Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Mar. 31, 2017 | Apr. 28, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | ACCURAY INC | |
Entity Central Index Key | 1,138,723 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --06-30 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 83,000,966 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2017 | Jun. 30, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 60,170 | $ 119,771 |
Short-term investments | 23,906 | 47,239 |
Restricted cash | 1,154 | 891 |
Accounts receivable, net of allowance for doubtful accounts of $747 and $826 as of March 31, 2017 and June 30, 2016, respectively | 87,091 | 56,810 |
Inventories | 116,573 | 115,987 |
Prepaid expenses and other current assets | 17,704 | 16,098 |
Deferred cost of revenue | 3,725 | 4,884 |
Total current assets | 310,323 | 361,680 |
Property and equipment, net | 23,353 | 27,878 |
Goodwill | 57,742 | 57,848 |
Intangible assets, net | 1,646 | 7,611 |
Deferred cost of revenue | 666 | 1,996 |
Restricted cash | 13,085 | 1,471 |
Other assets | 10,032 | 10,549 |
Total assets | 416,847 | 469,033 |
Current liabilities: | ||
Accounts payable | 23,633 | 15,229 |
Accrued compensation | 24,224 | 18,725 |
Other accrued liabilities | 18,551 | 22,184 |
Short-term debt | 115,702 | 39,900 |
Customer advances | 18,853 | 22,123 |
Deferred revenue | 95,250 | 92,051 |
Total current liabilities | 296,213 | 210,212 |
Long-term liabilities: | ||
Long-term other liabilities | 10,542 | 10,984 |
Deferred revenue | 10,301 | 17,665 |
Long-term debt | 54,335 | 170,512 |
Total liabilities | 371,391 | 409,373 |
Commitments and contingencies (Note 6) | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value; authorized: 5,000,000 shares; no shares issued and outstanding | ||
Common stock, $0.001 par value; authorized: 200,000,000 shares as of March 31, 2017 and June 30, 2016, respectively; issued and outstanding: 82,999,966 and 81,378,208 shares at March 31, 2017 and June 30, 2016, respectively | 83 | 81 |
Additional paid-in-capital | 492,311 | 481,346 |
Accumulated other comprehensive loss | (1,807) | (960) |
Accumulated deficit | (445,131) | (420,807) |
Total stockholders' equity | 45,456 | 59,660 |
Total liabilities and stockholders' equity | $ 416,847 | $ 469,033 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2017 | Jun. 30, 2016 |
Condensed Consolidated Balance Sheets | ||
Accounts receivable, allowance for doubtful accounts (in dollars) | $ 747 | $ 826 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized shares | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized shares | 200,000,000 | 200,000,000 |
Common stock, issued shares | 82,999,966 | 81,378,208 |
Common stock, outstanding shares | 82,999,966 | 81,378,208 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Net revenue: | ||||
Products | $ 48,032 | $ 53,740 | $ 119,029 | $ 149,494 |
Services | 49,280 | 51,544 | 152,291 | 154,333 |
Total net revenue | 97,312 | 105,284 | 271,320 | 303,827 |
Cost of revenue: | ||||
Cost of products | 29,574 | 29,622 | 75,895 | 85,356 |
Cost of services | 32,313 | 30,718 | 97,269 | 97,058 |
Total cost of revenue | 61,887 | 60,340 | 173,164 | 182,414 |
Gross profit | 35,425 | 44,944 | 98,156 | 121,413 |
Operating expenses: | ||||
Research and development | 12,484 | 13,270 | 36,657 | 42,497 |
Selling and marketing | 13,025 | 12,516 | 41,247 | 41,009 |
General and administrative | 11,184 | 13,716 | 32,890 | 39,820 |
Total operating expenses | 36,693 | 39,502 | 110,794 | 123,326 |
Income (loss) from operations | (1,268) | 5,442 | (12,638) | (1,913) |
Other expense, net | (2,919) | (3,963) | (11,044) | (14,124) |
Income (loss) before provision for income taxes | (4,187) | 1,479 | (23,682) | (16,037) |
Provision for income taxes | 842 | 723 | 642 | 2,260 |
Net income (loss) | $ (5,029) | $ 756 | $ (24,324) | $ (18,297) |
Net income (loss) per share | ||||
Net income (loss) per share - basic (in dollars per share) | $ (0.06) | $ 0.01 | $ (0.30) | $ (0.23) |
Net income (loss) per share - diluted (in dollars per share) | $ (0.06) | $ 0.01 | $ (0.30) | $ (0.23) |
Weighted average common shares used in computing net income (loss) per share: | ||||
Basic (in shares) | 82,913 | 80,860 | 82,268 | 80,320 |
Diluted (in shares) | 82,913 | 82,071 | 82,268 | 80,320 |
Net income (loss) | $ (5,029) | $ 756 | $ (24,324) | $ (18,297) |
Foreign currency translation adjustment | 435 | 796 | (771) | 69 |
Unrealized loss on investments, net of tax | (6) | 149 | (76) | 59 |
Comprehensive income (loss) | $ (4,600) | $ 1,701 | $ (25,171) | $ (18,169) |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities | ||
Net loss | $ (24,324) | $ (18,297) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 13,848 | 13,644 |
Share-based compensation | 9,985 | 9,446 |
Amortization of debt issuance costs | 1,165 | 1,279 |
Amortization and accretion of discount and premium on investments | 70 | 731 |
Accretion of interest on debt | 2,117 | 5,155 |
(Recovery of) provision for bad debt, net | (64) | 162 |
Provision for write-down of inventories | 1,131 | 1,472 |
Loss on disposal of property and equipment | 4 | 11 |
Loss on extinguishment of debt | 965 | |
Changes in assets and liabilities: | ||
Accounts receivable | (30,649) | (10,294) |
Inventories | (2,386) | (11,335) |
Prepaid expenses and other assets | (1,439) | (3,993) |
Deferred cost of revenue | 2,474 | (1,941) |
Accounts payable | 8,249 | 8,724 |
Accrued liabilities | 1,578 | 1,289 |
Customer advances | (2,914) | 268 |
Deferred revenues | (2,907) | 13,808 |
Net cash (used in) provided by operating activities | (24,062) | 11,094 |
Cash flows from investing activities | ||
Purchases of property and equipment, net | (3,619) | (5,885) |
Purchases of investments | (14,992) | (52,712) |
Sales and maturities of investments | 38,179 | 45,695 |
Net cash provided by (used in) investing activities | 19,568 | (12,902) |
Cash flows from financing activities | ||
Proceeds from employee stock plans | 3,075 | 2,950 |
Taxes paid related to net share settlement of equity awards | (841) | (3,045) |
Payments made to note and loan holders | (43,658) | (65,531) |
Proceeds from debt, net of costs | 64,632 | |
Net cash used in financing activities | (41,424) | (994) |
Effect of exchange rate changes on cash and cash equivalents | (1,806) | (244) |
Net decrease in cash, cash equivalents and restricted cash | (47,724) | (3,046) |
Cash, cash equivalents and restricted cash at beginning of period | 122,133 | 84,709 |
Cash, cash equivalents and restricted cash at end of period | $ 74,409 | $ 81,663 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Mar. 31, 2017 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 1. Summary of Significant Accounting Policies Description of Business Accuray Incorporated (together with its subsidiaries, the “Company” or “Accuray”) is incorporated in Delaware and has its principal place of business in Sunnyvale, California. The Company designs, develops and sells advanced radiosurgery and radiation therapy systems for the treatment of tumors throughout the body. The Company has offices in the United States, Switzerland, China, Hong Kong and Japan and conducts its business worldwide. Basis of Presentation and Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant inter-company transactions and balances have been eliminated in consolidation. The accompanying condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”), pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and note disclosures have been condensed or omitted pursuant to such rules and regulations. The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair presentation of the periods presented. Certain amounts in the prior year’s condensed consolidated balance sheet have been reclassified to conform to the current period’s presentation. These reclassifications had no impact on previously reported condensed consolidated cash flows or statements of operations. The results for the three and nine months ended March 31, 2017 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2017, or for any other future interim period or fiscal year. These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and accompanying notes for the fiscal year ended June 30, 2016 included in the Company’s Annual Report on Form 10-K filed