Vocera Communications (VCRA) 10-Q 5 Nov 20 2020 Q3 Quarterly report Financial data

Cover Page

Cover Page - shares	9 Months Ended
	Sep. 30, 2020	Nov. 03, 2020
Entity Listings [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 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		32,493,391
Entity Central Index Key	0001129260
Amendment Flag	false
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
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	9 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Sales of short-term investments	$ 29,381
Current assets
Cash and cash equivalents	31,242	$ 25,704
Short-term investments	179,995	204,164
Accounts receivable, net of allowance	39,210	42,547
Other receivables	6,263	6,312
Inventories	10,451	4,576
Prepaid expenses and other current assets	6,141	5,149
Total current assets	273,302	288,452
Property and equipment, net	8,070	8,661
Intangible assets, net	13,546	5,461
Goodwill	69,168	49,246
Deferred commissions	11,325	10,477
Other long-term assets	6,834	8,158
Total assets	382,245	370,455
Current liabilities
Accounts payable	4,832	6,036
Accrued payroll and other current liabilities	17,212	14,757
Deferred revenue, current	47,884	50,033
Total current liabilities	69,928	70,826
Deferred revenue, long-term	9,524	11,442
Convertible senior notes, net	122,511	117,178
Other long-term liabilities	2,922
Other long-term liabilities	8,580	7,184
Total liabilities	210,543	206,630
Commitments and contingencies (Note 9)
Stockholders' equity
Preferred stock, $0.0003 par value - 5,000,000 shares authorized as of September 30, 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 September 30, 2020 and December 31, 2019; 32,431,207 and 31,660,709 shares issued and outstanding as of September 30, 2020 and December 31, 2019, respectively	10	9
Additional paid-in capital	330,954	313,963
Accumulated other comprehensive income	841	179
Accumulated deficit	(160,103)	(150,326)
Total stockholders’ equity	171,702	163,825
Total liabilities and stockholders’ equity	$ 382,245	$ 370,455
Common stock par value	$ 0.0003	$ 0.0003

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets Condensed Consolidated Balance Sheets (Paranthetical) - $ / shares	Sep. 30, 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	32,347,972	31,660,709
Common stock shares outstanding	32,347,972	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 ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Revenue
Total revenue	$ 53,815	$ 50,781	$ 141,835	$ 130,849
Cost of revenue
Total cost of revenue	17,485	18,893	51,776	52,260
Gross profit	36,330	31,888	90,059	78,589
Operating expenses
Research and development	9,559	8,363	27,940	25,452
Sales and marketing	15,291	15,506	48,252	47,003
General and administrative	7,464	6,420	20,778	19,535
Total operating expenses	32,314	30,289	96,970	91,990
Income (Loss) from operations	4,016	1,599	(6,911)	(13,401)
Interest income	645	1,299	2,678	3,910
Interest expense	(2,368)	(2,233)	(6,950)	(6,524)
Other income (expense), net	264	(145)	(117)	(173)
Income (loss) before income taxes	2,557	520	(11,300)	(16,188)
Benefit from (provision for) income taxes	1,604	(222)	1,523	(106)
Net income (loss)	4,161	298	(9,777)	(16,294)
Product
Revenue
Total revenue	28,510	28,511	70,311	65,646
Cost of revenue
Total cost of revenue	7,139	8,204	21,213	20,450
Service
Revenue
Total revenue	25,305	22,270	71,524	65,203
Cost of revenue
Total cost of revenue	$ 10,346	$ 10,689	$ 30,563	$ 31,810

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Statement of Comprehensive Income [Abstract]
Net loss	$ 4,161	$ 298	$ (9,777)	$ (16,294)
Other comprehensive loss, net:
Change in unrealized gain on investments, net of tax	(188)	37	662	756
Comprehensive income (loss)	$ 3,973	$ 335	$ (9,115)	$ (15,538)

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Cash flows from operating activities
Net loss	$ (9,777)	$ (16,294)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	4,470	5,708
Change in lease-related performance liabilities	(957)	(851)
Stock-based compensation expense	18,886	17,822
Amortization of debt discount and issuance costs	5,333	4,912
Deferred income taxes	(2,056)	0
Non-cash lease expense	1,676	1,237
Other	608	(681)
Changes in operating assets and liabilities:
Accounts receivable	3,782	3,361
Other receivables	(119)	(2,187)
Inventories	(5,673)	(51)
Prepaid expenses and other assets	(1,186)	(1,295)
Deferred commissions	(847)	336
Accounts payable	(1,067)	(1,206)
Increase (Decrease) in Other Accrued Liabilities	1,632	(2,090)
Deferred revenue	(5,227)	(2,453)
Net cash used in operating activities	9,478	6,268
Cash flows from investing activities
Purchase of property and equipment	(2,890)	(2,807)
Business acquisitions, net of cash acquired	(24,218)	0
Purchase of short-term investments	(89,429)	(43,384)
Maturities of short-term investments	84,255	101,241
Sales of short-term investments	29,381	0
Net cash used in investing activities	(2,901)	55,050
Cash flows from financing activities
Cash from lease-related performance obligations	854	1,338
Payment for purchase of capped calls	(8,907)
Proceeds from issuance of common stock from the employee stock purchase plan	1,966	1,809
Proceeds from exercise of stock options	2,073	2,248
Tax withholdings paid on behalf of employees for net share settlement	(5,932)	(10,763)
Net cash provided by financing activities	(1,039)	(5,368)
Net increase in cash and cash equivalents	5,538	55,950
Cash and cash equivalents at beginning of period	25,704	34,276
Cash and cash equivalents at end of period	31,242
Supplemental disclosure of non-cash investing and financing activities:
Property and equipment in accounts payable and accrued liabilities	$ 314	$ 931

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 and Performance stock units	Restricted stock units and Performance stock unitsCommon Stock [Member]	Restricted stock units and Performance 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 on investments, net of tax	$ 425			425
Stock Issued During Period, Shares, Employee Stock Purchase Plans	61,691
Net loss	$ (16,294)
Change in unrealized gain on investments, net of tax	756
Shares, Outstanding		30,891,117
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	157,394	$ 9	301,484	(18)	(144,081)
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period		37,239
Stock Issued During Period, Value, Stock Options Exercised	527		527
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings							434,838
Adjustments to Additional Paid in Capital, Other	$ (8,796)							(8,796)
Stock Issued During Period, Shares, Employee Stock Purchase Plans	61,691
Stock Issued During Period, Value, Employee Stock Purchase Plan	$ 1,809
APIC, Share-based Payment Arrangement, Increase for Cost Recognition	6,109		6,109
Net loss	(4,857)				(4,857)
Change in unrealized gain on investments, net of tax	294			294
Shares, Outstanding		31,424,885
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	152,480	$ 9	301,133	276	(148,938)
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period		10,820
Stock Issued During Period, Value, Stock Options Exercised	157		157
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings							45,552
Adjustments to Additional Paid in Capital, Other	$ (696)	$ 1						(697)
Stock Issued During Period, Shares, Employee Stock Purchase Plans	0
Stock Issued During Period, Value, Employee Stock Purchase Plan	$ 6,169
APIC, Share-based Payment Arrangement, Increase for Cost Recognition			6,169
Net loss	298				298
Change in unrealized gain on investments, net of tax	37			37
Shares, Outstanding		31,481,257
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	158,445	$ 10	306,762	313	(148,640)
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
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 on investments, net of tax	$ (956)			(956)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period						741,736
Stock Issued During Period, Shares, Employee Stock Purchase Plans	126,046
Net loss	$ (9,777)
Change in unrealized gain on investments, net of tax	662
Shares, Outstanding		31,802,779
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	158,107	$ 9	319,671	(777)	(160,796)
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period		46,508
Stock Issued During Period, Value, Stock Options Exercised	594		594
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings							372,639
Adjustments to Additional Paid in Capital, Other	$ (4,716)							(4,716)
Stock Issued During Period, Shares, Employee Stock Purchase Plans	126,046
Stock Issued During Period, Value, Employee Stock Purchase Plan	$ 1,966
APIC, Share-based Payment Arrangement, Increase for Cost Recognition	6,366		6,366
Net loss	(3,468)				(3,468)
Change in unrealized gain on investments, net of tax	1,806			1,806
Shares, Outstanding		32,347,972
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	160,655	$ 9	323,881	1,029	(164,264)
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period		60,553
Stock Issued During Period, Value, Stock Options Exercised	749	$ 1	748
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings							22,682
Adjustments to Additional Paid in Capital, Other	$ (354)							$ (354)
Stock Issued During Period, Shares, Employee Stock Purchase Plans	0
Stock Issued During Period, Value, Employee Stock Purchase Plan	$ 6,679
APIC, Share-based Payment Arrangement, Increase for Cost Recognition			0
Net loss	4,161				4,161
Change in unrealized gain on investments, net of tax	(188)			(188)
Shares, Outstanding		32,431,207
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ 171,702	$ 10	$ 330,954	$ 841	$ (160,103)
Carrying amount of equity component, net of capped calls									$ 23,307

