Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 30, 2020 | |
Entity Listings [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-35469 | |
Entity Registrant Name | VOCERA COMMUNICATIONS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 94-3354663 | |
Entity Address, Address Line One | 525 Race Street | |
Entity Address, City or Town | San Jose | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 95126 | |
City Area Code | 408 | |
Local Phone Number | 882-5100 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 32,025,518 | |
Entity Central Index Key | 0001129260 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
New York Stock Exchange | ||
Entity Listings [Line Items] | ||
Title of 12(b) Security | Common Stock, $0.0003 par value | |
Trading Symbol | VCRA | |
Security Exchange Name | NYSE |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 31,136 | $ 25,704 |
Short-term investments | 202,632 | 204,164 |
Accounts receivable, net of allowance | 26,283 | 42,547 |
Other receivables | 6,374 | 6,312 |
Inventories | 6,027 | 4,576 |
Prepaid expenses and other current assets | 5,694 | 5,149 |
Total current assets | 278,146 | 288,452 |
Property and equipment, net | 8,251 | 8,661 |
Other long-term assets | 5,590 | |
Intangible assets, net | 5,141 | 5,461 |
Goodwill | 49,246 | 49,246 |
Deferred commissions | 10,307 | 10,477 |
Other long-term assets | 7,368 | 8,158 |
Total assets | 358,459 | 370,455 |
Current liabilities | ||
Accounts payable | 3,142 | 6,036 |
Accrued payroll and other current liabilities | 15,311 | 14,757 |
Deferred revenue, current | 45,987 | 50,033 |
Total current liabilities | 64,440 | 70,826 |
Deferred revenue, long-term | 10,689 | 11,442 |
Convertible senior notes, net | 118,913 | 117,178 |
Other long-term liabilities | 4,116 | |
Other long-term liabilities | 6,310 | 7,184 |
Total liabilities | 200,352 | 206,630 |
Commitments and contingencies (Note 9) | ||
Stockholders' equity | ||
Preferred stock, $0.0003 par value - 5,000,000 shares authorized as of March 31, 2020 and December 31, 2019; zero shares issued and outstanding | 0 | 0 |
Common stock, $0.0003 par value - 100,000,000 shares authorized as of March 31, 2020 and December 31, 2019; 31,802,779 and 31,660,709 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively | 9 | 9 |
Additional paid-in capital | 319,671 | 313,963 |
Accumulated other comprehensive income (loss) | (777) | 179 |
Accumulated deficit | (160,796) | (150,326) |
Total stockholders’ equity | 158,107 | 163,825 |
Total liabilities and stockholders’ equity | $ 358,459 | $ 370,455 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets Condensed Consolidated Balance Sheets (Paranthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Liabilities and stockholders' equity | ||
Common stock par value | $ 0.0003 | $ 0.0003 |
Common stock shares authorized | 100,000,000 | 100,000,000 |
Common stock shares issued | 31,802,779 | 31,660,709 |
Common stock shares outstanding | 31,802,779 | 31,660,709 |
Preferred Stock | ||
Liabilities and stockholders' equity | ||
Preferred stock par value | $ 0.0003 | $ 0.0003 |
Preferred stock shares authorized | 5,000,000 | 5,000,000 |
Preferred stock shares issued | 0 | 0 |
Preferred stock shares outstanding | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue | ||
Total revenue | $ 40,673,000 | $ 35,309,000 |
Cost of revenue | ||
Total cost of revenue | 16,887,000 | 15,624,000 |
Gross profit | 23,786,000 | 19,685,000 |
Operating expenses | ||
Research and development | 9,032,000 | 8,146,000 |
Sales and marketing | 16,963,000 | 16,019,000 |
General and administrative | 6,391,000 | 6,580,000 |
Total operating expenses | 32,386,000 | 30,745,000 |
Loss from operations | (8,600,000) | (11,060,000) |
Interest income | 1,120,000 | 1,279,000 |
Interest expense | (2,274,000) | (2,121,000) |
Other income (expense), net | (591,000) | 131,000 |
Loss before income taxes | (10,345,000) | (11,771,000) |
Benefit from (provision for) income taxes | (125,000) | 36,000 |
Net loss | (10,470,000) | $ (11,735,000) |
Weighted average shares used to compute net loss per share | ||
Basic and Diluted | 30,800 | |
Product | ||
Revenue | ||
Total revenue | 17,850,000 | $ 14,003,000 |
Cost of revenue | ||
Total cost of revenue | 6,364,000 | 5,334,000 |
Service | ||
Revenue | ||
Total revenue | 22,823,000 | 21,306,000 |
Cost of revenue | ||
Total cost of revenue | $ 10,523,000 | $ 10,290,000 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (10,470) | $ (11,735) |
Other comprehensive income (loss), net: | ||
Change in unrealized gain (loss) on investments, net of tax | (956) | 425 |
Comprehensive loss | $ (11,426) | $ (11,310) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities | ||
Net loss | $ (10,470) | $ (11,735) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 1,333 | 1,890 |
Inventory provision | 42 | 0 |
Change in lease-related performance liabilities | (346) | (266) |
Stock-based compensation expense | 5,841 | 5,544 |
Amortization of debt discount and issuance costs | 1,735 | 1,582 |
Other | 729 | 24 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 16,264 | 15,681 |
Other receivables | (102) | (1,156) |
Inventories | (1,494) | (1,637) |
Prepaid expenses and other assets | (417) | (414) |
Deferred commissions | 171 | (19) |
Accounts payable | (2,826) | (1,173) |
Increase (Decrease) in Other Accrued Liabilities | (17) | (1,689) |
Deferred revenue | (4,799) | (5,687) |
Net cash used in operating activities | 5,644 | 945 |
Cash flows from investing activities | ||
Purchase of property and equipment | (682) | (853) |
Purchase of short-term investments | (28,009) | (31,349) |
Maturities of short-term investments | 28,569 | 29,624 |
Net cash used in investing activities | (122) | (2,578) |
Cash flows from financing activities | ||
Cash from lease-related performance obligations | 43 | 0 |
Payment for purchase of capped calls | (8,907) | |
Proceeds from exercise of stock options | 731 | 1,564 |
Tax withholdings paid on behalf of employees for net share settlement | (864) | (1,271) |
Net cash provided by financing activities | (90) | 293 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect | 5,432 | (1,340) |
Cash and cash equivalents at beginning of period | 25,704 | 34,276 |
Cash and cash equivalents at end of period | 31,136 | 32,936 |
Supplemental disclosure of non-cash investing and financing activities: | ||
Property and equipment in accounts payable and accrued liabilities | $ 390 | $ 161 |
Condensed Consolidated Statem_4
Condensed Consolidated Statement of SHareholders Equity Statement - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | AOCI Attributable to Parent [Member] | Retained Earnings [Member] | Restricted stock units | Restricted stock unitsCommon Stock [Member] | Restricted stock unitsAdditional Paid-in Capital [Member] | Convertible Senior Notes At 1.50%, Option PortionConvertible Debt |
Shares, Outstanding | 30,708,138 | ||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 162,867 | $ 9 | $ 295,647 | $ (443) | $ (132,346) | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 122,376 | ||||||||
Stock Issued During Period, Value, Stock Options Exercised | 1,564 | 1,564 | |||||||
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings | 60,603 | ||||||||
Adjustments to Additional Paid in Capital, Other | (1,271) | $ (1,271) | |||||||
APIC, Share-based Payment Arrangement, Increase for Cost Recognition | 5,544 | 5,544 | |||||||
Net loss | (11,735) | (11,735) | |||||||
Change in unrealized gain (loss) on investments, net of tax | 425 | 425 | |||||||
Shares, Outstanding | 30,891,117 | ||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 157,394 | $ 9 | 301,484 | (18) | (144,081) | ||||
Shares, Outstanding | 31,660,709 | ||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 163,825 | $ 9 | 313,963 | 179 | (150,326) | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 77,909 | ||||||||
Stock Issued During Period, Value, Stock Options Exercised | 731 | 731 | |||||||
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings | 64,161 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 101,431 | ||||||||
Adjustments to Additional Paid in Capital, Other | (864) | $ (864) | |||||||
APIC, Share-based Payment Arrangement, Increase for Cost Recognition | 5,841 | 5,841 | |||||||
Net loss | (10,470) | (10,470) | |||||||
Change in unrealized gain (loss) on investments, net of tax | (956) | (956) | |||||||
Shares, Outstanding | 31,802,779 | ||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 158,107 | $ 9 | $ 319,671 | $ (777) | $ (160,796) | ||||
Carrying amount of equity component, net of capped calls | $ 23,307 |
The Company and Summary of Sign
The Company and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
The Company and Summary of Significant Accounting Policies | The Company and Summary of Significant Accounting Policies Organization and Business Vocera Communications, Inc. and its subsidiaries (collectively the “Company” or “Vocera”) is a provider of secure, integrated, intelligent communication and clinical workflow solutions, focused on empowering mobile workers in healthcare, hospitality, retail, energy, education and other mission-critical mobile work environments, in the United States and internationally. The significant majority of the Company’s business is generated from sales of its solutions in the healthcare market to help its customers improve quality of care, safety, patient and staff experience and increase operational efficiency. The Vocera communication and collaboration solution includes: an intelligent enterprise software platform; a lightweight, wearable, voice-controlled communication badge and newly introduced Smartbadge; and smartphone applications. The solution enables users to connect instantly with other staff simply by saying the name, function or group name of the desired recipient. It also delivers HIPAA-compliant secure text messages, alerts and alarms directly to the Vocera Badge, Vocera Smartbadge, smartphones and other mobile communication devices both inside and outside the hospital, replacing legacy pagers and in-building wireless phones. Basis of Presentation The Company’s unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), pursuant to the instructions to Form 10-Q and Article 10 of Regulation S-X of the U.S. Securities and Exchange Commission, and include the accounts of Vocera and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated. Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these unaudited interim condensed consolidated financial statements should be read in conjunction with the annual audited consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 . The year-end condensed consolidated balance sheet data was derived from the Company’s audited financial statements but does not include all disclosures required by GAAP. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s interim consolidated financial information. The results for the quarter presented are not necessarily indicative of the results to be expected for the year ending December 31, 2020 or for any other interim period or any other future year. Except for the change in certain accounting policies upon adoption of the accounting standards described below, there have been no material changes to the Company’s significant accounting policies compared to the accounting policies presented in Note 1 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. Use of Estimates The preparation of the accompanying unaudited condensed consolidated financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting periods. The estimates include, but are not limited to, revenue recognition, warranty reserves, accounts receivable reserves, inventory reserves, bonuses, goodwill and intangible assets, stock-based compensation expense, provisions for income taxes and contingencies. Actual results could differ from these estimates, and such differences could be material to the Company’s financial position and results of operations. Recently Adopted Accounting Pronouncements In June 2016, the FASB issued new guidance related to the accounting for credit losses on instruments for both financial services and non-financial services entities. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. The new guidance was effective for the Company beginning January 1, 2020. The Company applied the guidance using a modified retrospective approach requiring that the Company recognize the cumulative effect of initially applying the impairment standard as an adjustment to opening accumulated deficit in the period of initial application. There was no adjustment to the Company’s opening accumulated deficit in the period as there were no incremental impairment losses as a result of the adoption. In January 2017, the FASB issued new guidance to simplify the accounting for goodwill impairment. The guidance simplifies the measurement of goodwill impairment by removing step 2 of the goodwill impairment test, which requires the determination of the fair value of individual assets and liabilities of a reporting unit. The new guidance requires goodwill impairment to be measured as the amount by which a reporting unit’s carrying value exceeds its fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The amendments should be applied on a prospective basis. The new standard was effective for the Company beginning January 1, 2020. The adoption of this guidance did not have an impact on the Company’s condensed consolidated financial statements. Recent Accounting Pronouncements In December 2019, the FASB issued new guidance to simplifying the accounting for income taxes, which removes certain exceptions for intra period allocations, recognizing deferred taxes for investments and calculating income taxes in interim periods. This guidance also reduces complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. The new standard is effective for the Company for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company is evaluating the impact of this new accounting guidance on its condensed consolidated financial statements. |
