48,682 $ (21,959 ) $ 26,723 Estimated As of September 30, 2019 Useful Life (in Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Intangible Assets: Customer relationships 3-10 $ 36,599 $ (11,200 ) $ 25,399 Developed technology 5-6 12,083 (8,351 ) 3,732 Backlog 5 280 (280 ) — Total $ 48,962 $ (19,831 ) $ 29,131 |
Schedule of Estimated Future Amortization Expenses | Estimated future amortization expense for the intangible assets as of March 31, 2020 is as follows (in thousands): Fiscal Year Remaining fiscal 2020 $ 2,343 2021 4,687 2022 4,687 2023 3,840 2024 3,558 2025 and thereafter 7,608 Total future amortization $ 26,723 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Term Loan with Wells Fargo and Promissory Notes | As of March 31, 2020 , the term loan with Wells Fargo consisted of the following (in thousands): Principal $ 39,750 Unamortized debt discount and issuance costs (327 ) Net carrying amount $ 39,423 |
Schedule of Future Principal Payments for Term Loan with Wells Fargo and Promissory Notes | The future scheduled principal payments for the term loan with Wells Fargo as of March 31, 2020 were as follows (in thousands): Fiscal Year Remaining fiscal 2020 $ — 2021 2,609 2022 3,331 2023 33,810 Total $ 39,750 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Schedule of Stockholder's Equity | The following tables present the changes of the components of stockholders’ equity (in thousands): Three Months Ended March 31, 2020 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at December 31, 2019 33,334 $ 5 $ 275,866 $ (1,126 ) $ (215,407 ) $ 59,338 Issuance of common stock upon exercise of stock options 27 — 275 — — 275 Issuance of common stock upon release of restricted stock units 803 — — — — — Issuance of common stock upon ESPP purchase 85 — 1,949 — — 1,949 Stock-based compensation — — 6,009 — — 6,009 Other comprehensive income — — — (720 ) — (720 ) Net loss — — — — (4,629 ) (4,629 ) Balance at March 31, 2020 34,249 $ 5 $ 284,099 $ (1,846 ) $ (220,036 ) $ 62,222 Three Months Ended March 31, 2019 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at December 31, 2018 31,535 $ 5 $ 249,053 $ (1,099 ) $ (197,842 ) $ 50,117 Issuance of common stock upon exercise of stock options 55 — 351 — — 351 Issuance of common stock upon release of restricted stock units 772 — — — — — Issuance of common stock upon ESPP purchase 119 — 1,631 — — 1,631 Stock-based compensation — — 4,896 — — 4,896 Other comprehensive income — — — 105 — 105 Net loss — — — — (5,908 ) (5,908 ) Balance at March 31, 2019 32,481 $ 5 $ 255,931 $ (994 ) $ (203,750 ) $ 51,192 Six Months Ended March 31, 2020 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at September 30, 2019 32,995 $ 5 $ 266,295 $ (1,169 ) $ (212,409 ) $ 52,722 Issuance of common stock upon exercise of stock options 30 — 293 — — 293 Issuance of common stock upon release of restricted stock units 1,139 — — — — — Issuance of common stock upon ESPP purchase 85 — 1,949 — — 1,949 Stock-based compensation — — 15,562 — — 15,562 Other comprehensive loss — — — (677 ) — (677 ) Net loss — — — — (7,627 ) (7,627 ) Balance at March 31, 2020 34,249 $ 5 $ 284,099 $ (1,846 ) $ (220,036 ) $ 62,222 For the six months ended March 31, 2020, the additional paid-in capital included $3.7 million related to restricted stock unit grants for the portion of the bonus recorded as stock-based compensation for the year ended September 30, 2019. Six Months Ended March 31, 2019 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at September 30, 2018 31,444 $ 5 $ 244,814 $ (1,285 ) $ (203,500 ) $ 40,034 Cumulative effect of a change in — — — — 10,384 10,384 Issuance of common stock upon exercise of stock options 62 — 387 — — 387 Issuance of common stock upon release of restricted stock units 856 — — — — — Issuance of common stock upon ESPP purchase 119 — 1,631 — — 1,631 Stock-based compensation — — 9,099 — — 9,099 Other comprehensive loss — — — 291 — 291 Net loss — — — — (10,634 ) (10,634 ) Balance at March 31, 2019 32,481 $ 5 $ 255,931 $ (994 ) $ (203,750 ) $ 51,192 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Restricted Stock Unit Activity (Including Performance Based Restricted Stock Units) Under All Equity Award Plans | The following table summarizes our restricted stock unit (“RSU”) activity which includes performance-based RSUs under all equity plans for the six months ended March 31, 2020 : Restricted Stock Units Outstanding (in thousands) Weighted Average Grant Date Fair Value Balance at September 30, 2019 2,350 $ 16.36 Granted 1,286 28.56 Released (1,139 ) 19.59 Forfeited (86 ) 18.61 Balance at March 31, 2020 2,411 $ 21.26 |