with the SEC on August 24, 2016. The Company’s significant accounting policies are described in Note 2 to those audited consolidated financial statements and there have been no subsequent material changes to such policies. Recent Accounting Standard Update Not Yet Effective In March 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) No. 2017-07, Compensation-Retirement Benefits (Topic 715)-Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This guidance revises the presentation of employer-sponsored defined benefit pension and other postretirement plans for the net periodic benefit cost in the statement of operations and requires that the service cost component of net periodic benefit be presented in the same income statement line items as other employee compensation costs for services rendered during the period. The other components of the net benefit costs are required to be presented in the statement of operations separately from the service cost component and outside the subtotal of income from operations. This guidance allows only the service cost component of net periodic benefit costs to be eligible for capitalization. The guidance will be effective for the Company in the first quarter of its fiscal year 2019 and early adoption is permitted as of the beginning of an annual reporting period. The Company has not yet determined whether it will elect early adoption and is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other Topics (Topic 350)-Simplifying the Test for Goodwill Impairment. This guidance eliminates the requirement to calculate the implied fair value of goodwill of a reporting unit by determining the fair value of its assets and liabilities (including unrecognized assets and liabilities) to measure a goodwill impairment charge. Instead, an entity will record an impairment charge based on the excess of the reporting unit’s carrying amount over its fair value. The ASU will be effective for the Company in the first quarter of its fiscal year 2021 on a prospective basis and earlier adoption is permitted for goodwill impairment tests performed on testing dates after January 1, 2017. The Company has not yet determined whether it will elect early adoption and is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which clarifies the presentation and classification of certain cash receipts and cash payments in the statement of cash flows. This ASU will be effective for the Company in the first quarter of its fiscal year 2019 and early adoption is permitted. The Company has not yet determined whether it will elect early adoption and is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In June 2016, the FASB issued ASU No. 2016-13 Measurement of Credit Losses on Financial Instruments (ASU 2016-13). ASU 2016-13 requires measurement and recognition of expected credit losses for financial assets held. This ASU will be effective for the Company in the first quarter of its fiscal year 2021 and must be adopted using a modified retrospective approach, with certain exceptions. Early adoption is permitted beginning in the first quarter of the Company’s fiscal year 2020. The Company is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718) . The new guidance simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. In addition, the guidance provides an option to recognize forfeitures as they occur versus estimating them at the time of grant. This ASU will be effective for the Company in the first quarter of its fiscal year 2018 and early adoption is permitted. The Company is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . Under the new guidance, a lessee will be required to recognize assets and liabilities for all leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as finance or operating lease. This ASU will be effective for the Company in the first quarter of its fiscal year 2020 and early adoption is permitted. The ASU requires adoption based upon a modified retrospective transition approach. Company has not yet selected a transition method, has not yet determined whether it will elect early adoption and is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities (ASU 2016-01). ASU 2016-01 changes accounting for equity investments, financial liabilities under the fair value option and the presentation and disclosure requirements for financial instruments. In addition, it clarified guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. This ASU will be effective for the Company in the first quarter of its fiscal year 2019 and must be adopted using a modified retrospective approach, with certain exceptions. Early adoption is permitted for certain provisions. The Company has not yet determined whether it will elect early adoption and is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers: Topic 606 (ASU 2014-09), to supersede nearly all existing revenue recognition guidance under GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing GAAP including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. ASU 2014-09 is required to be adopted, using either of two methods: (i) retrospective to each prior reporting period presented with the option to elect certain practical expedients as defined within ASU 2014-09; or (ii) retrospective with the cumulative effect of initially applying ASU 2014-09 recognized at the date of initial application and providing certain additional disclosures. In August 2015, the FASB approved a one year deferral of the effective period of ASU 2014-09. The standard will be effective for the Company in the first quarter of its fiscal year 2019, but early adoption is permitted starting in the first quarter of fiscal year 2018. The FASB issued supplemental adoption guidance and clarification to ASU 2014-09 in 2016 and 2017. The Company intends to adopt the new standard in the first quarter of fiscal year 2019 by recognizing the cumulative effect of the new standard as an increase to the opening balance of retained earnings. Based upon the Company’s preliminary assessment, certain portions of its product revenue will be accelerated to reflect consideration upon delivery and an element of installation will be deferred until performed. Revenue policies for indirect sales and service revenues are expected to be unchanged under the new guidance. The Company also expects to capitalize incremental contract acquisition costs, such as sales commissions, and amortize over the economic life of its product or contractual relationship with the customer. The Company’s current practice is to defer sales comissions until revenue is recognized. The Company currently does not expect the application of this guidance to have a significant impact on its consolidated financial statements; however, the Company’s assessment may change as it continues its evaluation and analysis of this ASU. Accounting Standard Update Recently Adopted In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash , which provides amendments to current guidance to address the classification and presentation of changes in restricted cash in the statement of cash flows. The Company early adopted this ASU and retrospectively applied the change to the statement of cash flows for the nine months ended March 31, 2016. The Company disclosed its restricted cash on its condensed consolidated balance sheets for the years presented. The adoption of this standard did not have a significant impact on the Company’s condensed consolidated financial statements and related disclosures. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures at the date of the financial statements. Key estimates and assumptions made by the Company relate to revenue recognition, assessment of recoverability of goodwill and intangible assets, valuation of inventories, share-based compensation expense, income taxes, allowance for doubtful accounts, loss contingencies and corporate bonus expenses. Actual results could differ materially from those estimates. Concentration of Credit and Other Risks The Company’s cash, cash equivalents and investments are deposited with several major financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. The Company has not experienced any losses in such accounts and does not believe that it is exposed to any significant risk of loss on these balances. For the three months ended March 31, 2017 and 2016, there was one customer that represented 13% of total net revenue and no customers that represented 10% or more of total net revenue, respectively. For the nine months ended March 31, 2017 and 2016, there were no customers that represented more than 10% of total net revenue, respectively. One customer accounted for 25% and 18% of the Company’s total accounts receivable as of March 31, 2017 and June 30, 2016, respectively. Accounts receivable are typically not collateralized. The Company performs ongoing credit evaluations of its customers and maintains reserves for potential credit losses. Accounts receivable are deemed past due in accordance with the contractual terms of the agreement pursuant to which the receivables are generated. Accounts receivable balances are charged against the allowance for doubtful accounts once collection efforts are unsuccessful. Single source suppliers presently provide the Company with several components. In most cases, if a supplier was unable to deliver these components, the Company believes that it would be able to find other sources at comparable prices for these components subject to any regulatory qualifications, if required. Revenue Recognition The Company earns revenue from the sale of products and related services. The Company records revenues net of any value added or sales tax. For arrangements with multiple elements, the Company allocates arrangement fees to products and services based upon Vendor Specific Objective Evidence (VSOE) of fair value of the respective elements, Third-Party Evidence (TPE), or Best Estimate of Selling Price (BESP), using the relative selling price method. Product and Service Revenue The majority of product revenue is generated from sales of CyberKnife and TomoTherapy Systems. If the Company is responsible for installation, the Company recognizes revenue after installation and acceptance of the system. Otherwise, revenue is recognized upon delivery, assuming all other revenue recognition criteria are met. The Company offers systems with post-contract customer support (PCS), installation services, training and professional services. PCS includes planned and corrective maintenance services, software updates, bug fixes, as well as call-center support. Service revenue is generated primarily from PCS (warranty period services and post warranty services), installation services, training, parts and upgrades that are sold under service contracts and professional services. PCS revenue is deferred and recognized over the service period. Installation service revenue is recognized concurrently with system revenue. Training and professional service revenues that are not deemed essential to the functionality of the systems are recognized as such services are performed. Costs associated with service revenue are expensed when incurred, except when those costs are related to parts or system upgrades where revenue recognition has been deferred. In those cases, the costs are deferred and recognized over the period of revenue recognition. Net Income (Loss) Per Common Share Basic and diluted net income (loss) per share is computed by dividing net income (loss) attributable to stockholders by the weighted average number of common shares outstanding during the period. A reconciliation of the numerator and denominator used in the calculation of basic and diluted net income (loss) per common share follows (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Numerator: Net income (loss) used to compute basic and diluted net income (loss) per share $ ) $ $ ) $ ) Denominator: Weighted average shares used to compute basic net income (loss) per share Weighted average effect of dilutive stock options — — — Weighted average effect of dilutive RSUs, PSUs and MSUs — — — Weighted average effect of 3.50% Series A convertible notes — — — Weighted average shares used to compute diluted net income (loss) per share The potentially dilutive shares of the Company’s common stock resulting from the assumed exercise of outstanding stock options, the vesting of Restricted Stock Units (RSU), Market Stock Units (MSU) and Performance Stock Units (PSU), and the purchase of shares under the Employee Stock Purchase Program (ESPP), as determined under the treasury stock method, are excluded from the computation of diluted net loss per share because their effect would have been anti-dilutive. Additionally, the 3.75% Convertible Senior Notes (the “3.75% Convertible Notes”), the 3.50% Convertible Senior Notes due February 1, 2018 (the “3.50% Convertible Notes”), the 3.50% Series A Convertible Notes (the “3.50% Series A Convertible Notes”) due February 1, 2018 (together, the “Convertible Notes”) are included in the calculation of diluted net income per share only if their inclusion is dilutive. For the three months ended March 31, 2016, the potentially dilutive shares issuable upon the conversion of the 3.50% Series A Convertible Notes were included in the calculation of the diluted net income per share, while the dilutive shares issuable upon the conversion of the 3.50% Convertible Notes were excluded from the calculation of diluted net income per share as their inclusion would have been anti-dilutive. The following table sets forth all potentially dilutive securities excluded from the computation in the table above because their effect would have been anti-dilutive (in thousands): As of March 31, 2017 2016 Stock options RSUs, PSUs and MSUs 3.50% Convertible Notes 3.50% Series A Convertible Notes — — Outstanding Convertible Notes—Diluted Share Impact The 3.50% Series A Convertible Notes have an optional physical (share), cash or combination settlement feature and contain certain conditional conversion features. Due to the optional cash settlement feature and management’s intent to settle the principal amount thereof in cash, the conversion shares underlying the outstanding principal amount of the 3.50% Series A Convertible Notes, totaling approximately 13.2 million shares were not included in the potentially diluted share count table above. The zero potentially dilutive shares of the 3.50% Series A Convertible Notes as of March 31, 2017, included in the table above are the result of the lower average share price, which was below the conversion price and management’s intent to settle the principal amount thereof in cash. The number of premium shares included in the Company’s diluted share count will vary with fluctuations in the Company’s share price. Higher actual share prices result in a greater number of premium shares. The 3.75% Convertible Notes were fully settled in cash during January and August of 2016 as further discussed in Note 8. As of March 31, 2016, approximately 10.6 million shares related to the 3.75% Convertible Notes were excluded from the potentially dilutive share count table above due to the optional cash settlement feature and management’s intent to settle the principal amount thereof in cash. In addition, there were no premium shares associated with the 3.75% Convertible Notes as the Company’s average share price did not exceed the conversion price as of March 31, 2016. Segment Information The Company has one operating and reporting segment (oncology systems group), which develops, manufactures and markets proprietary medical devices used in radiation therapy and radiosurgery for the treatment of cancer patients. The Company’s Chief Executive Officer, its Chief Operating Decision Maker, reviews financial information presented on a consolidated basis for purposes of making operating decisions and assessing financial performance. The Company does not assess the performance of its individual product lines on measures of profit or loss, or asset based metrics. Therefore, the information below is presented only for revenues and long-lived tangible assets by geographic areas. Revenue by geographic region is based on the shipping addresses of the Company’s customers. The following summarizes revenue by geographic region (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Americas $ $ $ $ Europe, Middle East, India and Africa Asia-Pacific Japan Total $ $ $ $ Information regarding geographic areas in which the Company has long lived tangible assets is as follows (in thousands): March 31, June 30, 2017 2016 Americas $ $ Europe, Middle East, India and Africa Asia-Pacific Japan Total $ $ |