Revenue, deferred revenue, and
Revenue, deferred revenue, and deferred commissions | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, deferred revenue, and deferred commissions | Revenue, deferred revenue and deferred commissions Disaggregation of Revenue A typical sales arrangement involves multiple arrangements, such as the sales of the Company’s proprietary communication device (“Vocera Badge”), perpetual software licenses, professional services and maintenance and support services which entitle customers to unspecified upgrades, patch releases and telephone-based support. The following table depicts the disaggregation of revenue according to revenue type and is consistent with how the Company evaluates its financial performance: Three months ended March 31, (in thousands) 2020 2019 Product revenue Device $ 13,903 $ 10,060 Software 3,947 3,943 Total product 17,850 14,003 Service revenue Maintenance and support 18,069 16,393 Professional services and training 4,754 4,913 Total service 22,823 21,306 Total revenue $ 40,673 $ 35,309 Contract balances The timing of revenue recognition may differ from the timing of invoicing to customers. Accounts receivable are recorded at the invoiced amount and in the period the Company delivers goods or provides services or when the Company’s right to consideration is unconditional. Payment terms on invoiced amounts are typically 30 days. The balance of accounts receivable, net of allowance for doubtful accounts, as of March 31, 2020 and December 31, 2019 is presented in the accompanying condensed consolidated balance sheets. In situations where revenue recognition occurs before invoicing, an unbilled receivable is created, which represents a contract asset. As of March 31, 2020 and December 31, 2019, contract assets totaling $4.5 million and $4.3 million , respectively, were included in prepaid and other current assets in the condensed consolidated balance sheets. Costs to obtain and fulfill a contract The Company capitalizes certain incremental contract acquisition costs consisting primarily of commissions paid and the related payroll taxes when customer contracts are signed. The Company determines whether costs should be deferred based on its sales compensation plans, if the commissions are incremental and would not have been incurred absent the execution of the customer contract. Sales commissions for renewals of customer contracts are not commensurate with the commissions paid for the acquisition of the initial contract given the substantive difference in commission rates in proportion to their respective contract values. Commissions paid upon the initial acquisition of a contract are amortized over the estimated period of benefit, which may exceed the term of the initial contract. Accordingly, amortization of deferred costs is recognized on a systematic basis that is consistent with the pattern of revenue recognition allocated to each performance obligation and is included in sales and marketing expense in the condensed consolidated statements of operations. The Company determines its estimated period of benefit by evaluating the expected renewals of its customer contracts, the duration of its relationships with its customers and other factors. Deferred costs are periodically reviewed for impairment. Changes in the balance of total deferred commissions (contract asset) during the three months ended March 31, 2020 are as follows: (in thousands) December 31, 2019 Additions Commissions Recognized March 31, 2020 Deferred commissions $ 10,477 $ 2,489 $ (2,659 ) $ 10,307 Of the $10.3 million total deferred commissions balance as of March 31, 2020 , the Company expects to recognize approximately 48% as commission expense over the next 12 months and the remainder thereafter. Deferred revenue The Company records deferred revenue when cash payments are received in advance of the performance under the contract. The current portion of deferred revenue represents the amounts that are expected to be recognized as revenue within one year of the condensed consolidated balance sheet date. Changes in the balance of total deferred revenue (contract liability) during the three months ended March 31, 2020 are as follows: (in thousands) December 31, 2019 Additions Revenue Recognized March 31, 2020 Deferred revenue $ 61,475 $ 14,945 $ (19,744 ) $ 56,676 Revenue recognized during the three months ended March 31, 2020 from deferred revenue balances at the beginning of the period was $18.5 million . Revenue recognized during the three months ended March 31, 2019 from deferred revenue balances at the beginning of the period was $15.2 million . The “contracted but not recognized” performance obligations represent the Company’s deferred revenue and non-cancelable backlog amounts. This balance as of March 31, 2020 was $112.5 million , of which the Company expects to recognize approximately 66% as revenue over the next 12 months and the remainder thereafter. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s cash, cash equivalents and short-term investments are carried at their fair values with any differences from their amortized cost recorded in equity as unrealized gains (losses) on marketable securities. As a basis for determining the fair value of its assets and liabilities, the Company follows a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs other than the quoted prices in active markets that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data which requires the Company to develop its own assumptions. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. During the three months ended March 31, 2020 , there have been no transfers between Level 1 and Level 2 fair value instruments and no transfers in or out of Level 3. The Company’s money market funds are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. The fair value of the Company’s Level 2 fixed income securities is obtained from independent pricing services, which may use quoted market prices for identical or comparable instruments or model-driven valuations using observable market data or other inputs, corroborated by observable market data. The Company does not have any financial instruments which are valued using Level 3 inputs. In addition to its cash, cash equivalents and short-term investments, the Company measures the fair value of its Convertible Senior Notes on a quarterly basis for disclosure purposes. The Company considers the fair value of the Convertible Senior Notes at March 31, 2020 to be a Level 2 measurement due to limited trading activity of the Convertible Senior Notes. Refer to Note 8 to the condensed consolidated financial statements for further information. The Company’s assets that are measured at fair value on a recurring basis, by level, within the fair value hierarchy as of March 31, 2020 and December 31, 2019 , are summarized as follows (in thousands): March 31, 2020 December 31, 2019 Level 1 Level 2 Total Level 1 Level 2 Total Assets Money market funds $ 3,855 $ — $ 3,855 $ 4,086 $ — $ 4,086 Commercial paper — 17,899 17,899 — 12,854 12,854 U.S. government agency securities — — — — 3,000 3,000 Corporate debt securities — 186,725 186,725 — 188,310 188,310 Total assets measured at fair value $ 3,855 $ 204,624 $ 208,479 $ 4,086 $ 204,164 $ 208,250 |
Cash, Cash Equivalents and Shor
Cash, Cash Equivalents and Short-term Investments | 3 Months Ended |
Mar. 31, 2020 | |
Cash and Cash Equivalents [Abstract] | |
Cash, Cash Equivalents, and Short-term Investments | Cash, Cash Equivalents and Short-Term Investments The following tables present cash, cash equivalents and short-term investments (in thousands) as of March 31, 2020 and December 31, 2019 : As of March 31, 2020 Amortized Cost Unrealized Gains Unrealized Losses Fair value Cash and cash equivalents: Demand deposits and other cash $ 25,289 $ — $ — $ 25,289 Money market funds 3,855 — — 3,855 Commercial paper 1,994 — (2 ) 1,992 Total cash and cash equivalents 31,138 — (2 ) 31,136 Short-Term Investments: Commercial paper 15,911 10 (14 ) 15,907 Corporate debt securities 187,238 296 (809 ) 186,725 Total short-term investments 203,149 306 (823 ) 202,632 Total cash, cash equivalents and short-term investments $ 234,287 $ 306 $ (825 ) $ 233,768 As of December 31, 2019 Amortized Cost Unrealized Gains Unrealized Losses Fair value Cash and cash equivalents: Demand deposits and other cash $ 21,618 $ — $ — $ 21,618 Money market funds 4,086 — — 4,086 Commercial paper — — — — Total cash and cash equivalents 25,704 — — 25,704 Short-Term Investments: Commercial paper 12,861 — (7 ) 12,854 U.S. government agency securities 3,000 — — 3,000 U.S. Treasury securities — — — — Corporate debt securities 187,866 499 (55 ) 188,310 Total short-term investments 203,727 499 (62 ) 204,164 Total cash, cash equivalents and short-term investments $ 229,431 $ 499 $ (62 ) $ 229,868 The Company has determined that the unrealized losses on its short-term investments as of March 31, 2020 and December 31, 2019 do not constitute an “other than temporary impairment.” The unrealized losses for the short-term investments have all been in a continuous unrealized loss position for less than twelve months. The Company’s conclusion of no “other than temporary impairment” is based on the high credit quality of the securities, their short remaining maturity and the Company’s intent and ability to hold such loss securities until maturity. Classification of the cash, cash equivalents and short-term investments by contractual maturity was as follows: (in thousands) One year or shorter Between 1 and 2 years Total Balances as of March 31, 2020 Cash and cash equivalents (1) $ 31,136 $ — $ 31,136 Short-term investments 130,834 71,798 202,632 Cash, cash equivalents and short-term investments $ 161,970 $ 71,798 $ 233,768 Balances as of December 31, 2019 Cash and cash equivalents (1) $ 25,704 $ — $ 25,704 Short-term investments 113,010 91,154 204,164 Cash, cash equivalents and short-term investments $ 138,714 $ 91,154 $ 229,868 (1) Includes demand deposits and other cash, money market funds and other cash equivalent securities, all with 0-90 day maturity at purchase. |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Loss Per Share The following table sets forth the computation of basic and diluted net loss per share (in thousands, except per share amounts): Three months ended March 31, 2020 2019 Numerator: Net loss $ (10,470 ) $ (11,735 ) Denominator: Weighted average shares used to compute net loss per common share - basic 31,738 30,800 Weighted-average shares used to compute net loss per common share - diluted 31,738 30,800 Net loss per share Basic $ (0.33 ) $ (0.38 ) Diluted $ (0.33 ) $ (0.38 ) The following securities were not included in the calculation of diluted shares outstanding as the effect would have been anti-dilutive: Three months ended March 31, (in thousands) 2020 2019 Options to purchase common stock, including ESPP 620 724 Restricted stock units 1,635 1,850 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill As of March 31, 2020 and December 31, 2019 , the Company had $49.2 million and $49.2 million of goodwill, respectively, with $41.2 million and $8.0 million allocated to the Company’s Product and Services operating segments, respectively. As of March 31, 2020 , there were no changes in circumstances indicating that the carrying values of goodwill or acquired intangibles may not be recoverable. Intangible Assets Acquisition-related intangible assets are amortized either straight-line, or over the life of the assets on a basis that resembles the economic benefit of the assets. This yields amortization in the latter case that is higher in earlier periods of the useful life. The estimated useful lives and carrying value of acquired intangible assets are as follows: March 31, 2020 December 31, 2019 (in thousands) Range of Useful Life (years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology 3 to 7 $ 10,050 $ 9,854 $ 196 $ 10,050 $ 9,803 $ 247 Customer relationships 7 to 9 10,920 6,088 4,832 10,920 5,819 5,101 Backlog 3 1,400 1,287 113 1,400 1,287 113 Non-compete agreements 2 to 4 460 460 — 460 460 — Trademarks 3 to 7 1,110 1,110 — 1,110 1,110 — Intangible assets, net book value $ 23,940 $ 18,799 $ 5,141 $ 23,940 $ 18,479 $ 5,461 Amortization expense was $0.3 million and $1.0 million for the three months ended March 31, 2020 and 2019 , respectively. Amortization of acquired intangible assets is reflected in the cost of revenue for developed technology and backlog and in operating expenses for the other intangible assets. The estimated future amortization of existing acquired intangible assets as of March 31, 2020 was as follows: (in thousands) Future amortization 2020 (remaining nine months) $ 1,036 2021 1,130 2022 1,050 2023 1,050 2024 875 Future amortization expense $ 5,141 |