Stock-based Compensation | Stock-based compensation recorded in the condensed consolidated statements of operations is as follows (in thousands): Three Months Ended March 31, Six Months Ended March 31, 2020 2019 2020 2019 Cost of revenues Subscription $ 495 $ 469 $ 1,017 $ 929 Professional services 560 561 1,157 1,040 Total stock-based compensation in cost of revenues 1,055 1,030 2,174 1,969 Operating expenses Research and development 1,243 861 2,669 1,625 Sales and marketing 1,656 1,239 3,062 2,384 General and administrative 2,055 1,766 3,927 3,121 Total stock-based compensation in operating expenses 4,954 3,866 9,658 7,130 Total stock-based compensation $ 6,009 $ 4,896 $ 11,832 $ 9,099 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss per Share | The following table sets forth the computation of the basic and diluted net loss per share attributable to common stockholders during the periods presented (in thousands, except per share data): Three Months Ended March 31, Six Months Ended March 31, 2020 2019 2020 2019 Numerator Basic and diluted Net loss attributable to common stockholders $ (4,629 ) $ (5,908 ) $ (7,627 ) $ (10,634 ) Denominator Basic and diluted Weighted average shares used in computing net loss per share attributable to common stockholders 33,794 31,999 33,468 31,741 Net loss per share attributable to common stockholders: Basic and diluted $ (0.14 ) $ (0.18 ) $ (0.23 ) $ (0.34 ) |
Summary of Weighted Average Shares of Common Stock Equivalents Excluded from Computation of Diluted Net Loss per Share Attributable to Common Stockholders | The following shares of common stock equivalents were excluded from the computation of diluted net loss per share attributable to common stockholders as the effect would have been anti-dilutive (in thousands): Three Months Ended March 31, Six Months Ended March 31, 2020 2019 2020 2019 Stock options 58 93 64 100 Performance-based RSUs and RSUs 1,318 1,524 1,455 1,643 |
Geographic Information (Tables)
Geographic Information (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Company's Property and Equipment, Net by Geographic Region | The following table sets forth the Company’s property and equipment, net, by geographic region (in thousands): As of March 31, 2020 As of September 30, 2019 United States $ 591 $ 853 India 135 190 Total property and equipment, net $ 726 $ 1,043 |
The Company and Significant A_3
The Company and Significant Accounting Policies and Estimates - Narrative (Detail) | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2020USD ($)reporting_unit | Mar. 31, 2019USD ($) | Oct. 01, 2019USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease assets | $ 5,707,000 | $ 5,707,000 | |||
Operating lease liabilities | 6,074,000 | $ 6,074,000 | |||
Deferred rent asset | $ 500,000 | ||||
Number of reporting units | reporting_unit | 1 | ||||
Goodwill impairment | $ 0 | $ 0 | $ 0 | $ 0 | |
ASU 2016-02 | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease assets | 6,700,000 | ||||
Operating lease liabilities | $ 7,200,000 |
Revenues from Contracts with _3
Revenues from Contracts with Customers - Customer Contract Balances (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Sep. 30, 2019 |
Accounts receivable, net | ||
Accounts receivable, net | $ 26,448 | $ 26,953 |
Contract asset | ||
Contract asset | 4,316 | 1,588 |
Deferred revenue | ||
Deferred revenue | 46,761 | 45,385 |
Capitalized contract acquisition costs | ||
Capitalized contract acquisition costs | $ 6,858 | $ 6,626 |
Revenues from Contracts with _4
Revenues from Contracts with Customers - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |||||
Revenue recognized that was included in deferred revenue at beginning of period | $ 19,200,000 | $ 18,400,000 | $ 31,600,000 | $ 33,100,000 | |
Amortized over expected customer life | 5 years | 5 years | |||