Balance Sheet Components
Balance Sheet Components | 9 Months Ended |
Mar. 31, 2017 | |
Balance Sheet Components | |
Balance Sheet Components | 2. Balance Sheet Components Financing receivables A financing receivable is a contractual right to receive money, on demand or on fixed or determinable dates, that is recognized as an asset in the Company’s balance sheet. The Company’s financing receivables, consisting of its accounts receivable with contractual maturities of more than one year and capital leases, totaled $5.5 million and $7.6 million at March 31, 2017 and June 30, 2016, respectively, and are included in Other Assets in the condensed consolidated balance sheets. Of the $5.5 million in financing receivables at March 31, 2017, $3.0 million is related to sales-type leases with customers while the remaining $2.5 million is related to contractual maturities of more than one year. Of the $7.6 million in financing receivables at June 30, 2016, $3.5 million is related to sales-type leases with customers while the remaining $4.1 million is related to contractual maturities of more than one year. Due to the homogenous nature of the leasing transactions, the Company manages them on an aggregate basis when assessing and monitoring credit risk. The Company evaluates the credit quality of an obligor at lease inception and monitors credit quality over the term of the underlying transactions. The Company performs a credit analysis for all new customers and reviews payment history, current order backlog, financial performance of the customers and other variables that augment or mitigate the inherent credit risk of a particular transaction. Such variables include the underlying value and liquidity of the collateral, the essential use of the equipment, the term of the lease and the inclusion of credit enhancements, such as guarantees, letters of credit or security deposits. The Company classifies accounts as high risk when it considers the financing receivable to be impaired or when management believes there is a significant near-term risk of non-payments. As of March 31, 2017, the sales-type lease portion of the financing receivables was rated at a moderate risk. The Company performed an assessment of the allowance for credit losses related to its financing receivables as of March 31, 2017 and June 30, 2016. Based upon such assessment, the Company did not record an allowance for credit losses related to such financing receivables as of March 31, 2017 and June 30, 2016, respectively. A summary of the Company’s financing receivables is presented as follows (in thousands): Financed Lease Service Contracts March 31, 2017 Receivables and Other Total Gross $ $ $ Residual value — — — Unearned income ) — ) Allowance for credit loss — — — Total, net $ $ $ Reported as: Current $ $ $ Non-current Total, net $ $ $ Financed Lease Service Contracts June 30, 2016 Receivables and Other Total Gross $ $ $ Residual value — — — Unearned income ) — ) Allowance for credit loss — — — Total, net $ $ $ Reported as: Current $ $ $ Non-current Total, net $ $ $ Actual cash collections may differ from the contracted maturities due to early customer buyouts, refinancing, or defaults. Future minimum lease payments to be received as of March 31, 2017 are presented as follows (in thousands): Year Ending June 30, Amount 2017 (remaining 3 months) $ 2018 2019 2020 2021 2022 Total $ Inventories Inventories consisted of the following (in thousands): March 31, June 30, 2017 2016 Raw materials $ $ Work-in-process Finished goods Inventories $ $ Property and equipment, net Property and equipment, net consisted of the following (in thousands): March 31, June 30, 2017 2016 Furniture and fixtures $ $ Computer and office equipment Software Leasehold improvements Machinery and equipment Construction in progress Less: Accumulated depreciation ) ) Property and equipment, net $ $ Depreciation expense related to property and equipment for the three and nine months ended March 31, 2017 was $2.6 million and $7.9 million, respectively. Depreciation expense related to property and equipment for the three and nine months ended March 31, 2016 was $2.6 million and $7.7 million, respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | 3. Goodwill and Intangible Assets Goodwill Activity related to goodwill consisted of the following (in thousands): Nine Months Year Ended Ended March 31, June 30, 2017 2016 Balance at the beginning of the period $ $ Currency translation ) ) Balance at the end of the period $ $ In the second quarter of fiscal 2017, the Company performed its annual goodwill impairment test. Based on this analysis, the Company determined that there was no impairment to goodwill. The Company will continue to monitor its recorded goodwill for indicators of impairment. Intangible Assets The Company’s unamortized intangible assets associated with completed acquisitions at March 31, 2017 and June 30, 2016 are as follows (in thousands): March 31, 2017 June 30, 2016 Gross Gross Carrying Accumulated Net Carrying Accumulated Net Useful Lives Amount Amortization Amount Amount Amortization Amount (in years) Developed technology 5 — 6 $ $ ) $ $ $ ) $ The Company did not identify any triggering events that would indicate potential impairment of its definite-lived intangible and long-lived assets as of March 31, 2017 and June 30, 2016. Amortization expense related to intangible assets for the three and nine months ended March 31, 2017 was $2.0 million and $6.0 million, respectively. Amortization expense related to intangible assets for the three and nine months ended March 31, 2016 was $2.0 million and $6.0 million, respectively. The estimated future amortization expense of purchased intangible assets as of March 31, 2017 is as follows (in thousands): Year Ending June 30, Amount 2017 (remaining 3 months) $ |
Foreign Exchange Instruments
Foreign Exchange Instruments | 9 Months Ended |
Mar. 31, 2017 | |
Foreign Exchange Instruments | |
Foreign Exchange Instruments | 4. Foreign Exchange Instruments The Company utilizes foreign currency forward contracts with well-known financial institutions to manage its exposure to fluctuations in foreign currency exchange rates on certain intercompany balances and foreign currency denominated cash and customer receivables. The Company does not use derivative financial instruments for speculative or trading purposes. These forward contracts are not designated as hedging instruments for accounting purposes. Principal hedged currencies include the Euro, Japanese Yen, Swiss Franc, and U.S. Dollar. The periods of these forward contracts range up to approximately three months and the notional amounts are intended to be consistent with changes in the underlying exposures. The Company intends to exchange foreign currencies for U.S. Dollars at maturity. There were no outstanding foreign currency forward contracts at the end of March 31, 2017 and June 30, 2016. The following table shows the net effect of foreign currency expenses and forward contracts not designated as hedging instruments and foreign currency transactions gains and losses, which were included in “Other expense, net” on the condensed consolidated statements of operations in three and nine months ended March 31, 2017 and 2016 is as follows (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Foreign currency exchange gain (loss) on foreign contracts $ $ $ ) $ ) Foreign currency transactions gain (loss) ) ) |
Financial Instruments
Financial Instruments | 9 Months Ended |
Mar. 31, 2017 | |
Financial Instruments | |