Revenue, deferred revenue, and

Revenue, deferred revenue, and deferred commissions	9 Months Ended
	Sep. 30, 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 devices (“Vocera Badge” or “Smartbadge”), perpetual software licenses, professional services and subscription 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 September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Product revenue Device $ 17,027 $ 19,002 $ 48,030 $ 43,566 Software 11,483 9,509 22,281 22,080 Total product 28,510 28,511 70,311 65,646 Service revenue Subscription and support 20,387 17,538 57,450 50,859 Professional services and training 4,918 4,732 14,074 14,344 Total service 25,305 22,270 71,524 65,203 Total revenue $ 53,815 $ 50,781 $ 141,835 $ 130,849 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 September 30, 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 September 30, 2020 and December 31, 2019, contract assets totaling $4.5 million and $4.3 million, respectively, were included in other receivables 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 and nine months ended September 30, 2020 are as follows: (in thousands) June 30, 2020 Additions Commissions Recognized September 30, 2020 Deferred commissions $ 11,118 $ 2,064 $ (1,857) $ 11,325 (in thousands) December 31, 2019 Additions Commissions Recognized September 30, 2020 Deferred commissions $ 10,477 $ 7,180 $ (6,332) $ 11,325 Of the $11.3 million total deferred commissions balance as of September 30, 2020, the Company expects to recognize approximately 49% 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 and nine months ended September 30, 2020 are as follows: (in thousands) June 30, 2020 Additions Revenue Recognized September 30, 2020 Deferred revenue $ 54,014 $ 25,866 $ (22,472) $ 57,408 (in thousands) December 31, 2019 Additions Revenue Recognized September 30, 2020 Deferred revenue $ 61,475 $ 58,197 $ (62,264) $ 57,408 Revenue recognized during the three and nine months ended September 30, 2020 from deferred revenue balances at the beginning of the period was $18.5 million and $46.0 million, respectively. Revenue recognized during the three and nine months ended September 30, 2019 from deferred revenue balances at the beginning of the period was $17.2 million and $40.0 million. The “contracted but not recognized” performance obligations represent the Company’s deferred revenue and non-cancelable backlog amounts. This balance as of September 30, 2020 w as $139.4 million, of which the Company expects to recognize approxi mately 70% as re venue over the next 12 months and the remainder thereafter.

Fair Value of Financial Instrum

Fair Value of Financial Instruments	9 Months Ended
	Sep. 30, 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 nine months ended September 30, 2020, there have been no transfers between Level 1 and Level 2 fair value instruments and no transfers 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. 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 September 30, 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 agreement for the acquisition of EASE Applications includes contingent payments to the owners of EASE Applications, payable based on achievement of post-acquisition financial metrics. This contingent consideration is a Level 3 fair value measurement and the valuation of the Company’s contingent consideration obligation was estimated as the present value of total expected contingent consideration payments which are determined using a Monte Carlo simulation. This analysis reflects the contractual terms of the purchase agreements and utilizes assumptions with regard to future sales, probabilities of achieving such future sales, the likelihood and timing of expected payments and a discount rate. Significant increases with respect to assumptions as to future sales and probabilities of achieving such future sales would result in a higher fair value measurement, while an increase in the discount rate would result in a lower fair value measurement. The unobservable inputs in the valuation include revenue volatility of 12.00%, a risk free rate of 0.13%, and the amounts are expected to be paid in the first quarters of 2022 and 2023. For the three month period ended September 30, 2020, the fair value adjustment for the contingent consideration which was recorded as other income and expense was minimal. The Company’s assets that are measured at fair value on a recurring basis, by level, within the fair value hierarchy as of September 30, 2020 and December 31, 2019, are summarized as follows (in thousands): September 30, 2020 December 31, 2019 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets Money market funds $ 6,702 $ — $ 6,702 $ 4,086 $ — $ — $ 4,086 Commercial paper — 7,497 7,497 — 12,854 — 12,854 U.S. government agency securities — — — — 3,000 — 3,000 Corporate debt securities — 172,498 172,498 — 188,310 — 188,310 Total assets measured at fair value $ 6,702 $ 179,995 $ — $ 186,697 $ 4,086 $ 204,164 $ — $ 208,250 Liabilities Contingent consideration $ — $ — $ 2,170 2,170 $ — $ — $ — $ — Total liabilities measured at fair value $ — $ — $ 2,170 $ 2,170 $ — $ — $ — $ —

Cash, Cash Equivalents and Shor

Cash, Cash Equivalents and Short-term Investments	9 Months Ended
	Sep. 30, 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 September 30, 2020 and December 31, 2019: As of September 30, 2020 Amortized Cost Unrealized Gains Unrealized Losses Fair value Cash and cash equivalents: Demand deposits and other cash $ 24,540 $ — $ — $ 24,540 Money market funds 6,702 — — 6,702 Total cash and cash equivalents 31,242 — — 31,242 Short-Term Investments: Commercial paper 7,494 3 — 7,497 Corporate debt securities 171,577 926 (5) 172,498 Total short-term investments 179,071 929 (5) 179,995 Total cash, cash equivalents and short-term investments $ 210,313 $ 929 $ (5) $ 211,237 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 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 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 no credit losses related to our marketable securities were required as of September 30, 2020. 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 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 September 30, 2020 Cash and cash equivalents (1) $ 31,242 $ — $ 31,242 Short-term investments 137,634 42,361 179,995 Cash, cash equivalents and short-term investments $ 168,876 $ 42,361 $ 211,237 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	9 Months Ended
	Sep. 30, 2020
Earnings Per Share [Abstract]
Net Loss Per Share	oss) 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 September 30, Nine months ended September 30, 2020 2019 2020 2019 Numerator: Net income (loss) $ 4,161 $ 298 $ (9,777) $ (16,294) Denominator: Weighted-average shares used to compute net income (loss) per common share - basic 32,394 31,459 32,096 31,170 Effect of potentially dilutive securities: Employee stock options, including ESPP 241 308 — — Restricted stock units and performance based restricted stock units 384 177 — — Weighted-average shares used to compute net income (loss) per common share - diluted 33,019 31,944 32,096 31,170 Net income (loss) per share Basic $ 0.13 $ 0.01 $ (0.30) $ (0.52) Diluted $ 0.13 $ 0.01 $ (0.30) $ (0.52) The following securities were not included in the calculation of diluted shares outstanding as the effect would have been anti-dilutive: Three months ended September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Options to purchase common stock, including ESPP — 73 555 485 Restricted stock units and Performance stock units 450 772 1,972 1,431

Balance Sheet Components

Balance Sheet Components	9 Months Ended
	Sep. 30, 2020
Balance Sheet Components [Abstract]
Balance Sheet Components	Balance Sheet Components Inventories (in thousands) September 30, December 31, Raw materials $ 620 $ 831 Finished goods 9,831 3,745 Total inventories $ 10,451 $ 4,576 Property and equipment, net (in thousands) September 30, December 31, Computer equipment and software $ 15,087 $ 13,596 Furniture, fixtures and equipment 2,569 2,430 Leasehold improvements 5,295 5,283 Manufacturing tools and equipment 2,460 2,435 Construction in process 617 582 Property and equipment, at cost 26,028 24,326 Less: Accumulated depreciation (17,958) (15,665) Property and equipment, net $ 8,070 $ 8,661 Depreciation and amortization expense for property and equipment was $1.1 million and $0.9 million for the three months ended September 30, 2020 and 2019, respectively. Depreciation and amortization expense for property and equipment was $3.3 million and $2.7 million for the nine months ended September 30, 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) September 30, December 31, Minimum payments to be received on sales-type leases $ 1,518 $ 2,078 Less: Unearned interest income and executory revenue portion (779) (1,190) Net investment in sales-type leases 739 888 Less: Current portion (392) (452) Non-current net investment in sales-type leases $ 347 $ 436 Sales-type lease activity recognized in the condensed consolidated statement of operations are as follows: Three months ended September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Lease revenue $ 1,140 $ 2,228 $ 2,693 $ 5,592 Less: Cost of lease shipments (211) (676) (386) (1,533) Gross profit $ 929 $ 1,552 $ 2,307 $ 4,059 Interest expense, net on lease receivable $ (5) $ (5) $ (17) $ (5) Initial direct cost incurred $ 63 $ 89 $ 146 $ 229 There were no allowances for doubtful accounts on these leases as of September 30, 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 September 30, 2020 were as follows: (in thousands) Future lease payments 2020 (remaining three months) $ 199 2021 705 2022 476 2023 138 Total $ 1,518 Accrued payroll and other current liabilities (in thousands) September 30, December 31, Payroll and related expenses $ 7,835 $ 6,053 Accrued payables 2,359 2,674 Operating lease liabilities, current portion 2,433 2,323 Lease financing, current portion 901 1,033 Product warranty 406 420 Customer prepayments 1,000 631 Sales and use tax payable 435 599 Other 1,843 1,024 Total accrued payroll and other current liabilities $ 17,212 $ 14,757 The changes in the Company’s product warranty reserve are as follows: Three months ended September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Warranty balance at the beginning of the period $ 521 $ 355 $ 420 $ 376 Warranty expense accrued for shipments during the period 98 138 320 307 Changes in estimate related to pre-existing warranties (161) (45) (151) (131) Warranty settlements made (52) (47) (183) (151) Total product warranty $ 406 $ 401 $ 406 $ 401 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 four months to approximately five years. Operating lease cost, including short-term operating leases was $0.8 million and $0.6 million for the three months ended September 30, 2020 and 2019, respectively and $2.2 million and $1.7 million for the nine months ended September 30, 2020 and 2019, respectively. Supplemental balance sheet information related to leases was as follows: (in thousands) September 30, Other long-term assets $ 4,716 Accrued payroll and other current liabilities 2,433 Other long-term liabilities 2,922 Total operating lease liabilities $ 5,355 Other information related to leases was as follows: Three months ended September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Supplemental Cash Flow Information Cash paid for amounts included in the measurement of lease liabilities $ 740 $ 645 $ 2,184 1,909 Right-of-use assets obtained in exchange for lease obligations $ 17 $ — $ 139 1,018 Weighted average remaining lease term 2.26 years 2.62 years 2.26 years 2.62 years Weighted average discount rate 8 % 8 % 8 % 8 % Maturities of lease liabilities as of September 30, 2020 are as follows: (in thousands) Operating leases 2020 (remaining three months) $ 693 2021 3,021 2022 1,376 2023 443 2024 319 Total maturities of lease liabilities 5,852 Less imputed interest (497) Total $ 5,355