Balance Sheet Components
Balance Sheet Components | 3 Months Ended |
Mar. 31, 2020 | |
Balance Sheet Components [Abstract] | |
Balance Sheet Components | Balance Sheet Components Inventories (in thousands) March 31, December 31, Raw materials $ 962 $ 831 Finished goods 5,065 3,745 Total inventories $ 6,027 $ 4,576 Property and equipment, net (in thousands) March 31, December 31, Computer equipment and software $ 14,088 $ 13,596 Furniture, fixtures and equipment 2,554 2,430 Leasehold improvements 5,351 5,283 Manufacturing tools and equipment 2,476 2,435 Construction in process 131 582 Property and equipment, at cost 24,600 24,326 Less: Accumulated depreciation (16,349 ) (15,665 ) Property and equipment, net $ 8,251 $ 8,661 Depreciation and amortization expense for property and equipment was $1.0 million and $0.9 million for the three months ended March 31, 2020 and 2019 , respectively. Net investment in sales-type leases The Company has sales-type leases with terms of 3 to 4 years. Sales-type lease receivables are collateralized by the underlying equipment. The components of the Company’s net investment in sales-type leases are as follows: (in thousands) March 31, December 31, Minimum payments to be received on sales-type leases $ 1,796 $ 2,078 Less: Unearned interest income and executory revenue portion (1,097 ) (1,190 ) Net investment in sales-type leases 699 888 Less: Current portion (346 ) (452 ) Non-current net investment in sales-type leases $ 353 $ 436 Sales-type lease activity recognized in the condensed consolidated statement of operations are as follows: Three months ended March 31, (in thousands) 2020 2019 Lease revenue $ 435 $ 661 Less: Cost of lease shipments (10 ) (52 ) Gross profit 425 609 Interest income (expense), net on lease receivable $ (6 ) $ (3 ) Initial direct cost incurred $ 23 $ 31 There were no allowances for doubtful accounts on these leases as of March 31, 2020 and December 31, 2019 . There is no guaranteed or unguaranteed residual value on the leased equipment. The current and non-current net investments in sales-type leases are reported as components of the condensed consolidated balance sheet captions “other receivables” and “other long-term assets,” respectively. The minimum payments expected to be received for future years under sales-type leases as of March 31, 2020 were as follows: (in thousands) Future lease payments 2020 (remaining nine months) $ 716 2021 615 2022 387 2023 78 Total $ 1,796 Accrued payroll and other current liabilities (in thousands) March 31, December 31, Payroll and related expenses $ 7,276 $ 6,053 Accrued payables 1,707 2,674 Operating lease liabilities, current portion 2,336 2,323 Lease financing, current portion 898 1,033 Product warranty 440 420 Customer prepayments 665 631 Sales and use tax payable 469 599 Other 1,520 1,024 Total accrued payroll and other current liabilities $ 15,311 $ 14,757 The changes in the Company’s product warranty reserve are as follows: Three months ended March 31, (in thousands) 2020 2019 Warranty balance at the beginning of the period $ 420 $ 376 Warranty expense accrued for shipments during the period 108 77 Changes in estimate related to pre-existing warranties (31 ) (31 ) Warranty settlements made (57 ) (48 ) Total product warranty $ 440 $ 374 Leases The Company has operating leases for office space at its headquarters and subsidiaries under non-cancelable operating leases. Leases with an initial term of 12 months or less are not recorded on the balance sheet; lease expense for these leases is recognized on a straight-line basis over the lease term. The Company’s leases have remaining lease terms of approximately ten months to approximately five years. Operating lease cost, including short-term operating leases was $0.7 million and $0.6 million for the three months ended March 31, 2020 and 2019, respectively. Supplemental balance sheet information related to leases was as follows: (in thousands) March 31, Other long-term assets $ 5,590 Accrued payroll and other current liabilities 2,336 Other long-term liabilities 4,116 Total operating lease liabilities $ 6,452 Other information related to leases was as follows: Three months ended March 31, Three months ended March 31, (in thousands) 2020 2019 Supplemental Cash Flow Information Cash paid for amounts included in the measurement of lease liabilities $ 712 $ 630 Right-of-use assets obtained in exchange for lease obligations $ — $ 689 Weighted average remaining lease term 2.39 years 3.11 years Weighted average discount rate 8 % 8 % Maturities of lease liabilities as of March 31, 2020 are as follows: (in thousands) Operating leases 2020 (remaining nine months) $ 2,191 2021 2,960 2022 1,326 2023 403 2024 319 Total maturities of lease liabilities 7,199 Less imputed interest $ (747 ) Total $ 6,452 |
Convertible Senior Notes
Convertible Senior Notes | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | Convertible Senior Notes In May 2018, the Company issued $143.75 million aggregate principal amount of 1.50% Convertible Senior Notes due 2023, including $18.75 million aggregate principal amount of such notes pursuant to the exercise in full of options granted to the initial purchasers, collectively the “Notes.” The Notes are unsecured, unsubordinated obligations and bear interest at a fixed rate of 1.50% per annum, payable semi-annually in arrears on May 15 and November 15 of each year, commencing on November 15, 2018. The total net proceeds from the offering, after deducting initial purchase discounts and estimated debt issuance costs, were approximately $138.9 million . Each $1,000 principal amount of the Notes will initially be convertible into 31.0073 shares of the Company’s common stock, the “Conversion Option,” which is equivalent to an initial conversion price of approximately $32.25 per share, subject to adjustment upon the occurrence of specified events. The Notes will be convertible at the option of the holders at any time prior to the close of business on the business day immediately preceding February 15, 2023, only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on June 30, 2018 (and only during such calendar quarter), if the last reported sale price of the Company common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price of the Notes on each applicable trading day; (2) during the five business day period after any ten consecutive trading day period in which the trading price per $1,000 principal amount of the Notes for each day of that ten day consecutive trading day period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate of the Notes on such trading day; or (3) upon the occurrence of specified corporate events (as set forth in the indenture governing the Notes). On or after February 15, 2023 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their Notes at any time, regardless of the foregoing circumstances. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s election. If certain specified fundamental changes occur (as set forth in the indenture governing the Notes) prior to the maturity date, holders of the Notes may require the Company to repurchase for cash all or any portion of their Notes at a repurchase price equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. In addition, if specific corporate events occur prior to the applicable maturity date, the Company will increase the conversion rate for a holder who elects to convert their notes in connection with such a corporate event in certain circumstances. It is the Company’s current intent and policy to settle conversions through combination settlement which involves repayment of the principal portion in cash and any excess of the conversion value over the principal amount in shares of its common stock. During the three months ended March 31, 2020 , the conditions allowing holders of the Notes to convert have not been met. The Notes are therefore not convertible during the three months ended March 31, 2020 and are classified as long-term debt. In accounting for the transaction, the Notes were separated into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar debt instrument that does not have an associated convertible feature. The carrying amount of the equity component representing the Conversion Option was $33.4 million and was determined by deducting the fair value of the liability component from the par value of the Notes. The equity component was recorded in additional paid-in capital and will be remeasured as long as it continues to meet the conditions for equity classification. The excess of the principal amount of the liability component over its carrying amount, the “debt discount,” is amortized to interest expense over the contractual term of the Notes at an effective interest rate of 7.6% . In accounting for the debt issuance costs of $4.9 million related to the Notes, the Company allocated the total amount incurred to the liability and equity components of the Notes based on their relative values. Issuance costs attributable to the liability component were $3.8 million and will be amortized to interest expense using the effective interest method over the contractual term of the Notes. Issuance costs attributable to the equity component were $1.1 million and are included with the equity component in additional paid-in capital. The Notes consist of the following: (in thousands) March 31, December 31, Liability: Principal $ 143,750 $ 143,750 Unamortized debt discount (22,321 ) (23,880 ) Unamortized issuance costs (2,516 ) (2,692 ) Net carrying amount $ 118,913 $ 117,178 Stockholders’ equity: Debt discount for conversion option $ 33,350 $ 33,350 Issuance costs $ (1,136 ) $ (1,136 ) Net carrying amount $ 32,214 $ 32,214 The total estimated fair value of the Notes as of March 31, 2020 was approximately $142.7 million . The fair value was determined based on the closing trading price per $100 of the Notes as of the last day of trading for the period. The fair value of the Notes is primarily affected by the trading price of the Company’s common stock and market interest rates. Based on the closing price of the Company’s common stock of $21.24 on March 31, 2020, the if-converted value of the Notes of $94.7 million was less than their principal amount. Interest expense related to the Notes is as follows: Three months ended March 31, (in thousands) 2020 2019 Contractual interest expense $ 539 $ 539 Amortization of debt discount 1,559 1,422 Amortization of issuance costs 176 160 Total interest expense $ 2,274 $ 2,121 Capped Calls In connection with the pricing of the Notes, the Company entered into privately negotiated capped call transactions with certain counterparties, the “Capped Calls.” The Capped Calls each have an initial strike price of approximately $32.25 per share, subject to certain adjustments, which correspond to the initial conversion price of the Notes. The Capped Calls have initial cap prices of $38.94 per share, subject to certain adjustments. The Capped Calls cover, subject to anti-dilution adjustments, approximately 4.5 million shares of the Company’s common stock. Conditions that cause adjustments to the initial strike price of the Capped Calls mirror conditions that result in corresponding adjustments for the Notes. The Capped Calls are generally intended to reduce or offset the potential dilution to the Company’s common stock upon any conversion of the Notes with such reduction or offset, as the case may be, subject to a cap based on the cap price. For accounting purposes, the Capped Calls are separate transactions, and not part of the terms of the Notes. As these transactions meet certain accounting criteria, the Capped Calls are recorded in stockholders' equity and are not accounted for as derivatives. The cost of $8.9 million incurred in connection with the Capped Calls was recorded as a reduction to additional paid-in capital. The net impact to the Company’s stockholders' equity, included in additional paid-in capital, of the above components of the Notes is as follows: (in thousands) March 31, Conversion option $ 33,350 Purchase of capped calls $ (8,907 ) Issuance costs $ (1,136 ) Total $ 23,307 Impact on Earnings Per Share The Notes will not have an impact on the Company’s diluted earnings per share until they meet the criteria for conversion, as discussed above, as the Company intends to settle the principal amount of the Notes in cash upon conversion. Under the treasury stock method, in periods when the Company reports net income, the Company is required to include the effect of additional shares that may be issued under the Notes when the price of its’ common stock exceeds the conversion price. However, upon conversion, there will be no economic dilution from the Notes until the average market price of the Company’s common stock exceeds the cap price of $38.94 per share, as exercise of the capped calls offsets any dilution from the Notes from the conversion price up to the cap price. Capped Calls are excluded from the calculation of diluted earnings per share, as they would be anti-dilutive under the treasury stock method. |