Financial Instruments | 5. Financial Instruments The Company considers all highly liquid investments held at major banks, certificates of deposit and other securities with original maturities of three months or less to be cash equivalents. The Company classifies all of its investments as available-for-sale at the time of purchase because management intends that these investments are available for current operations and includes these investments on its balance sheet as short-term investments. Investments with original maturities longer than three months include commercial paper, U.S. agency securities, non-U.S. government securities and investment-grade corporate debt securities. Investments classified as available-for-sale are recorded at fair market value with the related unrealized gains and losses included in accumulated other comprehensive income (loss), a component of stockholders’ equity. Realized gains and losses are recorded based on specific identification of each security’s cost basis. The Company defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy contains three levels of inputs that may be used to measure fair value, as follows: Level 1— Unadjusted quoted prices that are available in active markets for the identical assets or liabilities at the measurement date. Level 2— Other observable inputs available at the measurement date, other than quoted prices included in Level 1, either directly or indirectly, including: · Quoted prices for similar assets or liabilities in active markets; · Quoted prices for identical or similar assets in non-active markets; · Inputs other than quoted prices that are observable for the asset or liability; and · Inputs that are derived principally from or corroborated by other observable market data. Level 3— Unobservable inputs that cannot be corroborated by observable market data and require the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions. The following tables summarize the amortized cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category for cash, cash equivalents and short-term investments (in thousands): March 31, 2017 Estimated Fair Value Gross Gross Cash and Amortized Unrealized Unrealized Cash Short-term Cost Gains Losses Equivalents Investments Cash $ $ — $ — $ $ — Level 1 Money market funds — — — Level 2 U.S. government agency securities — ) — Total $ $ — $ ) $ $ June 30, 2016 Estimated Fair Value Gross Gross Cash and Amortized Unrealized Unrealized Cash Short-term Cost Gains Losses Equivalents Investments Cash $ $ — $ — $ $ — Level 1 Money market funds — — — — — — Level 2 Commercial paper — — U.S. government agency securities ) — U. S. treasury securities — — Municipal debt securities — — — Corporate debt securities — ) — ) Total $ $ $ ) $ $ Certain investments in the table above are classified as having Level 2 inputs because quoted prices in an active market are not readily accessible for those specific financial assets, or the Company may have relied on alternative pricing methods that do not rely exclusively on quoted prices to determine the fair value of the investments. The Company had investments that were in an unrealized loss position as of March 31, 2017. The Company determined that (i) it does not have the intent to sell any of these investments and (ii) it is not likely that it will be required to sell any of these investments before recovery of the entire amortized cost basis. The Company reviews its investments quarterly to identify and evaluate investments that have an indication of possible impairment. As of March 31, 2017, the Company anticipates that it will recover the entire carrying value of such investments and has determined that no other-than-temporary impairments associated with credit losses were required to be recognized during the three and nine months ended March 31, 2017. 2 Contractual maturities of available-for-sale securities at March 31, 2017 were as follows (in thousands): March 31, 2017 Amortized Estimated Cost Fair Value Due in 1 year or less $ $ Due in 1-2 years $ $ The following table summarizes the available-for-sale debt securities that were in a continuous unrealized loss position, but were not deemed to be other-than-temporarily impaired (in thousands): Less Than 12 Months 12 Months or Greater Total Gross Gross Gross Unrealized Estimated Unrealized Estimated Unrealized Estimated Losses Fair Value Losses Fair Value Losses Fair Value March 31, 2017 Debt Securities: U. S. government agency securities $ ) $ $ ) $ $ ) $ Total $ ) $ $ ) $ $ ) $ June 30, 2016 Debt Securities: Corporate debt securities $ ) $ $ ) $ $ ) $ U. S. government agency securities — — ) ) Total $ ) $ $ ) $ $ ) $ The Company held a total of 8 positions as of March 31, 2017 and 11 positions as of June 30, 2016 that were in an unrealized loss position. Based on the Company’s review of these securities, the Company believes it had no other-than-temporary impairments on these securities as of March 31, 2017 and June 30, 2016 because it does not intend to sell these securities and believes it is not more likely than not that it will be required to sell these securities before the recovery of their amortized cost basis. Gross realized gains and gross realized losses were insignificant for the three and nine months ended March 31, 2017 and the year ended June 30, 2016. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies | |
Commitments and Contingencies | 6. Commitments and Contingencies Operating Lease Agreements The Company leases office and manufacturing space under non-cancelable operating leases with various expiration dates through December 2025. In October 2016, the Company signed a lease extension on its Madison, Wisconsin facility through 2025, which would have expired in 2018. Accordingly, the Company’s lease obligations increased from $39.9 million as of June 30, 2016 to $48.3 million as of March 31, 2017. Future minimum lease payments under non-cancelable operating lease agreements as of March 31, 2017 are as follows (in thousands): Operating Year Ending June 30, Leases 2017 (remaining 3 months) $ 2018 2019 2020 2021 Thereafter Total $ The Company’s contractual obligations were presented in the Annual Report on Form 10-K for the previous annual reporting period ended June 30, 2016. As discussed in Note 8, in August 2016, the Company settled the remaining approximately $36.6 million in aggregate principal amount of the 3.75% Convertible Senior Notes and accrued interest for $37.3 million in cash. In November 2016, the Company repaid $5.0 million of its Secured Loan. Except for the change in lease obligations presented in the above table and a reduction of the Company’s Notes and Secured Loan, there has been no significant change outside of the ordinary course of business in those obligations during the three and nine months ended March 31, 2017. Litigation From time to time, the Company is involved in legal proceedings arising in the ordinary course of its business. The Company records a provision for a loss when it believes that it is both probable that a loss has been incurred and the amount can be reasonably estimated. Currently, management believes the Company does not have any probable and reasonably estimable losses related to any current legal proceedings and claims. Although occasional adverse decisions or settlements may occur, management does not believe that an adverse determination with respect to any of these claims would individually or in the aggregate materially and adversely affect the Company’s financial condition or operating results. Litigation is inherently unpredictable and is subject to significant uncertainties, some of which are beyond the Company’s control. Should any of these estimates and assumptions change or prove to have been incorrect, the Company could incur significant charges related to legal matters that could have a material impact on its results of operations, financial position and cash flows. Software License Indemnity Under the terms of the Company’s software license agreements with its customers, the Company agrees that in the event the software sold infringes upon any patent, copyright, trademark, or any other proprietary right of a third-party, it will indemnify its customer licensees against any loss, expense, or liability from any damages that may be awarded against its customer. The Company includes this infringement indemnification in all of its software license agreements and selected managed services arrangements. In the event the customer cannot use the software or service due to infringement and the Company cannot obtain the right to use, replace or modify the license or service in a commercially feasible manner so that it no longer infringes, then the Company may terminate the license and provide the customer a refund of the fees paid by the customer for the infringing license or service. The Company has not recorded any liability associated with this indemnification, as it is not aware of any pending or threatened actions that represent probable losses as of March 31, 2017. |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Mar. 31, 2017 | |