Convertible Senior Notes

Convertible Senior Notes	9 Months Ended
	Sep. 30, 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 nine months ended September 30, 2020, the conditions allowing holders of the Notes to convert have not been met. The Notes are therefore not convertible during the nine months ended September 30, 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) September 30, December 31, Liability: Principal $ 143,750 $ 143,750 Unamortized debt discount (19,087) (23,880) Unamortized issuance costs (2,152) (2,692) Net carrying amount $ 122,511 $ 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 September 30, 2020 was approximately $161.7 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 $29.08 on September 30, 2020, the if-converted value of the Notes of $129.6 million was less than their principal amount. Interest expense related to the Notes is as follows: Three months ended September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Contractual interest expense $ 539 $ 539 $ 1,617 $ 1,617 Amortization of debt discount 1,644 1,521 4,793 4,414 Amortization of issuance costs 185 172 540 498 Total interest expense $ 2,368 $ 2,232 $ 6,950 $ 6,529 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) September 30, 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	9 Months Ended
	Sep. 30, 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 September 30, 2020 and December 31, 2019, approxi mately $7.5 million an d $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	9 Months Ended
	Sep. 30, 2020
Share-based Payment Arrangement [Abstract]
Stock-based Compensation and Award	Stock-based Compensation and Awards Valuation Assumptions Compensation expense for all share-based payment awards, including stock options, restricted stock units (“RSUs”), and performance stock units (“PSUs”), is measured based on the estimated fair value of the award on the grant date over the related vesting or performance periods. We estimate the fair value of our stock-based awards as follows: Restricted Stock Units. The fair value of restricted stock units is determined based on the quoted market price of our common stock on the date of grant. Performance Stock Units. Performance stock units consist of grants of performance-based restricted stock units to certain members of executive management that vest contingent upon the achievement of pre-determined market and service conditions (referred to herein as “performance stock units”). The fair value of our performance stock units is estimated using a Monte-Carlo simulation model which is a probabilistic approach for calculating the fair value of the awards. The Monte-Carlo simulation is a statistical technique used, in this instance, to simulate future stock prices of the Company relative to constituents in the S&P 600 Health Care Equipment and Services Index. Key assumptions for the Monte-Carlo simulation model are the risk-free interest rate, expected volatility, expected dividends and correlation coefficient. Stock Options and Employee Stock Purchase Plan . The fair value of stock options and stock purchase rights granted pursuant to our equity incentive plans and our 2012 Employee Stock Purchase Plan (ESPP), respectively, is estimated using the Black-Scholes valuation model based on the multiple-award valuation method. Key assumptions of the Black-Scholes valuation model are the risk-free interest rate, expected volatility, expected term and expected dividends. The risk-free interest rate is based on U.S. Treasury yields in effect at the time of grant for the expected term of the option. Expected volatility is based on a combination of historical stock price volatility. An expected term is estimated based on historical exercise behavior, post-vesting termination patterns, options outstanding and future expected exercise behavior. Stock Option Activity A summary of the stock option activity for the nine months ended September 30, 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 (184,970) 11.21 Options canceled (1,700) 9.40 Outstanding at September 30, 2020 419,657 $ 14.40 2.75 $ 6,159 At September 30, 2020, there was no unrecognized compensation cost related to options. As of September 30, 2020, there were 855,509 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. During the nine months ended September 30, 2020 employees purchased 126,046 shares of common stock at an average price of $15.60. During the nine months ended September 30, 2019 employees purchased 61,691 shares of common stock at an average price of $29.32. As of September 30, 2020, there were 1,063,572 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 September 30, Nine months ended September 30, 2020 2019 2020 2019 Expected term (in years) 0.50 0.50 0.50 0.50 Volatility 54.1% 45.2% 50% - 54.14% 33% - 45.2% Risk-free interest rate 0.15% 2.43% 0.15% - 1.59% 2.43% - 2.51% Dividend yield 0% 0% 0% 0% Restricted Stock Units and Performance Stock Units A summary of RSU and PSU activity for the nine months ended September 30, 2020 is presented below: Restricted Stock Units and Performance Stock Units Number of shares Weighted Average Grant Date Fair Value per Share Outstanding at December 31, 2019 1,550,646 $ 28.94 Granted 1,395,557 22.28 Vested (741,736) 28.03 Forfeited (49,010) 26.58 Outstanding at September 30, 2020 2,155,457 $ 24.99 At September 30, 2020, there was $42.1 million of unrecognized compensation cost related to RSUs and PSUs, which is expected to be recognized over a weighted-average period of 1.98 years. During the second quarter of this fiscal year we granted 145,877 PSUs to certain executives under our 2012 Equity Incentive Plan (the “2012 Plan”). PSUs are contingent on the achievement of our comparative market-based returns. On the date of grant, we estimated the fair value of the total shareholder return (TSR) component of the PSUs using a Monte Carlo valuation model. The PSUs will vest over a three-year performance period. The number of shares the PSU holder receives is based on the extent to which the corresponding market conditions have been achieved. For awards subject to service and market conditions, the number of shares of our stock issued pursuant to the award can range from 0% to 200% of the target amount. Compensation expense for awards with performance-based and service-based conditions is recognized over the requisite service period if it is probable that the performance condition will be satisfied. The expense for performance-based awards is evaluated each quarter based on the achievement of the performance conditions. The assumptions used in the Monte Carlo valuation model to value the PSUs were as follows: September 30, Grant date fair value per share $ 30.70 Expected term (in years) 3 Volatility 42.68 % Risk-free interest rate 0.20 % Dividend yield — % Allocation of Stock-Based Compensation Expense The following table presents the allocation of stock-based compensation expense: Three months ended September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Cost of revenue $ 1,042 $ 1,175 $ 3,129 $ 3,331 Research and development 1,046 1,022 3,035 2,878 Sales and marketing 2,037 1,808 5,858 5,286 General and administrative 2,554 2,164 6,864 6,327 Total stock-based compensation $ 6,679 $ 6,169 $ 18,886 $ 17,822

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2020
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The Company recorded a $1.5 million and $(0.1) million benefit from (provision for) income taxes for the nine months ended September 30, 2020 and 2019, respectively. The benefit from income taxes for the nine months ended September 30, 2020 was primarily due to the release of a valuation allowance as a result of the acquisition of EASE Applications. The provision recorded for the nine months ended September 30, 2019 was primarily due to the accretion of the deferred tax liability associated with indefinite lived intangibles, the tax effect of unrealized gains on investments recorded within other comprehensive income, taxes on international operations and state income taxes. As of September 30, 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. On August 18, 2020, as part of the acquisition of EASE Applications, the Company recorded $2.1 million in deferred tax liabilities, related to the intangible assets acquired. Changes in the acquiring company’s deferred tax assets or liabilities subsequent to a business combination are required to be recorded in income during the period in which the transaction occurs. The Company was able to offset these deferred tax liabilities with a release of a portion of the Company’s valuation allowance. Accordingly, the $2.1 million decrease in the Company’s net deferred tax assets resulted in the release of a corresponding $2.1 million valuation allowance and recognition of a tax benefit as of September 30, 2020. 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