Capitalized contract acquisition costs, current portion | $ 2,100,000 | $ 2,100,000 | |||
Capitalized contract acquisition costs, non-current portion | 4,800,000 | 4,800,000 | |||
Amortization of capitalized contract acquisition costs | 600,000 | 1,242,000 | $ 780,000 | ||
Impairment loss related to contract balances | 0 | 0 | |||
Customer deposits | $ 1,100,000 | $ 1,100,000 | $ 400,000 |
Revenues from Contracts with _5
Revenues from Contracts with Customers - Performance Obligation (Details) $ in Millions | Mar. 31, 2020USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, expected timing of satisfaction | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations not satisfied or partially satisfied | $ 154.5 |
Remaining performance obligation, percentage | 51.00% |
Remaining performance obligation, expected timing of satisfaction | 12 months |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2020 | Apr. 30, 2020 | |
Lessee, Lease, Description [Line Items] | |||
Operating lease cost for remaining term | $ 800 | $ 1,700 | |
Weighted average remaining lease term | 3 years 9 months 18 days | 3 years 9 months 18 days | |
Weighted average discount rate percent | 6.30% | 6.30% | |
Future payments over the 64 months lease term | $ 6,834 | $ 6,834 | |
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Noncancelable operating leases term | 3 years | 3 years | |
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Noncancelable operating leases term | 10 years | 10 years | |
Headquarters | Subsequent Event | |||
Lessee, Lease, Description [Line Items] | |||
Noncancelable operating leases term | 64 months | ||
Renewal option | 5 years | ||
Future payments over the 64 months lease term | $ 11,400 |
Leases - Cash Flow Information
Leases - Cash Flow Information (Details) $ in Thousands | 6 Months Ended |
Mar. 31, 2020USD ($) | |
Leases [Abstract] | |
Cash paid for amounts included in the measurement of operating lease liabilities | $ 1,804 |
Operating lease ROU assets obtained in exchange of new operating lease liabilities | $ 578 |
Leases - Maturities of Operatin
Leases - Maturities of Operating Lease Liabilities (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Leases [Abstract] | |
Remaining fiscal 2020 | $ 1,738 |
2021 | 1,908 |
2022 | 1,050 |
2023 | 697 |
2024 | 497 |
2025 and thereafter | 944 |
Total operating lease payments | 6,834 |
Less imputed interest | 760 |
Total operating lease liabilities | $ 6,074 |
Leases - Future Minimum Payment
Leases - Future Minimum Payments Under Noncancelable Operating Leases (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Leases [Abstract] | |
2020 | $ 3,400 |
2021 | 1,700 |
2022 | 900 |
2023 | 400 |
2024 | 100 |
Total | $ 6,500 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Schedule of Fair Value Measured on Recurring Basis (Detail) - Fair Value Measurement Recurring - USD ($) $ in Thousands | Mar. 31, 2020 | Sep. 30, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 38,948 | $ 32,792 |
Total assets | 38,948 | 32,792 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 38,948 | 32,792 |
Total assets | 38,948 | 32,792 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Total assets | 0 | 0 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Total assets | $ 0 | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Additional Information (Detail) - Money market funds - USD ($) | Mar. 31, 2020 | Sep. 30, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Unrealized gains | $ 0 | $ 0 |
Unrealized losses | $ 0 | $ 0 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Intangible Assets (Detail) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Sep. 30, 2019 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 48,682 | $ 48,962 |
Accumulated Amortization | (21,959) | (19,831) |
Net Carrying Amount | 26,723 | 29,131 |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 36,599 | 36,599 |
Accumulated Amortization | (12,979) | (11,200) |
Net Carrying Amount | $ 23,620 | $ 25,399 |
Customer relationships | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful lives | 3 years | 3 years |
Customer relationships | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful lives | 10 years | 10 years |