Commitments
Commitments | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure | Commitments and Contingencies Non-cancelable Material Commitments The Company is required to purchase unused, non-cancelable, non-returnable raw material inventory that was purchased by its contract manufacturers based on committed finished goods orders from the Company, certain long lead-time raw materials based on the Company’s forecast and current work-in-progress materials. As of March 31, 2020 and December 31, 2019 , approximately $7.6 million and $9.7 million , respectively, of such inventory was purchased and held by the third-party manufacturers which was subject to these purchase guarantees. Indemnifications The Company undertakes, in the ordinary course of business, to (i) defend customers and other parties from certain third-party claims associated with allegations of trade secret misappropriation, infringement of copyright, patent or other intellectual property rights, tortious damage to persons or property or breaches of certain Company obligations relating to confidentiality (e.g., safeguarding protected health information) and (ii) indemnify and hold harmless such parties from certain resulting damages, costs and other liabilities. The term of these undertakings may be perpetual and the maximum potential liability of the Company under certain of these undertakings is not determinable. Based on its historical experience, the Company believes the liability associated with these undertakings is minimal. The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual. The Company currently has directors and officers insurance. As there has been no significant history of losses, no expense accrual has been made. Litigation From time to time, the Company may be involved in lawsuits, claims, investigations and proceedings, consisting of intellectual property, commercial, employment and other matters which arise in the ordinary course of business. The Company defends itself vigorously against any such claims. Although the outcome of these matters is currently not determinable, management expects that any losses from existing matters that are probable or reasonably possible of being incurred as a result of these matters would not be material to the financial statements as a whole. |
Stock-based Compensation and Aw
Stock-based Compensation and Awards | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-based Compensation and Award | Stock-based Compensation and Awards Stock Option Activity A summary of the stock option activity for the three months ended March 31, 2020 is presented below: Options Outstanding Number of options Weighted average exercise price Weighted average remaining contractual term Aggregate intrinsic value (in years) (in thousands) Outstanding at December 31, 2019 606,327 $ 13.41 3.62 $ 4,566 Options granted — — Options exercised (77,909 ) 9.38 Options canceled — — Outstanding at March 31, 2020 528,418 $ 14.01 3.38 $ 3,974 At March 31, 2020 , there was no unrecognized compensation cost related to options. As of March 31, 2020 , there were 1,855,146 shares that remained available for future issuance of options, restricted stock units (“RSUs”) or other equity awards under the 2012 Equity Incentive Plan. Employee Stock Purchase Plan In March 2012, the Company’s 2012 Employee Stock Purchase Plan (the “ESPP”) was approved. No shares of common stock were purchased during the three months ended March 31, 2020 and 2019. As of March 31, 2020 , there were 1,189,618 shares available for future issuance under the ESPP. The following Black-Scholes option-pricing assumptions were used for each respective period for the ESPP: Three months ended March 31, 2020 2019 Expected term (in years) 0.50 0.50 Volatility 50.0% 33.0% Risk-free interest rate 1.59% 2.51% Dividend yield 0% 0% Restricted Stock Units A summary of RSU activity for the three months ended March 31, 2020 is presented below: Restricted Stock Units Number of shares Weighted Average Grant Date Fair Value per Share Outstanding at December 31, 2019 1,550,646 $ 28.94 Granted 203,971 22.84 Vested (101,431 ) 31.08 Forfeited (17,868 ) 28.11 Outstanding at March 31, 2020 1,635,318 $ 28.06 At March 31, 2020 , there was $28.8 million of unrecognized compensation cost related to RSUs, which is expected to be recognized over a weighted-average period of 1.75 years . Allocation of Stock-Based Compensation Expense The following table presents the allocation of stock-based compensation expense: Three months ended March 31, (in thousands) 2020 2019 Cost of revenue $ 973 $ 978 Research and development 966 822 Sales and marketing 1,860 1,720 General and administrative 2,042 2,024 Total stock-based compensation $ 5,841 $ 5,544 |
Segments
Segments | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segments | Segments The Company has two operating segments, which are both reportable business segments: (i) Product and (ii) Service, both of which are comprised of Vocera and its wholly-owned subsidiaries’ results of operations. The following table presents a summary of the operating segments: Three months ended March 31, 2020 2019 (in thousands) Revenue Product $ 17,850 $ 14,003 Service 22,823 21,306 Total revenue 40,673 35,309 Cost of revenue Product 6,364 5,334 Service 10,523 10,290 Total cost of revenue 16,887 15,624 Gross profit Product 11,486 8,669 Service 12,300 11,016 Total gross profit 23,786 19,685 Operating expenses 32,386 30,745 Interest expense, net and other (1,745 ) (711 ) Loss before income taxes $ (10,345 ) $ (11,771 ) |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company recorded a $(0.1) million and $36,000 (provision for) benefit from income taxes for the three months ended March 31, 2020 and 2019 , respectively. The provision recorded for the three months ended March 31, 2020 was primarily due to the accretion of the deferred tax liability associated with indefinite lived intangibles and state income taxes. The benefit recorded for the three months ended March 31, 2019 was primarily due to the tax benefit from the gain recorded in other comprehensive income. As of March 31, 2020 , the Company has provided a valuation allowance against certain federal and state deferred tax assets. Management continues to evaluate the realizability of deferred tax assets and the related valuation allowance. If management’s assessment of the deferred tax assets or the corresponding valuation allowance were to change, the Company would record the related adjustment to income during the period in which management makes the determination. As of March 31, 2020 , there were no material changes to either the nature or the amounts of the uncertain tax positions previously determined for the year ended December 31, 2019 . On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (CARES Act) was enacted and signed into law. The CARES Act, among other things, permits NOL carryovers and carrybacks to offset 100% of taxable income for taxable years beginning before 2021. The Company is currently evaluating the impact of the CARES Act, but at present does not expect the NOL provisions of the CARES Act to result in a material impact to the Company as it has historically generated taxable losses. |
The Company and Summary of Si_2
The Company and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Nature of Operations | Organization and Business Vocera Communications, Inc. and its subsidiaries (collectively the “Company” or “Vocera”) is a provider of secure, integrated, intelligent communication and clinical workflow solutions, focused on empowering mobile workers in healthcare, hospitality, retail, energy, education and other mission-critical mobile work environments, in the United States and internationally. The significant majority of the Company’s business is generated from sales of its solutions in the healthcare market to help its customers improve quality of care, safety, patient and staff experience and increase operational efficiency. The Vocera communication and collaboration solution includes: an intelligent enterprise software platform; a lightweight, wearable, voice-controlled communication badge and newly introduced Smartbadge; and smartphone applications. The solution enables users to connect instantly with other staff simply by saying the name, function or group name of the desired recipient. It also delivers HIPAA-compliant secure text messages, alerts and alarms directly to the Vocera Badge, Vocera Smartbadge, smartphones and other mobile communication devices both inside and outside the hospital, replacing legacy pagers and in-building wireless phones. |
Basis of Presentation | Basis of Presentation The Company’s unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), pursuant to the instructions to Form 10-Q and Article 10 of Regulation S-X of the U.S. Securities and Exchange Commission, and include the accounts of Vocera and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated. Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these unaudited interim condensed consolidated financial statements should be read in conjunction with the annual audited consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 . The year-end condensed consolidated balance sheet data was derived from the Company’s audited financial statements but does not include all disclosures required by GAAP. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s interim consolidated financial information. The results for the quarter presented are not necessarily indicative of the results to be expected for the year ending December 31, 2020 or for any other interim period or any other future year. |
Use of Estimates | Use of Estimates The preparation of the accompanying unaudited condensed consolidated financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting periods. The estimates include, but are not limited to, revenue recognition, warranty reserves, accounts receivable reserves, inventory reserves, bonuses, goodwill and intangible assets, stock-based compensation expense, provisions for income taxes and contingencies. Actual results could differ from these estimates, and such differences could be material to the Company’s financial position and results of operations. |
Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements In June 2016, the FASB issued new guidance related to the accounting for credit losses on instruments for both financial services and non-financial services entities. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. The new guidance was effective for the Company beginning January 1, 2020. The Company applied the guidance using a modified retrospective approach requiring that the Company recognize the cumulative effect of initially applying the impairment standard as an adjustment to opening accumulated deficit in the period of initial application. There was no adjustment to the Company’s opening accumulated deficit in the period as there were no incremental impairment losses as a result of the adoption. In January 2017, the FASB issued new guidance to simplify the accounting for goodwill impairment. The guidance simplifies the measurement of goodwill impairment by removing step 2 of the goodwill impairment test, which requires the determination of the fair value of individual assets and liabilities of a reporting unit. The new guidance requires goodwill impairment to be measured as the amount by which a reporting unit’s carrying value exceeds its fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The amendments should be applied on a prospective basis. The new standard was effective for the Company beginning January 1, 2020. The adoption of this guidance did not have an impact on the Company’s condensed consolidated financial statements. Recent Accounting Pronouncements In December 2019, the FASB issued new guidance to simplifying the accounting for income taxes, which removes certain exceptions for intra period allocations, recognizing deferred taxes for investments and calculating income taxes in interim periods. This guidance also reduces complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. The new standard is effective for the Company for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company is evaluating the impact of this new accounting guidance on its condensed consolidated financial statements. |
Fair Value of Fin. Instruments, Policy | Fair Value of Financial Instruments The Company’s cash, cash equivalents and short-term investments are carried at their fair values with any differences from their amortized cost recorded in equity as unrealized gains (losses) on marketable securities. As a basis for determining the fair value of its assets and liabilities, the Company follows a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs other than the quoted prices in active markets that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data which requires the Company to develop its own assumptions. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. During the three months ended March 31, 2020 , there have been no transfers between Level 1 and Level 2 fair value instruments and no transfers in or out of Level 3. The Company’s money market funds are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. The fair value of the Company’s Level 2 fixed income securities is obtained from independent pricing services, which may use quoted market prices for identical or comparable instruments or model-driven valuations using observable market data or other inputs, corroborated by observable market data. The Company does not have any financial instruments which are valued using Level 3 inputs. |
Goodwill, Policy | Goodwill As of March 31, 2020 and December 31, 2019 , the Company had $49.2 million and $49.2 million of goodwill, respectively, with $41.2 million and $8.0 million allocated to the Company’s Product and Services operating segments, respectively. As of March 31, 2020 |
Intangible Assets, Policy | Intangible Assets Acquisition-related intangible assets are amortized either straight-line, or over the life of the assets on a basis that resembles the economic benefit of the assets. This yields amortization in the latter case that is higher in earlier periods of the useful life. |
Purchase commitments | Non-cancelable Material Commitments The Company is required to purchase unused, non-cancelable, non-returnable raw material inventory that was purchased by its contract manufacturers based on committed finished goods orders from the Company, certain long lead-time raw materials based on the Company’s forecast and current work-in-progress materials. As of March 31, 2020 and December 31, 2019 , approximately $7.6 million and $9.7 million , respectively, of such inventory was purchased and held by the third-party manufacturers which was subject to these purchase guarantees. |
Segment Reporting, Policy | The Company has two operating segments, which are both reportable business segments: (i) Product and (ii) Service, both of which are comprised of Vocera and its wholly-owned subsidiaries’ results of operations. |
Revenue Recognition | Disaggregation of Revenue A typical sales arrangement involves multiple arrangements, such as the sales of the Company’s proprietary communication device (“Vocera Badge”), perpetual software licenses, professional services and maintenance and support services which entitle customers to unspecified upgrades, patch releases and telephone-based support. The following table depicts the disaggregation of revenue according to revenue type and is consistent with how the Company evaluates its financial performance: Three months ended March 31, (in thousands) 2020 2019 Product revenue Device $ 13,903 $ 10,060 Software 3,947 3,943 Total product 17,850 14,003 Service revenue Maintenance and support 18,069 16,393 Professional services and training 4,754 4,913 Total service 22,823 21,306 Total revenue $ 40,673 $ 35,309 Contract balances The timing of revenue recognition may differ from the timing of invoicing to customers. Accounts receivable are recorded at the invoiced amount and in the period the Company delivers goods or provides services or when the Company’s right to consideration is unconditional. Payment terms on invoiced amounts are typically 30 days. The balance of accounts receivable, net of allowance for doubtful accounts, as of March 31, 2020 and December 31, 2019 is presented in the accompanying condensed consolidated balance sheets. In situations where revenue recognition occurs before invoicing, an unbilled receivable is created, which represents a contract asset. As of March 31, 2020 and December 31, 2019, contract assets totaling $4.5 million and $4.3 million , respectively, were included in prepaid and other current assets in the condensed consolidated balance sheets. Costs to obtain and fulfill a contract The Company capitalizes certain incremental contract acquisition costs consisting primarily of commissions paid and the related payroll taxes when customer contracts are signed. The Company determines whether costs should be deferred based on its sales compensation plans, if the commissions are incremental and would not have been incurred absent the execution of the customer contract. Sales commissions for renewals of customer contracts are not commensurate with the commissions paid for the acquisition of the initial contract given the substantive difference in commission rates in proportion to their respective contract values. Commissions paid upon the initial acquisition of a contract are amortized over the estimated period of benefit, which may exceed the term of the initial contract. Accordingly, amortization of deferred costs is recognized on a systematic basis that is consistent with the pattern of revenue recognition allocated to each performance obligation and is included in sales and marketing expense in the condensed consolidated statements of operations. The Company determines its estimated period of benefit by evaluating the expected renewals of its customer contracts, the duration of its relationships with its customers and other factors. Deferred costs are periodically reviewed for impairment. Changes in the balance of total deferred commissions (contract asset) during the three months ended March 31, 2020 are as follows: (in thousands) December 31, 2019 Additions Commissions Recognized March 31, 2020 Deferred commissions $ 10,477 $ 2,489 $ (2,659 ) $ 10,307 Of the $10.3 million total deferred commissions balance as of March 31, 2020 , the Company expects to recognize approximately 48% as commission expense over the next 12 months and the remainder thereafter. Deferred revenue The Company records deferred revenue when cash payments are received in advance of the performance under the contract. The current portion of deferred revenue represents the amounts that are expected to be recognized as revenue within one year of the condensed consolidated balance sheet date. Changes in the balance of total deferred revenue (contract liability) during the three months ended March 31, 2020 are as follows: (in thousands) December 31, 2019 Additions Revenue Recognized March 31, 2020 Deferred revenue $ 61,475 $ 14,945 $ (19,744 ) $ 56,676 Revenue recognized during the three months ended March 31, 2020 from deferred revenue balances at the beginning of the period was $18.5 million . Revenue recognized during the three months ended March 31, 2019 from deferred revenue balances at the beginning of the period was $15.2 million . The “contracted but not recognized” performance obligations represent the Company’s deferred revenue and non-cancelable backlog amounts. This balance as of March 31, 2020 was $112.5 million , of which the Company expects to recognize approximately 66% as revenue over the next 12 months and the remainder thereafter. |
Revenue, deferred revenue, an_2
Revenue, deferred revenue, and deferred commissions (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table depicts the disaggregation of revenue according to revenue type and is consistent with how the Company evaluates its financial performance: Three months ended March 31, (in thousands) 2020 2019 Product revenue Device $ 13,903 $ 10,060 Software 3,947 3,943 Total product 17,850 14,003 Service revenue Maintenance and support 18,069 16,393 Professional services and training 4,754 4,913 Total service 22,823 21,306 Total revenue $ 40,673 $ 35,309 |
Contract with Customer, Asset and Liability | hanges in the balance of total deferred commissions (contract asset) during the three months ended March 31, 2020 are as follows: (in thousands) December 31, 2019 Additions Commissions Recognized March 31, 2020 Deferred commissions $ 10,477 $ 2,489 $ (2,659 ) $ 10,307 (in thousands) December 31, 2019 Additions Revenue Recognized March 31, 2020 Deferred revenue $ 61,475 $ 14,945 $ (19,744 ) $ 56,676 |
Fair Value of Financial Insturm
Fair Value of Financial Insturments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | The Company’s assets that are measured at fair value on a recurring basis, by level, within the fair value hierarchy as of March 31, 2020 and December 31, 2019 , are summarized as follows (in thousands): March 31, 2020 December 31, 2019 Level 1 Level 2 Total Level 1 Level 2 Total Assets Money market funds $ 3,855 $ — $ 3,855 $ 4,086 $ — $ 4,086 Commercial paper — 17,899 17,899 — 12,854 12,854 U.S. government agency securities — — — — 3,000 3,000 Corporate debt securities — 186,725 186,725 — 188,310 188,310 Total assets measured at fair value $ 3,855 $ 204,624 $ 208,479 $ 4,086 $ 204,164 $ 208,250 |
Cash, Cash Equivalents and Sh_2
Cash, Cash Equivalents and Short-term Investments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of Cash, Cash Equivalents and Available-For-Sale Investments | The following tables present cash, cash equivalents and short-term investments (in thousands) as of March 31, 2020 and December 31, 2019 : As of March 31, 2020 Amortized Cost Unrealized Gains Unrealized Losses Fair value Cash and cash equivalents: Demand deposits and other cash $ 25,289 $ — $ — $ 25,289 Money market funds 3,855 — — 3,855 Commercial paper 1,994 — (2 ) 1,992 Total cash and cash equivalents 31,138 — (2 ) 31,136 Short-Term Investments: Commercial paper 15,911 10 (14 ) 15,907 Corporate debt securities 187,238 296 (809 ) 186,725 Total short-term investments 203,149 306 (823 ) 202,632 Total cash, cash equivalents and short-term investments $ 234,287 $ 306 $ (825 ) $ 233,768 As of December 31, 2019 Amortized Cost Unrealized Gains Unrealized Losses Fair value Cash and cash equivalents: Demand deposits and other cash $ 21,618 $ — $ — $ 21,618 Money market funds 4,086 — — 4,086 Commercial paper — — — — Total cash and cash equivalents 25,704 — — 25,704 Short-Term Investments: Commercial paper 12,861 — (7 ) 12,854 U.S. government agency securities 3,000 — — 3,000 U.S. Treasury securities — — — — Corporate debt securities 187,866 499 (55 ) 188,310 Total short-term investments 203,727 499 (62 ) 204,164 Total cash, cash equivalents and short-term investments $ 229,431 $ 499 $ (62 ) $ 229,868 |