Business Acquisitions

Business Acquisitions	9 Months Ended
	Sep. 30, 2020
Business Combinations [Abstract]
Business Acquisitions	Business Acquisitions Acquisition of EASE Applications, LLC On August 18, 2020, the Company acquired all of the outstanding equity interest of EASE Applications for $24.2 million in cash, net of $0.3 million of cash acquired. EASE Applications, now called Vocera Ease, offers a cloud-based communication platform and mobile application built to improve the patient experience by enabling friends and family members to receive timely updates about the progress of their loved one in the hospital. Vocera Ease enables nurses and other care team members to send Health Insurance and Portability and Accountability Act (HIPAA)-compliant texts, photos, and video updates to patients’ loved ones, putting them at ease and saving valuable time. With this acquisition, Vocera further strengthened its ability to fulfill its mission to improve the lives of patients, families and care teams. The following table presents the preliminary fair value of the identifiable assets acquired and liabilities assumed as of the acquisition date: (in thousands, except useful lives) Fair value acquired Useful life (years) Assets Current Assets Accounts receivable, net $ 444 Prepaid expenses and other current assets 18 Total current assets 462 Intangibles assets Customer relationships 5,430 8 Developed technology 2,310 3 Trademarks 660 3 Backlog 840 4 Goodwill 19,922 Total assets $ 29,624 Liabilities Current liabilities Accounts payable $ 6 Accrued payroll and other current liabilities 22 Deferred revenue, current 1,011 Total current liabilities 1,039 Deferred revenue, long term 149 Other long-term liabilities 4,218 Total liabilities 5,406 Net assets acquired $ 24,218 The estimated fair values of identifiable intangible assets were primarily determined using discounted cash flow models. The estimation of the fair value of the intangible assets required the use of valuation techniques and entailed consideration of all the relevant factors that might affect the fair value, such as present value factors and estimates of future revenues and costs. The amortization of developed technology and backlog is recorded in "cost of revenues" for product and the amortization for the remaining intangibles is recorded in "sales and marketing" expenses on the consolidated statement of operations. The excess of the acquisition consideration over the fair values of the underlying net assets acquired was recorded as goodwill. Goodwill is largely attributed to the synergy of EASE Applications proprietary solutions with the Company’s existing customer base, dedicated sales force and cross selling opportunities with the Company’s other solutions. Goodwill is not amortized but instead is tested for impairment at least annually or more frequently if indicators of impairment are present. The agreement also included contingent payments to the owners of EASE Applications, payable based on achievement of post-acquisition financial metrics as of December 31, 2021 and December 31, 2022. If these financial metrics are achieved the Company will owe additional purchase price consideration of $2.5 million as of December 31, 2021 and 2022. This contingent consideration was fair valued in connection with the acquisition and resulted in a liability of $2.2 million as of the acquisition date. The estimated fair value was determined using a Monte Carlo valuation model. The fair value of this liability will be remeasured each reporting period and the change in fair value will be recorded as other income and expense. For the three month period ended September 30, 2020 this fair value adjustment was minimal. The Company incurred $0.5 million of acquisition-related costs that were expensed as incurred. These costs are recorded as general and administrative expenses in the consolidated statement of operations. Additionally, in connection with the acquisition the Company established a retention bonus plan for continuing EASE Applications employees with potential additional compensation over a two-year period of approximately $5.0 million, based on achievement of financial metrics and continued employment. Such amounts are not considered part of the purchase consideration and are being recorded as compensation expense as earned. During the three-months ended September 30, 2020, $0.4 million of this retention bonus was recorded as compensation expense. The acquisition did not result in material contributions to revenue or net income in the consolidated financial statements at the acquisition date. Additionally, pro forma financial information is not provided for consolidated revenue and net income as such amounts attributable to EASE Applications were insignificant.

The Company and Summary of Sign

The Company and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 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 majority of the Company’s revenue comes from the sale of its communication and collaboration solution which includes: an intelligent enterprise software platform; the lightweight, wearable, voice-controlled communication Badge and 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. The Company also offers a range of SaaS solutions focused on patient and family experience, staff engagement and operational quality across the continuum of care from pre-arrival through post-discharge.
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. 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	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, contingent consideration 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. In December 2019, the FASB issued new guidance 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. In the second quarter of fiscal year 2020, the Company early adopted the guidance on a prospective basis. The adoption did not have a material impact on the Company's condensed consolidated financial statements. Recent Accounting Pronouncements In August 2020, the FASB issued new guidance to simplify the accounting for convertible instruments by removing certain separation models. Under the amendments, the embedded conversion features are no longer separated from the host contract for convertible instruments with conversion features that are not required to be accounted for as derivatives, or that do not result in substantial premiums accounted for as paid-in capital. A convertible debt instrument will be accounted for as a single liability measured at its amortized cost and a convertible preferred stock will be accounted for as a single equity instrument measured at its historical cost, as long as no other features require bifurcation and recognition as derivatives. The guidance will be effective beginning January 1, 2022. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. The Company is currently evaluating the impact of this new guidance on its 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 nine months ended September 30, 2020, there have been no transfers between Level 1 and Level 2 fair value instruments and no transfers 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. 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 September 30, 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 agreement for the acquisition of EASE Applications includes contingent payments to the owners of EASE Applications, payable based on achievement of post-acquisition financial metrics. This contingent consideration is a Level 3 fair value measurement and the valuation of the Company’s contingent consideration obligation was estimated as the present value of total expected contingent consideration payments which are determined using a Monte Carlo simulation. This analysis reflects the contractual terms of the purchase agreements and utilizes assumptions with regard to future sales, probabilities of achieving such future sales, the likelihood and timing of expected payments and a discount rate. Significant increases with respect to assumptions as to future sales and probabilities of achieving such future sales would result in a higher fair value measurement, while an increase in the discount rate would result in a lower fair value measurement. The unobservable inputs in the valuation include revenue volatility of 12.00%, a risk free rate of 0.13%, and the amounts are expected to be paid in the first quarters of 2022 and 2023. For the three month period ended September 30, 2020, the fair value adjustment for the contingent consideration which was recorded as other income and expense was minimal.
Intangible Assets, Policy	Goodwill As of September 30, 2020 and December 31, 2019, the Company had $69.2 million and $49.2 million of goodwill, respectively. The addition to goodwill during the three and nine months ended September 30, 2020 of $19.9 million was based on the purchase price allocations of the acquisition completed during the three months ended September 30, 2020 (See Note 12). As of September 30, 2020, there were no changes in circumstances indicating that the carrying values of goodwill or acquired intangibles may not be recoverable. Intangible Assets
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 September 30, 2020 and December 31, 2019, approxi mately $7.5 million an d $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	Segment Reporting Beginning in the third quarter of fiscal year 2020, the Company’s chief operating decision maker (CODM) receives and regularly reviews financial information on an entity-wide basis. This change coincided with the Company’s acquisition of EASE, and resulted in the CODM considering entity-wide financial information in deciding how to allocate resources and in assessing performance of the Company’s communication and clinical workflow solutions and services business. There are no segment managers who are held accountable for operations, operating results or plans for levels or components. The Company’s CODM is its Chief Executive Officer. As a result, beginning in the third quarter of fiscal year 2020, the Company reports its financial performance consistent with its single reporting segment and operating unit structure. For comparability

Revenue, deferred revenue, an_2

Revenue, deferred revenue, and deferred commissions (Tables)	9 Months Ended
	Sep. 30, 2020
Revenue from Contract with Customer [Abstract]
Disaggregation of Revenue	Disaggregation of Revenue A typical sales arrangement involves multiple arrangements, such as the sales of the Company’s proprietary communication devices (“Vocera Badge” or “Smartbadge”), perpetual software licenses, professional services and subscription 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 September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Product revenue Device $ 17,027 $ 19,002 $ 48,030 $ 43,566 Software 11,483 9,509 22,281 22,080 Total product 28,510 28,511 70,311 65,646 Service revenue Subscription and support 20,387 17,538 57,450 50,859 Professional services and training 4,918 4,732 14,074 14,344 Total service 25,305 22,270 71,524 65,203 Total revenue $ 53,815 $ 50,781 $ 141,835 $ 130,849
Contract with Customer, Asset and Liability	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 September 30, 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 September 30, 2020 and December 31, 2019, contract assets totaling $4.5 million and $4.3 million, respectively, were included in other receivables 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 and nine months ended September 30, 2020 are as follows: (in thousands) June 30, 2020 Additions Commissions Recognized September 30, 2020 Deferred commissions $ 11,118 $ 2,064 $ (1,857) $ 11,325 (in thousands) December 31, 2019 Additions Commissions Recognized September 30, 2020 Deferred commissions $ 10,477 $ 7,180 $ (6,332) $ 11,325 Of the $11.3 million total deferred commissions balance as of September 30, 2020, the Company expects to recognize approximately 49% as commission expense over the next 12 months and the remainder thereafter. Deferred revenue

Fair Value of Financial Insturm

Fair Value of Financial Insturments (Tables)	9 Months Ended
	Sep. 30, 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 September 30, 2020 and December 31, 2019, are summarized as follows (in thousands): September 30, 2020 December 31, 2019 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets Money market funds $ 6,702 $ — $ 6,702 $ 4,086 $ — $ — $ 4,086 Commercial paper — 7,497 7,497 — 12,854 — 12,854 U.S. government agency securities — — — — 3,000 — 3,000 Corporate debt securities — 172,498 172,498 — 188,310 — 188,310 Total assets measured at fair value $ 6,702 $ 179,995 $ — $ 186,697 $ 4,086 $ 204,164 $ — $ 208,250 Liabilities Contingent consideration $ — $ — $ 2,170 2,170 $ — $ — $ — $ — Total liabilities measured at fair value $ — $ — $ 2,170 $ 2,170 $ — $ — $ — $ —