Developed technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 12,083 | $ 12,083 |
Accumulated Amortization | (8,980) | (8,351) |
Net Carrying Amount | $ 3,103 | $ 3,732 |
Developed technology | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful lives | 5 years | 5 years |
Developed technology | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful lives | 6 years | 6 years |
Backlog | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful lives | 5 years | |
Gross Carrying Amount | $ 280 | |
Accumulated Amortization | (280) | |
Net Carrying Amount | $ 0 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense of intangible assets | $ 1.2 | $ 1.3 | $ 2.4 | $ 2.7 |
Intangible Assets - Schedule _2
Intangible Assets - Schedule of Estimated Future Amortization Expenses (Detail) - USD ($) $ in Thousands | Mar. 31, 2020 | Sep. 30, 2019 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
Remaining fiscal 2020 | $ 2,343 | |
2021 | 4,687 | |
2022 | 4,687 | |
2023 | 3,840 | |
2024 | 3,558 | |
2025 and thereafter | 7,608 | |
Net Carrying Amount | $ 26,723 | $ 29,131 |
Derivative Instruments and He_2
Derivative Instruments and Hedging (Details) - Cash flow hedging - Foreign currency exchange contracts - USD ($) $ in Millions | 6 Months Ended | |
Mar. 31, 2020 | Sep. 30, 2019 | |
Derivative [Line Items] | ||
Foreign exchange contract terms | 12 months | |
Derivative liability, current | $ 0.4 | |
Notional amount | $ 7.9 | $ 9.4 |
Debt - Term Loan Wells Fargo Ad
Debt - Term Loan Wells Fargo Additional Information (Detail) - USD ($) | Aug. 12, 2019 | Jul. 01, 2019 | Jan. 02, 2019 | May 04, 2018 | Jan. 31, 2020 | Mar. 31, 2020 | Mar. 31, 2020 | Mar. 31, 2019 |
Debt Instrument [Line Items] | ||||||||
Principal payment | $ 5,000,000 | $ 5,000,000 | ||||||
Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Minimum leverage ratio | 350.00% | |||||||
Credit Agreement | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Financial covenants | $ 15,000,000 | |||||||
Credit Agreement | Minimum | Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.50% | |||||||
Credit Agreement | Minimum | LIBOR Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 2.50% | |||||||
Credit Agreement | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Consolidated liquidity | 30,000,000 | |||||||
Credit Agreement | Maximum | Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 3.50% | |||||||
Credit Agreement | Maximum | LIBOR Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 4.50% | |||||||
Credit Agreement | Revolving Loan | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Unused line fee percentage | 0.50% | |||||||
Credit Agreement | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal payment | $ 5,000,000 | $ 4,800,000 | ||||||
Revolving Loan | Credit Agreement | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Unused line fee percentage | 0.25% | |||||||
Wells Fargo Bank National Association | Credit Agreement | LIBOR Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 3.50% | 2.50% | ||||||
Wells Fargo Bank National Association | Credit Agreement | Revolving Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Revolving line of credit, aggregate principal amount | 5,000,000 | $ 5,000,000 | $ 5,000,000 | |||||
Wells Fargo Bank National Association | Credit Agreement | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | 50,000,000 | |||||||
Revitas Inc. | Financing Agreement | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal payment | $ 50,000,000 |
Debt - Promissory Note Addition
Debt - Promissory Note Additional Information (Detail) | Jan. 05, 2020USD ($) | Jul. 01, 2019USD ($) | Jan. 02, 2019USD ($) | Jul. 05, 2018USD ($) | Jan. 05, 2017USD ($)PromissoryNote | Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | May 04, 2018USD ($) |
Debt Instrument [Line Items] | ||||||||
Principal payment | $ 5,000,000 | $ 5,000,000 | ||||||
Credit Agreement | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal payment | $ 5,000,000 | $ 4,800,000 | ||||||
Promissory Note One | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal payment | $ 5,000,000 | |||||||
Promissory Note Two | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 5,000,000 | |||||||