Investments Classified by Contractual Maturity Date | Classification of the cash, cash equivalents and short-term investments by contractual maturity was as follows: (in thousands) One year or shorter Between 1 and 2 years Total Balances as of March 31, 2020 Cash and cash equivalents (1) $ 31,136 $ — $ 31,136 Short-term investments 130,834 71,798 202,632 Cash, cash equivalents and short-term investments $ 161,970 $ 71,798 $ 233,768 Balances as of December 31, 2019 Cash and cash equivalents (1) $ 25,704 $ — $ 25,704 Short-term investments 113,010 91,154 204,164 Cash, cash equivalents and short-term investments $ 138,714 $ 91,154 $ 229,868 (1) Includes demand deposits and other cash, money market funds and other cash equivalent securities, all with 0-90 day maturity at purchase. |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of the computation of basic and diluted net income (loss) per share | The following table sets forth the computation of basic and diluted net loss per share (in thousands, except per share amounts): Three months ended March 31, 2020 2019 Numerator: Net loss $ (10,470 ) $ (11,735 ) Denominator: Weighted average shares used to compute net loss per common share - basic 31,738 30,800 Weighted-average shares used to compute net loss per common share - diluted 31,738 30,800 Net loss per share Basic $ (0.33 ) $ (0.38 ) Diluted $ (0.33 ) $ (0.38 ) |
Schedule of antidilutive securities excluded from computation of earnings per share | The following securities were not included in the calculation of diluted shares outstanding as the effect would have been anti-dilutive: Three months ended March 31, (in thousands) 2020 2019 Options to purchase common stock, including ESPP 620 724 Restricted stock units 1,635 1,850 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | The estimated useful lives and carrying value of acquired intangible assets are as follows: March 31, 2020 December 31, 2019 (in thousands) Range of Useful Life (years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology 3 to 7 $ 10,050 $ 9,854 $ 196 $ 10,050 $ 9,803 $ 247 Customer relationships 7 to 9 10,920 6,088 4,832 10,920 5,819 5,101 Backlog 3 1,400 1,287 113 1,400 1,287 113 Non-compete agreements 2 to 4 460 460 — 460 460 — Trademarks 3 to 7 1,110 1,110 — 1,110 1,110 — Intangible assets, net book value $ 23,940 $ 18,799 $ 5,141 $ 23,940 $ 18,479 $ 5,461 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Amortization of acquired intangible assets is reflected in the cost of revenue for developed technology and backlog and in operating expenses for the other intangible assets. The estimated future amortization of existing acquired intangible assets as of March 31, 2020 was as follows: (in thousands) Future amortization 2020 (remaining nine months) $ 1,036 2021 1,130 2022 1,050 2023 1,050 2024 875 Future amortization expense $ 5,141 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Balance Sheet Components [Abstract] | |
Inventories | Inventories (in thousands) March 31, December 31, Raw materials $ 962 $ 831 Finished goods 5,065 3,745 Total inventories $ 6,027 $ 4,576 |
Property and Equipment | Property and equipment, net (in thousands) March 31, December 31, Computer equipment and software $ 14,088 $ 13,596 Furniture, fixtures and equipment 2,554 2,430 Leasehold improvements 5,351 5,283 Manufacturing tools and equipment 2,476 2,435 Construction in process 131 582 Property and equipment, at cost 24,600 24,326 Less: Accumulated depreciation (16,349 ) (15,665 ) Property and equipment, net $ 8,251 $ 8,661 Depreciation and amortization expense for property and equipment was $1.0 million and $0.9 million for the three months ended March 31, 2020 and 2019 , respectively. |
Schedule of Components of Leveraged Lease Investments | Net investment in sales-type leases The Company has sales-type leases with terms of 3 to 4 years. Sales-type lease receivables are collateralized by the underlying equipment. The components of the Company’s net investment in sales-type leases are as follows: (in thousands) March 31, December 31, Minimum payments to be received on sales-type leases $ 1,796 $ 2,078 Less: Unearned interest income and executory revenue portion (1,097 ) (1,190 ) Net investment in sales-type leases 699 888 Less: Current portion (346 ) (452 ) Non-current net investment in sales-type leases $ 353 $ 436 Sales-type lease activity recognized in the condensed consolidated statement of operations are as follows: Three months ended March 31, (in thousands) 2020 2019 Lease revenue $ 435 $ 661 Less: Cost of lease shipments (10 ) (52 ) Gross profit 425 609 Interest income (expense), net on lease receivable $ (6 ) $ (3 ) Initial direct cost incurred $ 23 $ 31 There were no allowances for doubtful accounts on these leases as of March 31, 2020 and December 31, 2019 . There is no guaranteed or unguaranteed residual value on the leased equipment. The current and non-current net investments in sales-type leases are reported as components of the condensed consolidated balance sheet captions “other receivables” and “other long-term assets,” respectively. |
Schedule of Future Minimum Lease Payments for Capital Leases | The minimum payments expected to be received for future years under sales-type leases as of March 31, 2020 were as follows: (in thousands) Future lease payments 2020 (remaining nine months) $ 716 2021 615 2022 387 2023 78 Total $ 1,796 |
Accrued Liabilities | Accrued payroll and other current liabilities (in thousands) March 31, December 31, Payroll and related expenses $ 7,276 $ 6,053 Accrued payables 1,707 2,674 Operating lease liabilities, current portion 2,336 2,323 Lease financing, current portion 898 1,033 Product warranty 440 420 Customer prepayments 665 631 Sales and use tax payable 469 599 Other 1,520 1,024 Total accrued payroll and other current liabilities $ 15,311 $ 14,757 |
Schedule of Product Warranty Liability | The changes in the Company’s product warranty reserve are as follows: Three months ended March 31, (in thousands) 2020 2019 Warranty balance at the beginning of the period $ 420 $ 376 Warranty expense accrued for shipments during the period 108 77 Changes in estimate related to pre-existing warranties (31 ) (31 ) Warranty settlements made (57 ) (48 ) Total product warranty $ 440 $ 374 |
Information Related to Leases | Supplemental balance sheet information related to leases was as follows: (in thousands) March 31, Other long-term assets $ 5,590 Accrued payroll and other current liabilities 2,336 Other long-term liabilities 4,116 Total operating lease liabilities $ 6,452 Other information related to leases was as follows: Three months ended March 31, Three months ended March 31, (in thousands) 2020 2019 Supplemental Cash Flow Information Cash paid for amounts included in the measurement of lease liabilities $ 712 $ 630 Right-of-use assets obtained in exchange for lease obligations $ — $ 689 Weighted average remaining lease term 2.39 years 3.11 years Weighted average discount rate 8 % 8 % |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Notes | The Notes consist of the following: (in thousands) March 31, December 31, Liability: Principal $ 143,750 $ 143,750 Unamortized debt discount (22,321 ) (23,880 ) Unamortized issuance costs (2,516 ) (2,692 ) Net carrying amount $ 118,913 $ 117,178 Stockholders’ equity: Debt discount for conversion option $ 33,350 $ 33,350 Issuance costs $ (1,136 ) $ (1,136 ) Net carrying amount $ 32,214 $ 32,214 |
Schedule of Interest Expense Related to the Notes | Interest expense related to the Notes is as follows: Three months ended March 31, (in thousands) 2020 2019 Contractual interest expense $ 539 $ 539 Amortization of debt discount 1,559 1,422 Amortization of issuance costs 176 160 Total interest expense $ 2,274 $ 2,121 |
Schedule of Net Impact on Stockholders' Equity of Components of Convertible Debt | The net impact to the Company’s stockholders' equity, included in additional paid-in capital, of the above components of the Notes is as follows: (in thousands) March 31, Conversion option $ 33,350 Purchase of capped calls $ (8,907 ) Issuance costs $ (1,136 ) Total $ 23,307 |
Stock-based Compensation and _2
Stock-based Compensation and Awards (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Rollforward of stock option activity | A summary of the stock option activity for the three months ended March 31, 2020 is presented below: Options Outstanding Number of options Weighted average exercise price Weighted average remaining contractual term Aggregate intrinsic value (in years) (in thousands) Outstanding at December 31, 2019 606,327 $ 13.41 3.62 $ 4,566 Options granted — — Options exercised (77,909 ) 9.38 Options canceled — — Outstanding at March 31, 2020 528,418 $ 14.01 3.38 $ 3,974 |
Equity B-S-M Valuation Assumptions | The following Black-Scholes option-pricing assumptions were used for each respective period for the ESPP: Three months ended March 31, 2020 2019 Expected term (in years) 0.50 0.50 Volatility 50.0% 33.0% Risk-free interest rate 1.59% 2.51% Dividend yield 0% 0% |
Rollforward of RSA and RSU activty | A summary of RSU activity for the three months ended March 31, 2020 is presented below: Restricted Stock Units Number of shares Weighted Average Grant Date Fair Value per Share Outstanding at December 31, 2019 1,550,646 $ 28.94 Granted 203,971 22.84 Vested (101,431 ) 31.08 Forfeited (17,868 ) 28.11 Outstanding at March 31, 2020 1,635,318 $ 28.06 |
Allocation of Recognized Period Costs | The following table presents the allocation of stock-based compensation expense: Three months ended March 31, (in thousands) 2020 2019 Cost of revenue $ 973 $ 978 Research and development 966 822 Sales and marketing 1,860 1,720 General and administrative 2,042 2,024 Total stock-based compensation $ 5,841 $ 5,544 |
Segments Segments (Tables)
Segments Segments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segments | The following table presents a summary of the operating segments: Three months ended March 31, 2020 2019 (in thousands) Revenue Product $ 17,850 $ 14,003 Service 22,823 21,306 Total revenue 40,673 35,309 Cost of revenue Product 6,364 5,334 Service 10,523 10,290 Total cost of revenue 16,887 15,624 Gross profit Product 11,486 8,669 Service 12,300 11,016 Total gross profit 23,786 19,685 Operating expenses 32,386 30,745 Interest expense, net and other (1,745 ) (711 ) Loss before income taxes $ (10,345 ) $ (11,771 ) |
The Company and Summary of Si_3
The Company and Summary of Significant Accounting Policies Narrative (Details) $ in Thousands | Mar. 31, 2020USD ($) |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Other long-term assets | $ 5,590 |
Total operating lease liabilities | $ 6,452 |
Revenue, deferred revenue, an_3
Revenue, deferred revenue, and deferred commissions - Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Other receivables | $ 6,374 | $ 6,312 |
Deferred revenue, current | 45,987 | 50,033 |
Deferred revenue, long-term | 10,689 | 11,442 |
Total deferred revenue | 56,676 | 61,475 |
Stockholders' equity | $ 158,107 | $ 163,825 |
Revenue, deferred revenue, an_4
Revenue, deferred revenue, and deferred commissions - Consolidated Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue | ||
Total revenue | $ 40,673 | $ 35,309 |
Gross Profit | 23,786 | 19,685 |
Operating expenses | 32,386 | 30,745 |
Operating Income (Loss) | (8,600) | (11,060) |
Net loss | (10,470) | (11,735) |
Product | ||
Revenue | ||
Total revenue | 17,850 | 14,003 |
Service | ||
Revenue | ||
Total revenue | $ 22,823 | $ 21,306 |
Revenue, deferred revenue, an_5
Revenue, deferred revenue, and deferred commissions - Cash Flows From Operating Activities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Net loss | $ (10,470) | $ (11,735) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Deferred commissions | 171 | (19) |
Deferred revenue | $ (4,799) | $ (5,687) |
Revenue, deferred revenue, an_6
Revenue, deferred revenue, and deferred commissions - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Total revenue | $ 40,673 | $ 35,309 |
Product Segment [Member] | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Total revenue | 17,850 | 14,003 |
Product Segment [Member] | Software [Member] | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Total revenue | 3,947 | 3,943 |
Product Segment [Member] | Device [Member] | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Total revenue | 13,903 | 10,060 |
Service Segment [Member] | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Total revenue | 22,823 | 21,306 |
Service Segment [Member] | Maintenance and Support [Member] | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Total revenue | 18,069 | 16,393 |
Service Segment [Member] | Professional Services and Training [Member] | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Total revenue | $ 4,754 | $ 4,913 |
Revenue, deferred revenue, an_7
Revenue, deferred revenue, and deferred commissions - Significant Changes in Deferred Commissions (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Change in Contract with Customer, Asset [Roll Forward] | |
Beginning balance | $ 10,477 |
Additions | 2,489 |
Commissions Recognized | (2,659) |
Ending balance | $ 10,307 |
Revenue, deferred revenue, an_8
Revenue, deferred revenue, and deferred commissions - Significant Changes in Deferred Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | ||