Cash, Cash Equivalents and Sh_2

Cash, Cash Equivalents and Short-term Investments (Tables)	9 Months Ended
	Sep. 30, 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 September 30, 2020 and December 31, 2019: As of September 30, 2020 Amortized Cost Unrealized Gains Unrealized Losses Fair value Cash and cash equivalents: Demand deposits and other cash $ 24,540 $ — $ — $ 24,540 Money market funds 6,702 — — 6,702 Total cash and cash equivalents 31,242 — — 31,242 Short-Term Investments: Commercial paper 7,494 3 — 7,497 Corporate debt securities 171,577 926 (5) 172,498 Total short-term investments 179,071 929 (5) 179,995 Total cash, cash equivalents and short-term investments $ 210,313 $ 929 $ (5) $ 211,237 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 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 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 September 30, 2020 Cash and cash equivalents (1) $ 31,242 $ — $ 31,242 Short-term investments 137,634 42,361 179,995 Cash, cash equivalents and short-term investments $ 168,876 $ 42,361 $ 211,237 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)	9 Months Ended
	Sep. 30, 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 September 30, Nine months ended September 30, 2020 2019 2020 2019 Numerator: Net income (loss) $ 4,161 $ 298 $ (9,777) $ (16,294) Denominator: Weighted-average shares used to compute net income (loss) per common share - basic 32,394 31,459 32,096 31,170 Effect of potentially dilutive securities: Employee stock options, including ESPP 241 308 — — Restricted stock units and performance based restricted stock units 384 177 — — Weighted-average shares used to compute net income (loss) per common share - diluted 33,019 31,944 32,096 31,170 Net income (loss) per share Basic $ 0.13 $ 0.01 $ (0.30) $ (0.52) Diluted $ 0.13 $ 0.01 $ (0.30) $ (0.52)
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 September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Options to purchase common stock, including ESPP — 73 555 485 Restricted stock units and Performance stock units 450 772 1,972 1,431

Goodwill and Intangible Assets

Goodwill and Intangible Assets (Tables)	9 Months Ended
	Sep. 30, 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: September 30, 2020 December 31, 2019 (in thousands) Weighted Average Gross Accumulated Net Gross Accumulated Net Developed technology 3.9 $ 12,360 $ 10,023 $ 2,337 $ 10,050 $ 9,803 $ 247 Customer relationships 8.0 16,350 6,705 9,645 10,920 5,819 5,101 Backlog 3.4 2,240 1,310 930 1,400 1,287 113 Non-compete agreements 460 460 — 460 460 — Trademarks 3.0 1,770 1,136 634 1,110 1,110 — Intangible assets, net book value $ 33,180 $ 19,634 $ 13,546 $ 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 September 30, 2020 was as follows: (in thousands) Future amortization 2020 (remaining three months) $ 863 2021 3,244 2022 2,965 2023 2,444 2024 1,564 2025 679 Thereafter 1,787 Future amortization expense $ 13,546

Balance Sheet Components (Table

Balance Sheet Components (Tables)	9 Months Ended
	Sep. 30, 2020
Balance Sheet Components [Abstract]
Inventories	Inventories (in thousands) September 30, December 31, Raw materials $ 620 $ 831 Finished goods 9,831 3,745 Total inventories $ 10,451 $ 4,576
Property and Equipment	Property and equipment, net (in thousands) September 30, December 31, Computer equipment and software $ 15,087 $ 13,596 Furniture, fixtures and equipment 2,569 2,430 Leasehold improvements 5,295 5,283 Manufacturing tools and equipment 2,460 2,435 Construction in process 617 582 Property and equipment, at cost 26,028 24,326 Less: Accumulated depreciation (17,958) (15,665) Property and equipment, net $ 8,070 $ 8,661
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) September 30, December 31, Minimum payments to be received on sales-type leases $ 1,518 $ 2,078 Less: Unearned interest income and executory revenue portion (779) (1,190) Net investment in sales-type leases 739 888 Less: Current portion (392) (452) Non-current net investment in sales-type leases $ 347 $ 436 Sales-type lease activity recognized in the condensed consolidated statement of operations are as follows: Three months ended September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Lease revenue $ 1,140 $ 2,228 $ 2,693 $ 5,592 Less: Cost of lease shipments (211) (676) (386) (1,533) Gross profit $ 929 $ 1,552 $ 2,307 $ 4,059 Interest expense, net on lease receivable $ (5) $ (5) $ (17) $ (5) Initial direct cost incurred $ 63 $ 89 $ 146 $ 229
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 September 30, 2020 were as follows: (in thousands) Future lease payments 2020 (remaining three months) $ 199 2021 705 2022 476 2023 138 Total $ 1,518
Accrued Liabilities	Accrued payroll and other current liabilities (in thousands) September 30, December 31, Payroll and related expenses $ 7,835 $ 6,053 Accrued payables 2,359 2,674 Operating lease liabilities, current portion 2,433 2,323 Lease financing, current portion 901 1,033 Product warranty 406 420 Customer prepayments 1,000 631 Sales and use tax payable 435 599 Other 1,843 1,024 Total accrued payroll and other current liabilities $ 17,212 $ 14,757
Schedule of Product Warranty Liability	The changes in the Company’s product warranty reserve are as follows: Three months ended September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Warranty balance at the beginning of the period $ 521 $ 355 $ 420 $ 376 Warranty expense accrued for shipments during the period 98 138 320 307 Changes in estimate related to pre-existing warranties (161) (45) (151) (131) Warranty settlements made (52) (47) (183) (151) Total product warranty $ 406 $ 401 $ 406 $ 401
Information Related to Leases	Supplemental balance sheet information related to leases was as follows: (in thousands) September 30, Other long-term assets $ 4,716 Accrued payroll and other current liabilities 2,433 Other long-term liabilities 2,922 Total operating lease liabilities $ 5,355 Other information related to leases was as follows: Three months ended September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Supplemental Cash Flow Information Cash paid for amounts included in the measurement of lease liabilities $ 740 $ 645 $ 2,184 1,909 Right-of-use assets obtained in exchange for lease obligations $ 17 $ — $ 139 1,018 Weighted average remaining lease term 2.26 years 2.62 years 2.26 years 2.62 years Weighted average discount rate 8 % 8 % 8 % 8 %

Convertible Senior Notes (Table

Convertible Senior Notes (Tables)	9 Months Ended
	Sep. 30, 2020
Debt Disclosure [Abstract]
Schedule of Notes	The Notes consist of the following: (in thousands) September 30, December 31, Liability: Principal $ 143,750 $ 143,750 Unamortized debt discount (19,087) (23,880) Unamortized issuance costs (2,152) (2,692) Net carrying amount $ 122,511 $ 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 September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Contractual interest expense $ 539 $ 539 $ 1,617 $ 1,617 Amortization of debt discount 1,644 1,521 4,793 4,414 Amortization of issuance costs 185 172 540 498 Total interest expense $ 2,368 $ 2,232 $ 6,950 $ 6,529
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) September 30, 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)	9 Months Ended
	Sep. 30, 2020
Share-based Payment Arrangement [Abstract]
Rollforward of stock option activity	A summary of the stock option activity for the nine months ended September 30, 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 (184,970) 11.21 Options canceled (1,700) 9.40 Outstanding at September 30, 2020 419,657 $ 14.40 2.75 $ 6,159
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 September 30, Nine months ended September 30, 2020 2019 2020 2019 Expected term (in years) 0.50 0.50 0.50 0.50 Volatility 54.1% 45.2% 50% - 54.14% 33% - 45.2% Risk-free interest rate 0.15% 2.43% 0.15% - 1.59% 2.43% - 2.51% Dividend yield 0% 0% 0% 0%
Rollforward of RSA and RSU activty	A summary of RSU and PSU activity for the nine months ended September 30, 2020 is presented below: Restricted Stock Units and Performance Stock Units Number of shares Weighted Average Grant Date Fair Value per Share Outstanding at December 31, 2019 1,550,646 $ 28.94 Granted 1,395,557 22.28 Vested (741,736) 28.03 Forfeited (49,010) 26.58 Outstanding at September 30, 2020 2,155,457 $ 24.99
PSU Valuation Assumptions	The assumptions used in the Monte Carlo valuation model to value the PSUs were as follows: September 30, Grant date fair value per share $ 30.70 Expected term (in years) 3 Volatility 42.68 % Risk-free interest rate 0.20 % Dividend yield — %
Allocation of Recognized Period Costs	The following table presents the allocation of stock-based compensation expense: Three months ended September 30, Nine months ended September 30, (in thousands) 2020 2019 2020 2019 Cost of revenue $ 1,042 $ 1,175 $ 3,129 $ 3,331 Research and development 1,046 1,022 3,035 2,878 Sales and marketing 2,037 1,808 5,858 5,286 General and administrative 2,554 2,164 6,864 6,327 Total stock-based compensation $ 6,679 $ 6,169 $ 18,886 $ 17,822

Business Acquisition (Tables)

Business Acquisition (Tables)	9 Months Ended
	Sep. 30, 2020
Business Combinations [Abstract]
Schedule of Identifiable Assets Acquired and Liabilities Assumed	The following table presents the preliminary fair value of the identifiable assets acquired and liabilities assumed as of the acquisition date: (in thousands, except useful lives) Fair value acquired Useful life (years) Assets Current Assets Accounts receivable, net $ 444 Prepaid expenses and other current assets 18 Total current assets 462 Intangibles assets Customer relationships 5,430 8 Developed technology 2,310 3 Trademarks 660 3 Backlog 840 4 Goodwill 19,922 Total assets $ 29,624 Liabilities Current liabilities Accounts payable $ 6 Accrued payroll and other current liabilities 22 Deferred revenue, current 1,011 Total current liabilities 1,039 Deferred revenue, long term 149 Other long-term liabilities 4,218 Total liabilities 5,406 Net assets acquired $ 24,218