Share-Based Compensation | |
Share-Based Compensation | 7. Share-Based Compensation The following table summarizes the share-based compensation charges included in the Company’s condensed consolidated statements of operations and comprehensive loss (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Cost of revenue $ $ $ $ Research and development Selling and marketing General and administrative $ $ $ $ |
Debt
Debt | 9 Months Ended |
Mar. 31, 2017 | |
Debt | |
Debt | 8. Debt First Lien Senior Secured Term Loan due January 2021 (Secured Loan) In January 2016, the Company closed a $70.0 million first lien senior secured debt financing agreement (as amended, the “Secured Loan”) with Cerberus Business Finance, LLC, as collateral and administrative agent. As required by the terms of the financing, upon the closing of the financing, the Company used a portion of the net proceeds from the financing to repurchase approximately $63.4 million in aggregate principal amount of the 3.75% Convertible Senior Notes. The Secured Loan is repayable in consecutive quarterly installments of $875,000 with the final payment due on the maturity date. The Secured Loan matures on the earlier of: (i) January 11, 2021 and (ii) the date that is 120 days prior to the scheduled maturity date of the 3.5% Convertible Senior Notes maturing February 1, 2018 unless the Company has set aside specifically identifiable funds raised from new common equity or new debt equal to the then-outstanding principal amount of the 3.5% Convertible Senior Notes. The Company may, at its election, repay the Secured Loan at any time and if so, the Company will be required to pay a prepayment premium of 2% of the outstanding amount if the Secured Loan is repaid or accelerated within the first year and 1% of the outstanding amount if the Secured Loan is repaid or accelerated within the second year. The Secured Loan is secured by first-priority liens on substantially all the assets of the Company. Interest under the Secured Loan is payable monthly at a variable rate per annum equal to, at the Company’s option, (i) the LIBOR Rate for one month plus an applicable margin of 7.00% (subject to a LIBOR Rate floor of 1.00% per annum), or (ii) a Reference Rate, which is the higher of 1) 3.25%, 2) Federal Funds Rate plus 0.5%, 3) the LIBOR rate for 1 month plus 1%, and 4) the US Prime Rate as published in the Wall Street Journal, plus an applicable margin of 4.75% per annum. As part of the amendment in March 2017, discussed further below, the applicable margins for the LIBOR and Reference Rate increased to 7.50% and 5.25%, respectively, and these margins will remain in effect until certain specified conditions are met. Under the terms of this Secured Loan, the Company must comply with certain customary financial and non-financial covenants, including covenants for secured leverage, total leverage, fixed charges, EBITDA, capital expenditures and other covenants as defined in the agreement. The Company was in compliance with the required covenants as of March 31, 2017, and June 30, 2016. In November 2016, Company and Cerberus amended the Secured Loan, which modified the compliance levels of certain financial covenants and specified that the Company pay a fee of $0.3 million. In conjunction with the amendment, the Company repaid $5.0 million of the outstanding principal amount. In March 2017, the Secured Loan was further amended, which (i) modified the compliance levels and definitions of certain financial covenants (ii) increased the applicable interest rate margins under the Secured Loan by 0.50% until certain specified conditions are met, (iii) required the Company to obtain a letter of credit in the amount of $12.5 million for the benefit of the administrative agent, which is drawable and will be applied to any outstanding principal balance upon the occurrence or nonoccurrence of certain conditions and events and (iv) specified that the Company pay a fee of $0.3 million. The net proceeds from the offering, after deducting the initial purchaser’s discount and commission and the related offering costs, were approximately $65.5 million. The offering costs of $3.1 million and the initial purchaser’s discount and commission of $1.4 million are classified within long-term debt on the condensed consolidated balance sheets and are being amortized to interest expense using the effective interest method over five years. The funds associated with the $12.5 million letter of credit were reclassified from cash and cash equivalents to long-term restricted cash on the condensed consolidated balance sheet at the time of the amendment in March 2017. 3.75% Convertible Senior Notes due August 2016 In August 2011, the Company issued the 3.75% Convertible Senior Notes to certain qualified institutional buyers, or QIBs. The 3.75% Convertible Senior Notes were offered and sold to the QIBs pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), or Rule 144A. The net proceeds from the $100 million offering, after deducting the initial purchaser’s discount and commission and the related offering costs, were approximately $96.1 million. The offering costs and the initial purchaser’s discount and commission were amortized to interest expense using the effective interest method over five years. The 3.75% Convertible Senior Notes bore interest at a rate of 3.75% per year, payable semi-annually in arrears in cash on February 1 and August 1 of each year, beginning on February 1, 2012. The 3.75% Convertible Senior Notes matured on August 1, 2016. A portion of these notes were redeemed in January 2016, and the remainder of these notes was redeemed on August 1, 2016, as discussed further below. The 3.75% Convertible Senior Notes were issued under an Indenture between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee. Holders of the 3.75% Convertible Senior Notes may convert their 3.75% Convertible Senior Notes at any time on or after May 1, 2016 until the close of business on the business day immediately preceding the maturity date. Prior to May 1, 2016, holders of the 3.75% Convertible Senior Notes could convert their 3.75% Convertible Senior Notes only under the following circumstances: (1) during any calendar quarter after the calendar quarter ending September 30, 2011, and only during such calendar quarter, if the closing sale price of the Company’s common stock for each of 20 or more trading days in the 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter exceeds 130% of the conversion price in effect on the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any five consecutive trading-day period (such five consecutive trading-day period, the “Note Measurement Period”) in which the trading price per $1,000 principal amount of 3.75% Convertible Senior Notes for each trading day of that Note Measurement Period was equal to or less than 98% of the product of the closing sale price of shares of the Company’s common stock and the applicable conversion rate for such trading day; (3) if the Company calls any or all of the 3.75% Convertible Senior Notes for redemption, at any time prior to the close of business on the business day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate transactions as described in the Indenture. Upon conversion by holders of the 3.75% Convertible Senior Notes, the Company will have the right to pay or deliver, as the case may be, cash, shares of common stock of the Company or a combination thereof, at the Company’s election. At any time on or prior to the 33rd business day immediately preceding the maturity date, the Company may irrevocably elect to (a) deliver solely shares of common stock of the Company in respect of the Company’s conversion obligation or (b) pay cash up to the aggregate principal amount of the 3.75% Convertible Senior Notes to be converted and pay or deliver, as the case may be, cash, shares of common stock of the Company or a combination thereof in respect of the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount of the 3.75% Convertible Senior Notes being converted. The initial conversion rate was 105.5548 shares of the Company’s common stock per $1,000 principal amount of 3.75% Convertible Senior Notes (which represents an