Revenue recognized pertaining to amounts deferred as of Beginning of Period | $ 18,500 | |
Revenue recognized pertaining to amounts deferred as of End of Period | $ 15,200 | |
Change in Contract with Customer, Liability [Roll Forward] | ||
Beginning balance | 61,475 | |
Additions | 14,945 | |
Revenue Recognized | (19,744) | |
Ending balance | $ 56,676 |
Revenue, deferred revenue, an_9
Revenue, deferred revenue, and deferred commissions - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |||
Payment terms on invoiced amounts | 30 days | ||
Deferred commissions | $ 10,307 | $ 10,477 | |
Percentage of deferred commissions to be recognized as commission expense in the next 12 months | 48.00% | ||
Revenue recognized pertaining to amounts deferred as of Beginning of Period | $ 18,500 | ||
Revenue recognized pertaining to amounts deferred as of End of Period | $ 15,200 | ||
Deferred revenue and backlog | $ 112,500 | ||
Percentage of deferred revenue to be recognized over the next 12 months | 66.00% | ||
Contract with Customer, Asset, before Allowance for Credit Loss | $ 4,500 | $ 4,300 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value, Assets, Level 2 to Level 1 Transfers, Amount | $ 0 | |
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount | 0 | |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3 | 0 | |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers out of Level 3 | 0 | |
Assets, Fair Value Disclosure [Abstract] | ||
Cash and cash equivalents | 31,136,000 | $ 25,704,000 |
Short-term investments | 202,632,000 | 204,164,000 |
U.S. government agency securities | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | 3,000,000 | |
U.S. Treasury securities | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | 0 | |
Corporate debt securities | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | 186,725,000 | 188,310,000 |
Fair Value, Measurements, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Total assets measured at fair value | 208,479,000 | 208,250,000 |
Fair Value, Measurements, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Total assets measured at fair value | 3,855,000 | 4,086,000 |
Fair Value, Measurements, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Total assets measured at fair value | 204,624,000 | 204,164,000 |
Fair Value, Measurements, Recurring | U.S. government agency securities | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | 0 | 3,000,000 |
Fair Value, Measurements, Recurring | U.S. government agency securities | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | 0 | 0 |
Fair Value, Measurements, Recurring | U.S. government agency securities | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | 0 | 3,000,000 |
Fair Value, Measurements, Recurring | Corporate debt securities | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | 186,725,000 | 188,310,000 |
Fair Value, Measurements, Recurring | Corporate debt securities | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | 0 | 0 |
Fair Value, Measurements, Recurring | Corporate debt securities | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | 186,725,000 | 188,310,000 |
Fair Value, Measurements, Recurring | Money market funds | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash and cash equivalents | 3,855,000 | 4,086,000 |
Fair Value, Measurements, Recurring | Money market funds | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash and cash equivalents | 3,855,000 | 4,086,000 |
Fair Value, Measurements, Recurring | Money market funds | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash and cash equivalents | 0 | 0 |
Fair Value, Measurements, Recurring | Commercial paper | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | 17,899,000 | 12,854,000 |
Fair Value, Measurements, Recurring | Commercial paper | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | 0 | 0 |
Fair Value, Measurements, Recurring | Commercial paper | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Short-term investments | $ 17,899,000 | $ 12,854,000 |
Schedule of Available for Sale
Schedule of Available for Sale Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Cash and cash equivalents [Abstract] | ||
Cash and Cash Equivalents, Amortized Cost | $ 31,138 | $ 25,704 |
Cash And Cash Equivalents, Gross Unrealized Gains | 0 | 0 |
Cash And Cash Equivalents, Gross Unrealized Losses | (2) | 0 |
Cash and cash equivalents | 31,136 | 25,704 |
Short-term Investments [Abstract] | ||
AFS Securities, Amortized Cost Basis | 203,149 | 203,727 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 306 | 499 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 823 | 62 |
Short-term investments | 202,632 | 204,164 |
Cash, Cash Equivalents, and Short-term Investments [Abstract] | ||
Cash, Cash Equiv. And S-T Investments, Amortized Cost | 234,287 | 229,431 |
Cash, Cash Equivalents And Short Term Investments, Unrealized Gains | 306 | 499 |
Cash, Cash Equivalents And Short Term Investments, Unrealized Losses | 825 | 62 |
Cash, cash equivalents and short-term investments | 233,768 | 229,868 |
Demand deposits and other cash | ||
Cash and cash equivalents [Abstract] | ||
Cash and Cash Equivalents, Amortized Cost | 25,289 | 21,618 |
Cash And Cash Equivalents, Gross Unrealized Gains | 0 | 0 |
Cash And Cash Equivalents, Gross Unrealized Losses | 0 | 0 |
Cash and cash equivalents | 25,289 | 21,618 |
Money market funds | ||
Cash and cash equivalents [Abstract] | ||
Cash and Cash Equivalents, Amortized Cost | 3,855 | 4,086 |
Cash And Cash Equivalents, Gross Unrealized Gains | 0 | 0 |
Cash And Cash Equivalents, Gross Unrealized Losses | 0 | 0 |
Cash and cash equivalents | 3,855 | 4,086 |
Commercial Paper in CE | ||
Cash and cash equivalents [Abstract] | ||
Cash and Cash Equivalents, Amortized Cost | 1,994 | 0 |
Cash And Cash Equivalents, Gross Unrealized Gains | 0 | 0 |
Cash And Cash Equivalents, Gross Unrealized Losses | (2) | 0 |
Cash and cash equivalents | 1,992 | 0 |
Commercial paper in STI | ||
Short-term Investments [Abstract] | ||
AFS Securities, Amortized Cost Basis | 15,911 | 12,861 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 10 | 0 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 14 | 7 |
Short-term investments | 15,907 | 12,854 |
U.S. government agency securities | ||
Short-term Investments [Abstract] | ||
AFS Securities, Amortized Cost Basis | 3,000 | |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 0 | |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 0 | |
Short-term investments | 3,000 | |
U.S. Treasury securities | ||
Short-term Investments [Abstract] | ||
AFS Securities, Amortized Cost Basis | 0 | |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 0 | |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 0 | |
Short-term investments | 0 | |
Corporate Debt Securities | ||
Short-term Investments [Abstract] | ||
AFS Securities, Amortized Cost Basis | 187,238 | 187,866 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 296 | 499 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 809 | 55 |
Short-term investments | $ 186,725 | $ 188,310 |
Contractual maturities of cash,
Contractual maturities of cash, cash equivalent and short-term investment (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Securities, Available-for-sale [Line Items] | ||
Cash and cash equivalents | $ 31,136 | $ 25,704 |
Short-term investments | 202,632 | 204,164 |
Cash, cash equivalents and short-term investments | 233,768 | 229,868 |
Maturity up to one year | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash and cash equivalents | 31,136 | 25,704 |
Short-term investments | 130,834 | 113,010 |
Cash, cash equivalents and short-term investments | 161,970 | 138,714 |
maturity between 1 and 2 years [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Short-term investments | 71,798 | 91,154 |
Cash, cash equivalents and short-term investments | $ 71,798 | $ 91,154 |
Schedule of the computation of
Schedule of the computation of basic and diluted net income (loss) per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Weighted Average Number of Shares Outstanding, Diluted | 31,738 | 30,800 |
Weighted Average Number of Shares Outstanding, Basic | 31,738 | 30,800 |
Numerator: | ||
Net loss | $ (10,470) | $ (11,735) |
Denominator: | ||
Weighted Average Number of Shares Outstanding, Basic and Diluted | 30,800 | |
Net loss per share | ||
Earnings Per Share, Basic | $ (0.33) | $ (0.38) |
Earnings Per Share, Diluted | $ (0.33) | $ (0.38) |
Schedule of antidilutive securi
Schedule of antidilutive securities excluded from computation of earnings per share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Options to purchase common stock, including ESPP | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 620 | 724 |
Restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,635 | 1,850 |
Schedule of Finite-Lived Intang
Schedule of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Expected Amortization, Year Two | $ 1,130 | |
Finite-Lived Intangible Asset, Expected Amortization, Year Three | 1,050 | |
Finite-Lived Intangible Asset, Expected Amortization, Year Four | 1,050 | |
Finite-Lived Intangibles, Amortization Expense, Year Five | 875 | |
Accumulated Amortization | 18,799 | $ 18,479 |
Finite-Lived Intangible Assets, Net | 5,141 | |
Finite-Lived Intangible Assets, Useful Life | ||
Intangible assets, gross | 23,940 | 23,940 |
Intangible assets, net book value | 5,141 | 5,461 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 10,050 | 10,050 |
Accumulated Amortization | 9,854 | 9,803 |
Finite-Lived Intangible Assets, Net | 196 | 247 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 10,920 | 10,920 |
Accumulated Amortization | 6,088 | 5,819 |
Finite-Lived Intangible Assets, Net | 4,832 | 5,101 |
Order or Production Backlog [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,400 | 1,400 |
Accumulated Amortization | 1,287 | 1,287 |
Finite-Lived Intangible Assets, Net | 113 | 113 |
Noncompete Agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 460 | 460 |
Accumulated Amortization | 460 | 460 |
Finite-Lived Intangible Assets, Net | 0 | 0 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,110 | 1,110 |
Accumulated Amortization | 1,110 | 1,110 |
Finite-Lived Intangible Assets, Net | $ 0 | $ 0 |
Minimum | Developed technology | ||
Finite-Lived Intangible Assets, Useful Life | ||
Finite-lived intangible asset, useful life | 3 years | |
Minimum | Customer relationships | ||
Finite-Lived Intangible Assets, Useful Life | ||
Finite-lived intangible asset, useful life | 7 years | |
Minimum | Order or Production Backlog [Member] | ||
Finite-Lived Intangible Assets, Useful Life | ||
Finite-lived intangible asset, useful life | 3 years | |
Minimum | Noncompete Agreements | ||
Finite-Lived Intangible Assets, Useful Life | ||
Finite-lived intangible asset, useful life | 2 years | |
Minimum | Trademarks | ||
Finite-Lived Intangible Assets, Useful Life | ||
Finite-lived intangible asset, useful life | 3 years | |
Maximum | Developed technology | ||
Finite-Lived Intangible Assets, Useful Life | ||
Finite-lived intangible asset, useful life | 7 years | |
Maximum | Customer relationships | ||
Finite-Lived Intangible Assets, Useful Life | ||
Finite-lived intangible asset, useful life | 9 years | |
Maximum | Order or Production Backlog [Member] | ||
Finite-Lived Intangible Assets, Useful Life | ||
Finite-lived intangible asset, useful life | 3 years | |
Maximum | Noncompete Agreements | ||
Finite-Lived Intangible Assets, Useful Life | ||
Finite-lived intangible asset, useful life | 4 years | |
Maximum | Trademarks | ||
Finite-Lived Intangible Assets, Useful Life | ||
Finite-lived intangible asset, useful life | 7 years |
Future amortization schedule (D
Future amortization schedule (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Goodwill and intangible assets [Abstract] | |
Finite-Lived Intangible Asset, Expected Amortization, Year One | $ 1,036 |
Finite-Lived Intangible Asset, Expected Amortization, Year Two | 1,130 |
Finite-Lived Intangible Asset, Expected Amortization, Year Three | 1,050 |
Finite-Lived Intangible Asset, Expected Amortization, Year Four | 1,050 |
Finite-Lived Intangibles, Amortization Expense, Year Five | 875 |
Finite-Lived Intangible Assets, Net | $ 5,141 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | $ 49,246 | $ 49,246 | |
Intangibles - period amortization expense [Abstract] | |||
Amortization expense | 300 | $ 1,000 | |
Product Segment [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | 41,200 | ||
Service Segment [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | $ 8,000 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Inventory, Net [Abstract] | ||
Raw materials | $ 962 | $ 831 |
Finished goods | 5,065 | 3,745 |