The Company and Summary of Si_2

The Company and Summary of Significant Accounting Policies Narrative (Details) $ in Thousands	Sep. 30, 2020USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Total operating lease liabilities	$ 5,355

Revenue, deferred revenue, an_3

Revenue, deferred revenue, and deferred commissions - Consolidated Balance Sheet (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Jun. 30, 2020	Dec. 31, 2019
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Other receivables	$ 6,263		$ 6,312
Deferred revenue, current	47,884		50,033
Deferred revenue, long-term	9,524		11,442
Total deferred revenue	57,408	$ 54,014	61,475
Stockholders' equity	$ 171,702		$ 163,825

Revenue, deferred revenue, an_4

Revenue, deferred revenue, and deferred commissions - Consolidated Statement of Operations (Details) - USD ($) $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2020	Sep. 30, 2019
Revenue
Total revenue	$ 53,815			$ 50,781			$ 141,835	$ 130,849
Gross Profit	36,330			31,888			90,059	78,589
Operating expenses	32,314			30,289			96,970	91,990
Operating Income (Loss)	4,016			1,599			(6,911)	(13,401)
Net loss	4,161	$ (3,468)	$ (10,470)	298	$ (4,857)	$ (11,735)	(9,777)	(16,294)
Product
Revenue
Total revenue	28,510			28,511			70,311	65,646
Service
Revenue
Total revenue	$ 25,305			$ 22,270			$ 71,524	$ 65,203

Revenue, deferred revenue, an_5

Revenue, deferred revenue, and deferred commissions - Cash Flows From Operating Activities (Details) - USD ($) $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2020	Sep. 30, 2019
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Net loss	$ 4,161	$ (3,468)	$ (10,470)	$ 298	$ (4,857)	$ (11,735)	$ (9,777)	$ (16,294)
Adjustments to reconcile net loss to net cash used in operating activities:
Deferred commissions							(847)	336
Deferred revenue							$ (5,227)	$ (2,453)

Revenue, deferred revenue, an_6

Revenue, deferred revenue, and deferred commissions - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Total revenue	$ 53,815	$ 50,781	$ 141,835	$ 130,849
Product Segment [Member]
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Total revenue	28,510	28,511	70,311	65,646
Product Segment [Member] | Software [Member]
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Total revenue	11,483	9,509	22,281	22,080
Product Segment [Member] | Device [Member]
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Total revenue	17,027	19,002	48,030	43,566
Service Segment [Member]
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Total revenue	25,305	22,270	71,524	65,203
Service Segment [Member] | Maintenance and Support [Member]
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Total revenue	20,387	17,538	57,450	50,859
Service Segment [Member] | Professional Services and Training [Member]
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Total revenue	$ 4,918	$ 4,732	$ 14,074	$ 14,344

Revenue, deferred revenue, an_7

Revenue, deferred revenue, and deferred commissions - Significant Changes in Deferred Commissions (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2020
Change in Contract with Customer, Asset [Roll Forward]
Beginning balance	$ 11,118	$ 10,477
Additions	2,064	7,180
Commissions Recognized	(1,857)	(6,332)
Ending balance	$ 11,325	$ 11,325

Revenue, deferred revenue, an_8

Revenue, deferred revenue, and deferred commissions - Significant Changes in Deferred Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Revenue from Contract with Customer [Abstract]
Revenue recognized pertaining to amounts deferred as of Beginning of Period	$ 18,500		$ 46,000
Revenue recognized pertaining to amounts deferred as of End of Period		$ 17,200		$ 40,000
Change in Contract with Customer, Liability [Roll Forward]
Beginning balance	54,014		61,475
Additions	25,866		58,197
Revenue Recognized	(22,472)		(62,264)
Ending balance	$ 57,408		$ 57,408

Revenue, deferred revenue, an_9

Revenue, deferred revenue, and deferred commissions - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Jun. 30, 2020	Dec. 31, 2019
Revenue from Contract with Customer [Abstract]
Payment terms on invoiced amounts			30 days
Deferred commissions	$ 11,325		$ 11,325		$ 11,118	$ 10,477
Percentage of deferred commissions to be recognized as commission expense in the next 12 months	49.00%		49.00%
Revenue recognized pertaining to amounts deferred as of Beginning of Period	$ 18,500		$ 46,000
Revenue recognized pertaining to amounts deferred as of End of Period		$ 17,200		$ 40,000
Deferred revenue and backlog	$ 139,400		$ 139,400
Percentage of deferred revenue to be recognized over the next 12 months	70.00%		70.00%
Contract with Customer, Asset, before Allowance for Credit Loss	$ 4,500		$ 4,500			$ 4,300

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Details)	9 Months Ended
	Sep. 30, 2020USD ($)	Dec. 31, 2019USD ($)
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	31,242,000	$ 25,704,000
Short-term investments	$ 179,995,000	204,164,000
Measurement Input, Revenue Volatility
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration liability, unobservable inputs	0.1200
Measurement Input, Risk Free Interest Rate
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration liability, unobservable inputs	0.0013
U.S. government agency securities
Assets, Fair Value Disclosure [Abstract]
Short-term investments		3,000,000
Corporate debt securities
Assets, Fair Value Disclosure [Abstract]
Short-term investments	$ 172,498,000	188,310,000
Fair Value, Measurements, Recurring
Assets, Fair Value Disclosure [Abstract]
Total assets measured at fair value	186,697,000	208,250,000
Contingent consideration	2,170,000	0
Total liabilities measured at fair value	2,170,000	0
Fair Value, Measurements, Recurring | Level 1
Assets, Fair Value Disclosure [Abstract]
Total assets measured at fair value	6,702,000	4,086,000
Contingent consideration	0	0
Total liabilities measured at fair value	0	0
Fair Value, Measurements, Recurring | Level 2
Assets, Fair Value Disclosure [Abstract]
Total assets measured at fair value	179,995,000	204,164,000
Contingent consideration	0	0
Total liabilities measured at fair value	0	0
Fair Value, Measurements, Recurring | Level 3
Assets, Fair Value Disclosure [Abstract]
Contingent consideration	2,170,000	0
Total liabilities measured at fair value	2,170,000	0
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	172,498,000	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	172,498,000	188,310,000
Fair Value, Measurements, Recurring | Money market funds
Assets, Fair Value Disclosure [Abstract]
Cash and cash equivalents	6,702,000	4,086,000
Fair Value, Measurements, Recurring | Money market funds | Level 1
Assets, Fair Value Disclosure [Abstract]
Cash and cash equivalents	6,702,000	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	7,497,000	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	$ 7,497,000	$ 12,854,000

Schedule of Available for Sale

Schedule of Available for Sale Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Cash and cash equivalents [Abstract]
Cash and Cash Equivalents, Amortized Cost	$ 31,242	$ 25,704
Cash And Cash Equivalents, Gross Unrealized Gains	0	0
Cash And Cash Equivalents, Gross Unrealized Losses	0	0
Cash and cash equivalents	31,242	25,704
Short-term Investments [Abstract]
AFS Securities, Amortized Cost Basis	179,071	203,727
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax	929	499
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax	5	62
Short-term investments	179,995	204,164
Cash, Cash Equivalents, and Short-term Investments [Abstract]
Cash, Cash Equiv. And S-T Investments, Amortized Cost	210,313	229,431
Cash, Cash Equivalents And Short Term Investments, Unrealized Gains	929	499
Cash, Cash Equivalents And Short Term Investments, Unrealized Losses	5	62
Cash, cash equivalents and short-term investments	211,237	229,868
Demand deposits and other cash
Cash and cash equivalents [Abstract]
Cash and Cash Equivalents, Amortized Cost	24,540	21,618
Cash And Cash Equivalents, Gross Unrealized Gains	0	0
Cash And Cash Equivalents, Gross Unrealized Losses	0	0
Cash and cash equivalents	24,540	21,618
Money market funds
Cash and cash equivalents [Abstract]
Cash and Cash Equivalents, Amortized Cost	6,702	4,086
Cash And Cash Equivalents, Gross Unrealized Gains	0	0
Cash And Cash Equivalents, Gross Unrealized Losses	0	0
Cash and cash equivalents	6,702	4,086
Commercial paper in STI
Short-term Investments [Abstract]
AFS Securities, Amortized Cost Basis	7,494	12,861
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax	3	0
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax	0	7
Short-term investments	7,497	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
Corporate Debt Securities
Short-term Investments [Abstract]
AFS Securities, Amortized Cost Basis	171,577	187,866
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax	926	499
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax	5	55
Short-term investments	$ 172,498	$ 188,310