initial conversion price of approximately $9.47 per share of the Company’s common stock). In accordance with ASC 470-20, Debt with Conversion and Other Options , the Company separately accounts for the liability and equity conversion components of the 3.75% Convertible Senior Notes. The principal amount of the liability component of the 3.75% Convertible Senior Notes was $75.9 million as of the date of issuance based on the present value of its cash flows using a discount rate of 10%, our approximate borrowing rate at the date of the issuance for a similar debt instrument without the conversion feature. The carrying value of the equity conversion component was $24.1 million. A portion of the initial purchaser’s discount and commission and the offering costs totaling $0.9 million was allocated to the equity conversion component. The liability component is being accreted to the principal amount of the 3.75% Convertible Senior Notes using the effective interest method over five years. In January 2016, the Company repurchased approximately $63.4 million in aggregate principal amount of the 3.75% Convertible Senior Notes for $66.6 million in cash. In August 2016, the Company settled the remaining 3.75% Convertible Senior Notes for approximately $36.6 million aggregate principal amount and $0.7 million accrued interest for approximately $37.3 million in cash. 3.50% Convertible Senior Notes due February 2018 In February 2013, the Company issued $115.0 million aggregate principal amount of its 3.50% Convertible Senior Notes to certain Qualified Institutional Buyers or QIBs. The 3.50% Convertible Senior Notes were offered and sold to the QIBs pursuant to Rule 144A. The net proceeds from the offering, after deducting the initial purchaser’s discount and commission and the related offering costs, were approximately $110.5 million. The offering costs and the initial purchaser’s discount and commission are both being amortized to interest expense using the effective interest method over five years. The 3.50% Convertible Senior Notes bear interest at a rate of 3.50% per year, payable semi-annually in arrears in cash on February 1 and August 1 of each year, which began on August 1, 2013. The 3.50% Convertible Senior Notes will mature on February 1, 2018, unless earlier repurchased, redeemed or converted. In April 2014, through a series of transactions, the Company refinanced approximately $70.3 million aggregate principal amount of the 3.50% Convertible Senior Notes with approximately $70.3 million aggregate principal amount of the Company’s new 3.50% Series A Convertible Senior Notes due 2018 (the “3.50% Series A Convertible Notes”). The 3.50% Convertible Notes were issued under an Indenture between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee. Holders of the 3.50% Convertible Notes may convert their 3.50% Convertible Notes at any time until the close of business on the business day immediately preceding the maturity date. The 3.50% Convertible Notes are convertible, as described below into common stock of the Company at an initial conversion rate equal to 187.6877 shares of common stock per $1,000 principal amount of the 3.50% Convertible Notes, which is equivalent to a conversion price of approximately $5.33 per share of common stock, subject to adjustment. Holders of the 3.50% Convertible Notes who convert their 3.50% Convertible Notes in connection with a “make-whole fundamental change”, as defined in the Indenture, may be entitled to a make-whole premium in the form of an increase in the conversion rate. Additionally, in the event of a “fundamental change,” as defined in the Indenture, holders of the 3.50% Convertible Notes may require the Company to purchase all or a portion of their 3.50% Convertible Notes at a fundamental change repurchase price equal to 100% of the principal amount of 3.50% Convertible Notes, plus accrued and unpaid interest, if any, to, but not including, the fundamental change repurchase date. In accordance with guidance in ASC 470-20, Debt with Conversion and Other Options and ASC 815-15, Embedded Derivatives , the Company determined that the embedded conversion components of the 3.50% Convertible Note do not require bifurcation and separate accounting. The remaining $44.7 million principal amount of the 3.50% Convertible Note has been recorded in short-term Debt on the condensed consolidated balance sheet as of March 31, 2017. 3.50% Series A Convertible Senior Notes due February 2018 In April 2014, the Company entered into note exchange agreements with certain holders (the “Participating Holders”) of the 3.50% Convertible Notes to refinance approximately $70.3 million aggregate principal amount of the 3.50% Convertible Notes with approximately $70.3 million aggregate principal amount of the 3.50% Series A Convertible Notes. Pursuant to the note exchange agreements, the Company also paid the Participating Holders an aggregate of approximately $0.4 million in cash in connection with such transactions. The principal amount of 3.50% Convertible Notes refinanced for each $1,000 principal amount of the 3.50% Series A Convertible Notes was $1,000 and the amount in cash paid per $1,000 principal amount of such 3.50% Convertible Notes delivered was determined in individual negotiations between the Company and each Participating Holder. The 3.50% Series A Convertible Notes have the same interest rate, maturity and other terms as the 3.50% Convertible Notes, except that the 3.50% Series A Convertible Notes are convertible into cash, shares of the Company’s common stock or a combination of cash and shares of common stock, at the Company’s option. The 3.50% Series A Convertible Notes were issued under an Indenture between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee. Holders of the 3.50% Series A Convertible Notes may convert their Securities at any time on or after November 1, 2017 until the close of business on the business day immediately preceding the maturity date. Prior to November 1, 2017, holders of the 3.50% Series A Convertible Notes may convert their securities only under the following circumstances: (1) during any calendar quarter after the calendar quarter ending September 30, 2014, and only during such calendar quarter, if the closing sale price of the Company’s common stock for each of 20 or more trading days in the 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter exceeds 130% of the conversion price in effect on the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any five consecutive trading-day period (such five consecutive trading-day period, the “Note Measurement Period”) in which the trading price per $1,000 principal amount of 3.50% Series A Convertible Notes for each trading day of that Note Measurement Period was equal to or less than 98% of the product of the closing sale price of shares of the Company’s common stock and the applicable conversion rate for such trading day; or (3) upon the occurrence of specified corporate transactions as described in the Indenture. Upon conversion by holders of the 3.50% Series A Convertible Notes, the Company will have the right to pay or deliver, as the case may be, cash, shares of common stock of the Company or a combination thereof, at the Company’s election. At any time on or prior to the 17th business day immediately preceding the maturity date, the Company may irrevocably elect to (a) deliver solely shares of common stock of the Company in respect of the Company’s conversion obligation or (b) pay cash up to the aggregate principal amount of the 3.50% Series A Convertible Notes to be converted and pay or deliver, as the case may be, cash, shares of common stock of the Company or a combination thereof in respect of the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount of the 3.50% Series A Convertible Notes being converted. The initial conversion rate is 187.6877 shares of the Company’s common stock per $1,000 principal amount of 3.50% Series A Convertible Notes (which represents an initial conversion price of approximately $5.33 per share of the Company’s common stock). The conversion rate, and thus the conversion price, is subject to adjustment as further described below. Holders of the 3.50% Series A Convertible Notes who convert their notes in connection with a “make-whole fundamental