Total inventories | $ 6,027 | $ 4,576 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | $ 24,600 | $ 24,326 | |
Less: Accumulated depreciation | (16,349) | (15,665) | |
Property and equipment, net | 8,251 | 8,661 | |
Depreciation, Depletion and Amortization [Abstract] | |||
Depreciation | 1,000 | $ 900 | |
Computer equipment and software | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 14,088 | 13,596 | |
Furniture, fixtures and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 2,554 | 2,430 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 5,351 | 5,283 | |
Manufacturing tools and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 2,476 | 2,435 | |
Construction in process | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | $ 131 | $ 582 |
Investment in Sales Type Leases
Investment in Sales Type Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Capital Leased Assets [Line Items] | ||
Sales-type and Direct Financing Leases, Lease Receivable, Payments to be Received | $ 1,796 | $ 2,078 |
Sales-type and Direct Financing Leases, Lease Receivable, Undiscounted Excess Amount | 1,097 | 1,190 |
Net Investment in Lease | 699 | 888 |
Net Investment in Lease, Current | 346 | 452 |
Net Investment in Lease, Noncurrent | $ 353 | $ 436 |
Minimum | ||
Capital Leased Assets [Line Items] | ||
Lessors, Capital Leases, Term of contract | 3 years | |
Maximum | ||
Capital Leased Assets [Line Items] | ||
Lessors, Capital Leases, Term of contract | 4 years |
Balance Sheet Components Sales
Balance Sheet Components Sales Type Lease Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Balance Sheet Components [Abstract] | ||
Lease revenue | $ 435 | $ 661 |
Less: Cost of lease shipments | (10) | (52) |
Gross profit | 425 | 609 |
Sales-type Lease, Interest Income, Lease Receivable | (6) | (3) |
Initial direct cost incurred | $ 23 | $ 31 |
Future payments- sales type lea
Future payments- sales type leases (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Balance Sheet Components [Abstract] | |
Sales-Type and Direct Financing Leases, Lease Receivable, to be Received, Year One | $ 716 |
Sales-Type and Direct Financing Leases, Lease Receivable, to be Received, Year Four | 78 |
Sales-Type and Direct Financing Leases, Lease Receivable, to be Received, Year Two | 615 |
Sales-Type and Direct Financing Leases, Lease Receivable, to be Received, Year Three | $ 387 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Accrued Liabilities, Current [Abstract] | ||
Payroll and related expenses | $ 7,276 | $ 6,053 |
Accrued payables | 1,707 | 2,674 |
Deferred Rent Credit, Current | 2,336 | 2,323 |
Lease financing, current portion | 898 | 1,033 |
Product warranty | 440 | 420 |
Customer Refund Liability, Current | 665 | 631 |
Sales and use tax payable | 469 | 599 |
Other | 1,520 | 1,024 |
Total accrued payroll and other current liabilities | $ 15,311 | $ 14,757 |
Schedule of Product Liability (
Schedule of Product Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward] | ||
Product warranty accrual, at the beginning of the period | $ 420 | $ 376 |
Warranty expenses accrued | 108 | 77 |
Product Warranty Accrual, Preexisting, Increase (Decrease) | (31) | (31) |
Warranty settlements made | (57) | (48) |
Product Warranty Accrual | $ 440 | $ 374 |
Balance Sheet Components Leases
Balance Sheet Components Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Operating lease cost | $ 700 | $ 600 |
Operating leas asset | $ 5,590 |
Balance Sheet Components Supple
Balance Sheet Components Supplemental Balance Sheet Information Related to Leases (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Balance Sheet Components [Abstract] | ||
Other long-term assets | $ 5,590 | |
Deferred Rent Credit, Current | 2,336 | $ 2,323 |
Other long-term liabilities | 4,116 | |
Total operating lease liabilities | $ 6,452 |
Balance Sheet Components Other
Balance Sheet Components Other Information Related to Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Balance Sheet Components [Abstract] | ||
Cash paid for amounts included in the measurement of lease liabilities | $ 712 | $ 630 |
Right-of-use assets obtained in exchange for lease obligations | $ 0 | $ 689 |
Weighted average remaining lease term | 2 years 4 months 20 days | 3 years 1 month 9 days |
Weighted average discount rate | 8.00% | 8.00% |
Balance Sheet Components Maturi
Balance Sheet Components Maturities of Leases (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Balance Sheet Components [Abstract] | |
2020 (remaining nine months) | $ 2,191 |
2020 | 2,960 |
2021 | 1,326 |
2022 | 403 |
2023 | 319 |
Total maturities of lease liabilities | 7,199 |
Less imputed interest | (747) |
Total | $ 6,452 |
Convertible Senior Notes - Conv
Convertible Senior Notes - Convertible Notes and Options (Details) | 1 Months Ended | 2 Months Ended | 3 Months Ended | ||
May 31, 2018USD ($)day$ / shares | Jun. 30, 2018USD ($) | Mar. 31, 2020USD ($)$ / shares | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($) | |
Debt Instrument [Line Items] | |||||
Net carrying amount | $ 118,913,000 | $ 117,178,000 | |||
Total interest expense | 2,274,000 | $ 2,121,000 | |||
Convertible Debt | Convertible Senior Notes at 1.50% | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 143,750,000 | 143,750,000 | 143,750,000 | ||
Stated interest rate | 1.50% | ||||
Proceeds from issuance of convertible senior notes, net of issuance costs | $ 138,900,000 | ||||
Unamortized debt discount | (22,321,000) | (23,880,000) | |||
Unamortized issuance costs | (2,516,000) | (2,692,000) | |||
Net carrying amount | 118,913,000 | 117,178,000 | |||
Convertible Debt | Convertible Senior Notes At 1.50%, Option Portion | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 18,750,000 | ||||
Stated interest rate | 1.50% | ||||
Conversion ratio | 0.0310073 | ||||
Convertible debt, conversion price (in dollars per share) | $ / shares | $ 32.25 | ||||
Denominator in calculation of trading price | $ 1,000 | ||||
Conditional cash repurchase, percent of principal | 100.00% | ||||
Carrying amount of the equity component | $ 33,400,000 | 33,350,000 | 33,350,000 | ||
Debt discount effective interest rate | 7.60% | ||||
Amortization of debt issuance costs | $ 4,900,000 | 176,000 | 160,000 | ||
Amortization of debt issuance costs, liability component | 3,800,000 | ||||
Amortization of debt issuance costs, equity component | $ 1,100,000 | ||||
Issuance costs | (1,136,000) | (1,136,000) | |||
Net carrying amount | 32,214,000 | $ 32,214,000 | |||
Estimated fair value of the Notes | 142,700,000 | ||||
Denominator in closing price calculation | $ 100 | ||||
If-converted value, share price (in dollars per share) | $ / shares | $ 21.24 | ||||
If-converted value of the Notes | $ 94,700,000 | ||||
Contractual interest expense | 539,000 | 539,000 | |||
Amortization of debt discount | 1,559,000 | 1,422,000 | |||
Total interest expense | $ 2,274,000 | $ 2,121,000 | |||
Convertible Debt | Convertible Senior Notes At 1.50%, Option Portion | Maximum | |||||
Debt Instrument [Line Items] | |||||
Convertible debt, threshold trading days | day | 20 | ||||
Convertible debt, threshold consecutive trading days | day | 30 | ||||
Percent of conversion price triggering conversion feature | 130.00% | ||||
Convertible Debt | Convertible Senior Notes At 1.50%, Option Portion | Minimum | |||||
Debt Instrument [Line Items] | |||||
Convertible debt, threshold trading days | day | 5 | ||||
Convertible debt, threshold consecutive trading days | day | 10 | ||||
Percent of conversion price triggering conversion feature | 98.00% |
Convertible Senior Notes - Capp
Convertible Senior Notes - Capped Calls (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 1 Months Ended | 3 Months Ended | |
May 31, 2018 | Mar. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | |||
Capped Calls, initial strike price (in dollars per share) | $ 32.25 | ||
Capped Calls, initial cap price (in dollars per share) | $ 38.94 | ||
Capped Calls, number of shares covered | 4.5 | ||
Payment for purchase of capped calls | $ (8,900) | $ (8,907) | |
Issuance costs | (1,136) | ||
Convertible Debt | Convertible Senior Notes At 1.50%, Option Portion | |||
Debt Instrument [Line Items] | |||
Carrying amount of the equity component | $ 33,400 | 33,350 | $ 33,350 |
Carrying amount of equity component, net of capped calls | $ 23,307 |
Commitments Narrative (Details)
Commitments Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Inventories | ||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||
Unrecorded Unconditional Purchase Obligation | $ 7.6 | $ 9.7 |
Stock Option Activity (Details)
Stock Option Activity (Details) - Stock Options - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Number of Options (in shares): | |||
Beginning balance | 606,327 | ||
Options granted | 0 | ||
Options exercised | (77,909) | ||
Options canceled | 0 | ||
Ending balance | 528,418 | ||
Weighted Average Exercise Price (in dollars per share): | |||
Beginning balance | $ 13.41 | ||
Options granted | 0 | ||
Options exercised | 9.38 | ||
Options canceled | 0 | ||
Ending balance | $ 14.01 | ||
Wtd avg remaining term, Outstanding | 3 years 4 months 17 days | 3 years 7 months 13 days | |
Aggregate intrinsic value, Outstanding | $ 3,974 | $ 4,566 |
Summary of Equity B-S-M Assumpt
Summary of Equity B-S-M Assumptiuons (Details) - 2012 Employee Stock Purchase Plan - ESPP | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Equity B-S-M Fair Value Assumptions | ||
Expected Term (in years) | 6 months | 6 months |
Volatility | 50.00% | 33.00% |
Interest Rate | 1.59% | 2.51% |
Dividend yield | 0.00% | 0.00% |
Minimum | ||
Equity B-S-M Fair Value Assumptions | ||
Volatility | 50.00% | 33.00% |
Interest Rate | 1.59% | 2.51% |
Maximum | ||
Equity B-S-M Fair Value Assumptions | ||
Volatility | 50.00% | 33.00% |
Interest Rate | 1.59% | 2.51% |
Summary of Restricted Stock Act
Summary of Restricted Stock Activity (Details) - Restricted Stock Units | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock Comp-other than options - Period for Recognition- Comp cost not yet rocognized | 1 year 9 months |
Number of Shares: | |
Beginning balance | shares | 1,550,646 |
Granted | shares | 203,971 |
Vested | shares | (101,431) |
Forfeited | shares | (17,868) |
Ending balance | shares | 1,635,318 |
Weighted Average Grant Date Fair Value per Share (in dollars per share): | |
Beginning balance | $ / shares | $ 28.94 |
Granted | $ / shares | 22.84 |
Vested | $ / shares | 31.08 |
Forfeited | $ / shares | 28.11 |
Ending balance | $ / shares | $ 28.06 |
Share-based Compensaton Allocat
Share-based Compensaton Allocated to Expense Captions (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 5,841 | |
Cost of Sales | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 973 | $ 978 |
Research and Development Expense | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 966 | 822 |
Selling and Marketing Expense | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 1,860 | 1,720 |
General and Administrative Expense | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 2,042 | $ 2,024 |
Narrative (Details)
Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($)shares | |
Restricted stock units | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | |
Share-based Payment Arrangement, Nonvested Award, Excluding Option, Cost Not yet Recognized, Amount | $ | $ 28.8 |
Stock Comp-other than options - Period for Recognition- Comp cost not yet rocognized | 1 year 9 months |
2012 Stock Option Plan | Stock options and restricted stock units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares Available for Grant | 1,855,146 |
2012 Employee Stock Purchase Plan | ESPP | |
ESPP plan details [Abstract] | |
Common Stock, Capital Shares Reserved for Future Issuance | 1,189,618 |
Segments Operating Segments (De
Segments Operating Segments (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020USD ($)Segments | Mar. 31, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | Segments | 2 | |
Revenue | ||
Total revenue | $ 40,673 | $ 35,309 |
Cost of revenue | ||
Total cost of revenue | 16,887 | 15,624 |
Gross profit | ||
Product | 11,486 | 8,669 |
Service | 12,300 | 11,016 |
Total gross profit | 23,786 | 19,685 |
Calculation of pretax profit (loss) [Abstract] | ||
Operating expenses | 32,386 | 30,745 |
Interest expense, net and other | (1,745) | (711) |
Loss before income taxes | (10,345) | (11,771) |
Product | ||
Revenue | ||
Total revenue | 17,850 | 14,003 |
Cost of revenue | ||
Total cost of revenue | 6,364 | 5,334 |
Service | ||
Revenue | ||
Total revenue | 22,823 | 21,306 |
Cost of revenue | ||
Total cost of revenue | $ 10,523 | $ 10,290 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense (benefit) | $ (125,000) | $ 36,000 |