Contractual maturities of cash,

Contractual maturities of cash, cash equivalent and short-term investment (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Debt Securities, Available-for-sale [Line Items]
Cash and cash equivalents	$ 31,242	$ 25,704
Short-term investments	179,995	204,164
Cash, cash equivalents and short-term investments	211,237	229,868
Maturity up to one year
Debt Securities, Available-for-sale [Line Items]
Cash and cash equivalents	31,242	25,704
Short-term investments	137,634	113,010
Cash, cash equivalents and short-term investments	168,876	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	42,361	91,154
Cash, cash equivalents and short-term investments	$ 42,361	$ 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						9 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2020	Sep. 30, 2019
Numerator:
Net loss	$ 4,161	$ (3,468)	$ (10,470)	$ 298	$ (4,857)	$ (11,735)	$ (9,777)	$ (16,294)
Denominator:
Weighted-average shares used to compute net income (loss) per common share - basic (in shares)	32,394			31,459			32,096	31,170
Weighted-average shares used to compute net income (loss) per common share - diluted (in shares)	33,019			31,944			32,096	31,170
Net income (loss) per share
Basic (in dollars per share)	$ 0.13			$ 0.01			$ (0.30)	$ (0.52)
Diluted (in dollars per share)	$ 0.13			$ 0.01			$ (0.30)	$ (0.52)
Stock options
Denominator:
Effect of potentially dilutive securities (in shares)	241			308			0	0
Restricted stock units and Performance stock units
Denominator:
Effect of potentially dilutive securities (in shares)	384			177			0	0

Schedule of antidilutive securi

Schedule of antidilutive securities excluded from computation of earnings per share (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 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	0	73	555	485
Restricted stock units and Performance stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	450	772	1,972	1,431

Schedule of Finite-Lived Intang

Schedule of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Finite-Lived Intangible Assets [Line Items]
2022	$ 2,965
2023	2,444
2024	1,564
2025	679
2020 (remaining three months)	863
Accumulated Amortization	19,634	$ 18,479
Future amortization expense	13,546
Intangible assets, gross	33,180	23,940
Intangible assets, net book value	$ 13,546	5,461
Developed technology
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life	3 years 10 months 24 days
Gross Carrying Amount	$ 12,360	10,050
Accumulated Amortization	10,023	9,803
Future amortization expense	$ 2,337	247
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life	8 years
Gross Carrying Amount	$ 16,350	10,920
Accumulated Amortization	6,705	5,819
Future amortization expense	$ 9,645	5,101
Backlog
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life	3 years 4 months 24 days
Gross Carrying Amount	$ 2,240	1,400
Accumulated Amortization	1,310	1,287
Future amortization expense	930	113
Non-compete agreements
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	460	460
Accumulated Amortization	460	460
Future amortization expense	$ 0	0
Trademarks
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life	3 years
Gross Carrying Amount	$ 1,770	1,110
Accumulated Amortization	1,136	1,110
Future amortization expense	$ 634	$ 0

Future amortization schedule (D

Future amortization schedule (Details) $ in Thousands	Sep. 30, 2020USD ($)
Goodwill and intangible assets [Abstract]
2020 (remaining three months)	$ 863
2021	3,244
2022	2,965
2023	2,444
2024	1,564
2025	679
Thereafter	1,787
Future amortization expense	$ 13,546

Goodwill and Intangible Asset_2

Goodwill and Intangible Assets Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Finite-Lived Intangible Assets [Line Items]
Goodwill	$ 69,168		$ 69,168		$ 49,246
Addition to goodwill	19,900		19,900
Intangibles - period amortization expense [Abstract]
Amortization expense	$ 500	$ 1,000	$ 1,200	$ 3,000

Inventories (Details)

Inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Inventory, Net [Abstract]
Raw materials	$ 620	$ 831
Finished goods	9,831	3,745
Total inventories	$ 10,451	$ 4,576

Property and Equipment (Details

Property and Equipment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	$ 26,028		$ 26,028		$ 24,326
Less: Accumulated depreciation	(17,958)		(17,958)		(15,665)
Property and equipment, net	8,070		8,070		8,661
Depreciation, Depletion and Amortization [Abstract]
Depreciation	1,100	$ 900	3,300	$ 2,700
Computer equipment and software
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	15,087		15,087		13,596
Furniture, fixtures and equipment
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	2,569		2,569		2,430
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	5,295		5,295		5,283
Manufacturing tools and equipment
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	2,460		2,460		2,435
Construction in process
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	$ 617		$ 617		$ 582

Investment in Sales Type Leases

Investment in Sales Type Leases (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Capital Leased Assets [Line Items]
Total	$ 1,518	$ 2,078
Sales-type and Direct Financing Leases, Lease Receivable, Undiscounted Excess Amount	779	1,190
Net Investment in Lease	739	888
Net Investment in Lease, Current	392	452
Net Investment in Lease, Noncurrent	$ 347	$ 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		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Balance Sheet Components [Abstract]
Lease revenue	$ 1,140	$ 2,228	$ 2,693	$ 5,592
Less: Cost of lease shipments	(211)	(676)	(386)	(1,533)
Gross profit	929	1,552	2,307	4,059
Sales-type Lease, Interest Income, Lease Receivable	(5)	(5)	(17)	(5)
Initial direct cost incurred	$ 63	$ 89	$ 146	$ 229

Future payments- sales type lea

Future payments- sales type leases (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Balance Sheet Components [Abstract]
2020 (remaining three months)	$ 199
2021	705
2022	476
2023	138
Total	$ 1,518	$ 2,078

Accrued Liabilities (Details)

Accrued Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Accrued Liabilities, Current [Abstract]
Payroll and related expenses	$ 7,835	$ 6,053
Accrued payables	2,359	2,674
Accrued payroll and other current liabilities	2,433	2,323
Lease financing, current portion	901	1,033
Product warranty	406	420
Customer Refund Liability, Current	1,000	631
Sales and use tax payable	435	599
Other	1,843	1,024
Total accrued payroll and other current liabilities	$ 17,212	$ 14,757

Schedule of Product Liability (

Schedule of Product Liability (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2018
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward]
Product warranty accrual, at the beginning of the period	$ 521	$ 355	$ 420
Warranty expenses accrued	98	138	320	$ 307
Product Warranty Accrual, Preexisting, Increase (Decrease)	(161)	(45)	(151)	(131)
Warranty settlements made	(52)	(47)	(183)	(151)
Product Warranty Accrual	$ 406	$ 401	$ 406	$ 401	$ 376

Balance Sheet Components Leases

Balance Sheet Components Leases (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Condensed Balance Sheet Statements, Captions [Line Items]
Other long-term assets	$ 0.8	$ 0.6	$ 2.2	$ 1.7
Minimum
Condensed Balance Sheet Statements, Captions [Line Items]
Operating lease remaining term (years)	4 months		4 months
Maximum
Condensed Balance Sheet Statements, Captions [Line Items]
Operating lease remaining term (years)	5 years		5 years

Balance Sheet Components Supple

Balance Sheet Components Supplemental Balance Sheet Information Related to Leases (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Balance Sheet Components [Abstract]
Accrued payroll and other current liabilities	$ 2,433	$ 2,323
Other long-term liabilities	2,922
Total operating lease liabilities	5,355
Other Assets, Miscellaneous, Noncurrent	$ 4,716

Balance Sheet Components Other

Balance Sheet Components Other Information Related to Leases (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Balance Sheet Components [Abstract]
Cash paid for amounts included in the measurement of lease liabilities	$ 740	$ 645	$ 2,184	$ 1,909
Right-of-use assets obtained in exchange for lease obligations	$ 17	$ 0	$ 139	$ 1,018
Weighted average remaining lease term	2 years 3 months 3 days	2 years 7 months 13 days	2 years 3 months 3 days	2 years 7 months 13 days
Weighted average discount rate	8.00%	8.00%	8.00%	8.00%

Balance Sheet Components Maturi

Balance Sheet Components Maturities of Leases (Details) $ in Thousands	Sep. 30, 2020USD ($)
Balance Sheet Components [Abstract]
2020 (remaining three months)	$ 693
2021	3,021
2022	1,376
2023	443
2024	319
Total maturities of lease liabilities	5,852
Less imputed interest	(497)
Total operating lease liabilities	$ 5,355

Convertible Senior Notes - Conv

Convertible Senior Notes - Convertible Notes and Options (Details)	1 Months Ended	2 Months Ended	3 Months Ended		9 Months Ended
	May 31, 2018USD ($)day$ / shares	Jun. 30, 2018USD ($)	Sep. 30, 2020USD ($)$ / shares	Sep. 30, 2019USD ($)	Sep. 30, 2020USD ($)$ / shares	Sep. 30, 2019USD ($)	Dec. 31, 2019USD ($)
Debt Instrument [Line Items]
Net carrying amount			$ 122,511,000		$ 122,511,000		$ 117,178,000
Total interest expense			2,368,000	$ 2,233,000	6,950,000	$ 6,524,000
Convertible Debt | Convertible Senior Notes at 1.50%
Debt Instrument [Line Items]
Aggregate principal amount	$ 143,750,000		143,750,000		143,750,000		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			(19,087,000)		(19,087,000)		(23,880,000)
Unamortized issuance costs			(2,152,000)		(2,152,000)		(2,692,000)
Net carrying amount			122,511,000		122,511,000		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		33,350,000
Debt discount effective interest rate		7.60%
Amortization of debt issuance costs		$ 4,900,000	185,000	172,000	540,000	498,000
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)		(1,136,000)
Net carrying amount			32,214,000		32,214,000		$ 32,214,000
Estimated fair value of the Notes			161,700,000		161,700,000
Denominator in closing price calculation			$ 100		$ 100
If-converted value, share price (in dollars per share) | $ / shares			$ 29.08		$ 29.08
If-converted value of the Notes					$ 129,600,000
Contractual interest expense			$ 539,000	539,000	1,617,000	1,617,000
Amortization of debt discount			1,644,000	1,521,000	4,793,000	4,414,000
Total interest expense			$ 2,368,000	$ 2,232,000	$ 6,950,000	$ 6,529,000
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	9 Months Ended
	May 31, 2018	Sep. 30, 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	Sep. 30, 2020	Dec. 31, 2019
Inventories
Unrecorded Unconditional Purchase Obligation [Line Items]
Unrecorded Unconditional Purchase Obligation	$ 7.5	$ 9.7