Principal payment | $ 5,000,000 | |||||||
Revitas Inc. | Promissory Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 10,000,000 | |||||||
Number of promissory notes issued | PromissoryNote | 2 | |||||||
Revitas Inc. | Promissory Note One | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 5,000,000 | |||||||
Wells Fargo Bank National Association | Credit Agreement | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 50,000,000 | |||||||
Effective interest rate | 5.08% |
Debt - Schedule of Term Loan wi
Debt - Schedule of Term Loan with Wells Fargo and Promissory Notes (Detail) $ in Thousands | Mar. 31, 2020USD ($) |
Debt Disclosure [Abstract] | |
Principal | $ 39,750 |
Unamortized debt discount and issuance costs | (327) |
Net carrying amount | $ 39,423 |
Debt - Schedule of Future Princ
Debt - Schedule of Future Principal Payments for Term Loan with Wells Fargo and Promissory Notes (Detail) $ in Thousands | Mar. 31, 2020USD ($) |
Fiscal Year | |
Remaining fiscal 2020 | $ 0 |
2021 | 2,609 |
2022 | 3,331 |
2023 | 33,810 |
Total | $ 39,750 |
Stockholders' Equity - Componen
Stockholders' Equity - Component of Stockholders' Equity (Detail) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Oct. 01, 2018 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Balance at beginning of period | $ 59,338 | $ 50,117 | $ 52,722 | $ 40,034 | |
Cumulative effect of a change in accounting principal | $ 10,384 | ||||
Issuance of common stock upon exercise of stock options | 275 | 351 | 293 | 387 | |
Issuance of common stock upon release of restricted stock units | 0 | 0 | 0 | 0 | |
Issuance of common stock upon ESPP purchase | 1,949 | 1,631 | 1,949 | 1,631 | |
Stock-based compensation | 6,009 | 4,896 | 15,562 | 9,099 | |
Other comprehensive income (loss) | (720) | 105 | (677) | 291 | |
Net loss | (4,629) | (5,908) | (7,627) | (10,634) | |
Balance at end of period | $ 62,222 | $ 51,192 | $ 62,222 | $ 51,192 | |
Common Stock | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Balance at beginning of period (in shares) | 33,334 | 31,535 | 32,995 | 31,444 | |
Balance at beginning of period | $ 5 | $ 5 | $ 5 | $ 5 | |
Issuance of common stock upon exercise of stock options (in shares) | 27 | 55 | 30 | 62 | |
Issuance of common stock upon release of restricted stock units (in shares) | 803 | 772 | 1,139 | 856 | |
Issuance of common stock upon ESPP purchase (in shares) | 85 | 119 | 85 | 119 | |
Balance at end of period (in shares) | 34,249 | 32,481 | 34,249 | 32,481 | |
Balance at end of period | $ 5 | $ 5 | $ 5 | $ 5 | |
Additional Paid-In Capital | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Balance at beginning of period | 275,866 | 249,053 | 266,295 | 244,814 | |
Issuance of common stock upon exercise of stock options | 275 | 351 | 293 | 387 | |
Issuance of common stock upon ESPP purchase | 1,949 | 1,631 | 1,949 | 1,631 | |
Stock-based compensation | 6,009 | 4,896 | 15,562 | 9,099 | |
Balance at end of period | 284,099 | 255,931 | 284,099 | 255,931 | |
Accumulated Other Comprehensive Loss | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Balance at beginning of period | (1,126) | (1,099) | (1,169) | (1,285) | |
Other comprehensive income (loss) | (720) | 105 | (677) | 291 | |
Balance at end of period | (1,846) | (994) | (1,846) | (994) | |
Accumulated Deficit | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Balance at beginning of period | (215,407) | (197,842) | (212,409) | (203,500) | |
Cumulative effect of a change in accounting principal | $ 10,384 | ||||
Net loss | (4,629) | (5,908) | (7,627) | (10,634) | |
Balance at end of period | $ (220,036) | $ (203,750) | $ (220,036) | $ (203,750) |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) $ in Millions | 6 Months Ended |
Mar. 31, 2020USD ($) | |
Equity [Abstract] | |
Additional paid in capital, restricted stock unit grants, portion of bonus recorded as stock-based compensation | $ 3.7 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) shares in Millions | Mar. 31, 2020shares |
Share-based Payment Arrangement [Abstract] | |