Stock Option Activity (Details)

Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				9 Months Ended		12 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Sep. 30, 2019	Jun. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock Issued During Period, Shares, Employee Stock Purchase Plans	0	126,046	0	61,691	126,046	61,691
Weighted Average Exercise Price (in dollars per share):
Share-based Compensation Arrangement by Share-based Payment Award, Per Share Weighted Average Price of Shares Purchased	$ 15.60		$ 29.32		$ 15.60	$ 29.32
Stock Options
Number of Options (in shares):
Beginning balance					606,327
Options granted					0
Options exercised					(184,970)
Options canceled					(1,700)
Ending balance	419,657				419,657		606,327
Weighted Average Exercise Price (in dollars per share):
Beginning balance					$ 13.41
Options granted					0
Options exercised					11.21
Options canceled					9.40
Ending balance	$ 14.40				$ 14.40		$ 13.41
Wtd avg remaining term, Outstanding					2 years 9 months		3 years 7 months 13 days
Aggregate intrinsic value, Outstanding	$ 6,159				$ 6,159		$ 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		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Equity B-S-M Fair Value Assumptions
Expected term (in years)	6 months	6 months	6 months	6 months
Volatility	54.10%	45.20%
Risk-free interest rate	0.15%	2.43%
Dividend yield	0.00%	0.00%	0.00%	0.00%
Minimum
Equity B-S-M Fair Value Assumptions
Volatility			50.00%	33.00%
Risk-free interest rate			0.15%	2.43%
Maximum
Equity B-S-M Fair Value Assumptions
Volatility			54.10%	45.20%
Risk-free interest rate			1.59%	2.51%

Summary of Restricted Stock Act

Summary of Restricted Stock Activity (Details) - Restricted Stock Units - $ / shares	3 Months Ended	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected Term (in years)	3 years
Stock Comp-other than options - Period for Recognition- Comp cost not yet rocognized		1 year 11 months 23 days
Number of Shares:
Beginning balance		1,550,646
Granted		1,395,557
Vested		(741,736)
Forfeited		(49,010)
Ending balance	2,155,457	2,155,457
Weighted Average Grant Date Fair Value per Share (in dollars per share):
Beginning balance		$ 28.94
Granted		22.28
Vested		28.03
Forfeited		26.58
Ending balance	$ 24.99	$ 24.99
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate	42.68%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate	0.20%

Stock-based Compensation and _3

Stock-based Compensation and Awards PSU Valuation Assumptions (Details) - Restricted Stock Units	3 Months Ended
	Sep. 30, 2020$ / shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant date fair value per share (in dollars per share)	$ 30.70
Expected term (in years)	3 years
Volatility	42.68%
Risk-free interest rate	0.20%
Dividend yield	0.00%

Share-based Compensaton Allocat

Share-based Compensaton Allocated to Expense Captions (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 6,679		$ 18,886	$ 17,822
Cost of Sales
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	1,042	$ 1,175	3,129	3,331
Research and Development Expense
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	1,046	1,022	3,035	2,878
Selling and Marketing Expense
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	2,037	1,808	5,858	5,286
General and Administrative Expense
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 2,554	$ 2,164	$ 6,864	$ 6,327

Narrative (Details)

Narrative (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended				9 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Sep. 30, 2019	Jun. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
ESPP plan details [Abstract]
Stock Issued During Period, Shares, Employee Stock Purchase Plans	0	126,046	0	61,691	126,046	61,691
Share-based Compensation Arrangement by Share-based Payment Award, Per Share Weighted Average Price of Shares Purchased	$ 15.60		$ 29.32		$ 15.60	$ 29.32
Restricted stock units and Performance 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	$ 42.1				$ 42.1
Stock Comp-other than options - Period for Recognition- Comp cost not yet rocognized					1 year 11 months 23 days
ESPP plan details [Abstract]
Granted					1,395,557
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	855,509				855,509
2012 Employee Stock Purchase Plan | ESPP
ESPP plan details [Abstract]
Common Stock, Capital Shares Reserved for Future Issuance	1,063,572				1,063,572
2012 Equity Incentive Plan | Restricted stock units and Performance stock units
ESPP plan details [Abstract]
Granted	145,877
Vesting period					3 years
Minimum | 2012 Equity Incentive Plan | Restricted stock units and Performance stock units
ESPP plan details [Abstract]
Shares issued, percentage of target					0.00%
Maximum | 2012 Equity Incentive Plan | Restricted stock units and Performance stock units
ESPP plan details [Abstract]
Shares issued, percentage of target					200.00%

Segments Operating Segments (De

Segments Operating Segments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Revenue
Total revenue	$ 53,815	$ 50,781	$ 141,835	$ 130,849
Cost of revenue
Total cost of revenue	17,485	18,893	51,776	52,260
Gross profit
Total gross profit	36,330	31,888	90,059	78,589
Calculation of pretax profit (loss) [Abstract]
Operating expenses	32,314	30,289	96,970	91,990
Income (loss) before income taxes	2,557	520	(11,300)	(16,188)
Product
Revenue
Total revenue	28,510	28,511	70,311	65,646
Cost of revenue
Total cost of revenue	7,139	8,204	21,213	20,450
Service
Revenue
Total revenue	25,305	22,270	71,524	65,203
Cost of revenue
Total cost of revenue	$ 10,346	$ 10,689	$ 30,563	$ 31,810

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Aug. 18, 2020
Income Tax Disclosure [Abstract]
Income tax expense (benefit)	$ 1,604	$ (222)	$ 1,523	$ (106)
Business Acquisition [Line Items]
Decrease in net deferred tax assets valuation allowance	2,100
Minimum
Unusual or Infrequent Item, or Both [Line Items]
CARES Act, payroll tax deferral	1,500		1,500
Maximum
Unusual or Infrequent Item, or Both [Line Items]
CARES Act, payroll tax deferral	$ 2,000		$ 2,000
EASE Applications
Business Acquisition [Line Items]
Business acquisition, deferred tax liabilities					$ 2,100

Business Acquisition - Identifi

Business Acquisition - Identifiable Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	Aug. 18, 2020	Sep. 30, 2020	Dec. 31, 2019
Intangibles assets
Goodwill		$ 69,168	$ 49,246
Customer relationships
Current Assets
Weighted Average Useful Life		8 years
Developed technology
Current Assets
Weighted Average Useful Life		3 years 10 months 24 days
Trademarks
Current Assets
Weighted Average Useful Life		3 years
Backlog
Current Assets
Weighted Average Useful Life		3 years 4 months 24 days
EASE Applications
Current Assets
Accounts receivable, net	$ 444
Prepaid expenses and other current assets	18
Total current assets	462
Intangibles assets
Goodwill	19,922
Total assets	29,624
Current liabilities
Accounts payable	6
Accrued payroll and other current liabilities	22
Deferred revenue, current	1,011
Total current liabilities	1,039
Deferred revenue, long term	149
Other long-term liabilities	4,218
Total liabilities	5,406
Net assets acquired	$ 24,218
EASE Applications | Customer relationships
Current Assets
Weighted Average Useful Life	8 years
Intangibles assets
Intangible assets	$ 5,430
EASE Applications | Developed technology
Current Assets
Weighted Average Useful Life	3 years
Intangibles assets
Intangible assets	$ 2,310
EASE Applications | Trademarks
Current Assets
Weighted Average Useful Life	3 years
Intangibles assets
Intangible assets	$ 660
EASE Applications | Backlog
Current Assets
Weighted Average Useful Life	4 years
Intangibles assets
Intangible assets	$ 840

Business Acquisition - Narrativ

Business Acquisition - Narrative (Details) - USD ($) $ in Thousands	Aug. 18, 2020	Sep. 30, 2020	Sep. 30, 2020	Sep. 30, 2019
Business Acquisition [Line Items]
Payments to acquire business, net of cash acquired			$ 24,218	$ 0
EASE Applications
Business Acquisition [Line Items]
Payments to acquire business, net of cash acquired	$ 24,200
Cash acquired	300
Contingent consideration, maximum	2,500
Contingent consideration, fair value	2,200
Acquisition-related costs	$ 500
Employee retention plan, potential additional compensation, term	2 years
Employee retention plan, potential additional compensation, term	$ 5,000
Employee retention bonus		$ 400