Number of shares available for future stock awards (in shares) | 2.8 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Restricted Stock Unit Activity (Including Performance Based Restricted Stock Awards) Under All Equity Award Plans (Detail) - Restricted Stock Units shares in Thousands | 6 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Restricted Stock Units Outstanding (in thousands) | |
Balance at beginning of period (in shares) | shares | 2,350 |
Granted (in shares) | shares | 1,286 |
Released (in shares) | shares | (1,139) |
Forfeited (in shares) | shares | (86) |
Balance at end of period (in shares) | shares | 2,411 |
Weighted Average Grant Date Fair Value | |
Balance at beginning of period (in dollars per share) | $ / shares | $ 16.36 |
Granted (in dollars per share) | $ / shares | 28.56 |
Released (in dollars per share) | $ / shares | 19.59 |
Forfeited (in dollars per share) | $ / shares | 18.61 |
Balance at end of period (in dollars per share) | $ / shares | $ 21.26 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Allocated Stock-based Compensation (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | $ 6,009 | $ 4,896 | $ 11,832 | $ 9,099 |
Total stock-based compensation in cost of revenues | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | 1,055 | 1,030 | 2,174 | 1,969 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | 1,243 | 861 | 2,669 | 1,625 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | 1,656 | 1,239 | 3,062 | 2,384 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | 2,055 | 1,766 | 3,927 | 3,121 |
Total stock-based compensation in operating expenses | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | 4,954 | 3,866 | 9,658 | 7,130 |
Subscription | Total stock-based compensation in cost of revenues | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | 495 | 469 | 1,017 | 929 |
Professional services | Total stock-based compensation in cost of revenues | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | $ 560 | $ 561 | $ 1,157 | $ 1,040 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Detail) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense | $ 339,000 | $ 141,000 | $ 328,000 | $ 739,000 |
Effective income tax (benefit) expense, rate | (7.90%) | (2.40%) | (4.50%) | (7.50%) |
Foreign subsidiary earnings repatriated | $ 1,000,000 | |||
Foreign withholding tax paid | 200,000 | |||
Benefit realized for current period losses | $ 0 | $ 0 |
Net Loss Per Share - Computatio
Net Loss Per Share - Computation of Basic and Diluted Net Loss per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Basic and diluted | ||||
Net loss attributable to common stockholders | $ (4,629) | $ (5,908) | $ (7,627) | $ (10,634) |
Denominator, Basic and diluted | ||||
Weighted average shares used in computing net loss per share attributable to common stockholders (in shares) | 33,794 | 31,999 | 33,468 | 31,741 |
Net loss per share attributable to common stockholders: | ||||
Basic and diluted (in dollars per share) | $ (0.14) | $ (0.18) | $ (0.23) | $ (0.34) |
Net Loss Per Share - Summary of
Net Loss Per Share - Summary of Weighted Average Shares of Common Stock Equivalents Excluded from Computation of Diluted Net Loss per Share Attributable to Common Stockholders (Detail) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 58 | 93 | 64 | 100 |
Performance-based RSUs and RSUs | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 1,318 | 1,524 | 1,455 | 1,643 |
Geographic Information - Narrat
Geographic Information - Narrative (Detail) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020activitysegment | Mar. 31, 2019 | |
Segment Reporting Information [Line Items] | ||||
Number of operating segment | segment | 1 | |||
Number of business activity | activity | 1 | |||
Outside of United States | Revenue | Geographic concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Revenues from customers outside United States | 10.00% | 18.00% | 9.00% | 17.00% |
Geographic Information - Compan
Geographic Information - Company's Property and Equipment, Net by Geographic Region (Detail) - USD ($) $ in Thousands | Mar. 31, 2020 | Sep. 30, 2019 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, net | $ 726 | $ 1,043 |
United States | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, net | 591 | 853 |
India | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, net | $ 135 | $ 190 |