change”, as defined in the Indenture, may be entitled to a make-whole premium in the form of an increase in the conversion rate. Additionally, in the event of a “fundamental change,” as defined in the Indenture, holders of the 3.50% Series A Convertible Notes may require the Company to purchase all or a portion of their 3.50% Series A Convertible Notes at a fundamental change repurchase price equal to 100% of the principal amount of the 3.50% Series A Convertible Notes, plus accrued and unpaid interest, if any, to, but not including, the fundamental change repurchase date. In accordance with Accounting Standards Codification, or ASC 470-20, Debt with Conversion and Other Options , the Company separately accounts for the liability and equity conversion components of the 3.50% Series A Convertible Notes. The principal amount of the liability component of the 3.50% Series A Convertible Notes was $62.5 million as of the date of issuance based on the present value of its cash flows using a discount rate of 7%, our approximate borrowing rate at the date of the issuance for a similar debt instrument without the conversion feature. The carrying value of the equity conversion component was $7.9 million. In addition, the portion of the cash amount paid to the Participating Holders totaling $0.4 million was allocated to the debt discount with the remaining $47,000 to the equity component. The liability component is being accreted to the principal amount of the 3.50% Series A Convertible Notes using the effective interest method through the maturity in February 2018. The following table presents the carrying values of all Convertible Notes and notes issued pursuant to the Secured Loan (collectively, “Notes”) as of March 31, 2017 (in thousands): 3.50% 3.50% Secured Convertible Series A Loan Notes Convertible Notes Total Principal amount of the Notes $ $ $ $ Unamortized debt costs ) ) — ) Unamortized debt discount ) — ) ) Net carrying amount $ $ $ $ The net carrying amount of the equity conversion component related to the 3.5% Series A Convertible Note was approximately $7.8 million at March 31, 2017. The fair value of the Company’s 3.50% Convertible Notes was $48.8 million and $51.5 million at March 31, 2017 and June 30, 2016, respectively. The fair value of the Company’s 3.50% Series A Convertible Notes was $76.9 million and $81.1 million at March 31, 2017 and June 30, 2016, respectively. These borrowings are valued based on the closing trading price per $100 of the Convertible Notes as of the last day of trading for the period and are classified as Level 2 within the fair value hierarchy. The carrying value of the Company’s Secured Loan approximates its estimated fair value as these borrowings have a variable rate structure that is based on a market observable interest rate that resets periodically. The Secured Loan is classified as Level 2 within the fair value hierarchy. A summary of interest expense on the Notes is as follows (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Interest expense related to contractual interest coupon $ $ $ $ Interest expense related to amortization of debt discount Interest expense related to amortization of debt issuance costs $ $ $ $ |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Mar. 31, 2017 | |
Accumulated Other Comprehensive Loss | |
Accumulated Other Comprehensive Loss | 9. Accumulated Other Comprehensive Loss The components of accumulated other comprehensive loss consist of net loss, unrealized gains and losses on available-for-sale investments, changes in foreign currency exchange rate translation and net changes related to defined benefit pension plan. These components are excluded from earnings and reported as a component of stockholders’ equity. The foreign currency translation adjustment results from those subsidiaries not using the United States dollar as their functional currency since the majority of their economic activities are primarily denominated in their applicable local currency. Accordingly, all assets and liabilities related to these operations are translated at the current exchange rates at the end of each period. The resulting cumulative translation adjustments are recorded directly to the accumulated other comprehensive loss account in stockholders’ equity. Revenues and expenses are translated at average exchange rates in effect during the period. The components of accumulated other comprehensive loss in the equity section of the balance sheets are as follows (in thousands): March 31, June 30, 2017 2016 Net unrealized loss on short-term investments $ ) $ ) Cumulative foreign currency translation adjustment Defined benefit pension obligation ) ) Accumulated other comprehensive loss $ ) $ ) |
Subsequent Events
Subsequent Events | 9 Months Ended |
Mar. 31, 2017 | |
Subsequent Events | |
Subsequent Events | 10. Subsequent Events On April 24, 2017, the Company decided to eliminate the role of Chief Operating Officer following the conclusion of fiscal year 2017. As a consequence, Kelly Londy, the Company’s Executive Vice President, Chief Operating Officer, will be leaving the Company on July 5, 2017. |
Summary of Significant Accoun16
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Mar. 31, 2017 | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant inter-company transactions and balances have been eliminated in consolidation. The accompanying condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”), pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and note disclosures have been condensed or omitted pursuant to such rules and regulations. The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair presentation of the periods presented. Certain amounts in the prior year’s condensed consolidated balance sheet have been reclassified to conform to the current period’s presentation. These reclassifications had no impact on previously reported condensed consolidated cash flows or statements of operations. The results for the three and nine months ended March 31, 2017 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2017, or for any other future interim period or fiscal year. These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and accompanying notes for the fiscal year ended June 30, 2016 included in the Company’s Annual Report on Form 10-K filed with the SEC on August 24, 2016. The Company’s significant accounting policies are described in Note 2 to those audited consolidated financial statements and there have been no subsequent material changes to such policies. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures at the date of the financial statements. Key estimates and assumptions made by the Company relate to revenue recognition, assessment of recoverability of goodwill and intangible assets, valuation of inventories, share-based compensation expense, income taxes, allowance for doubtful accounts, loss contingencies and corporate bonus expenses. Actual results could differ materially from those estimates. |
Concentration of Credit and Other Risks | Concentration of Credit and Other Risks The Company’s cash, cash equivalents and investments are deposited with several major financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. The Company has not experienced any losses in such accounts and does not believe that it is exposed to any significant risk of loss on these balances. For the three months ended March 31, 2017 and 2016, there was one customer that represented 13% of total net revenue and no customers that represented 10% or more of total net revenue, respectively. For the nine months ended March 31, 2017 and 2016, there were no customers that represented more than 10% of total net revenue, respectively. One customer accounted for 25% and 18% of the Company’s total accounts receivable as of March 31, 2017 and June 30, 2016, respectively. Accounts receivable are typically not collateralized. The Company performs ongoing credit evaluations of its customers and maintains reserves for potential credit losses. Accounts receivable are deemed past due in accordance with the contractual terms of the agreement pursuant to which the receivables are generated. Accounts receivable balances are charged against the allowance for doubtful accounts once collection efforts are unsuccessful. Single source suppliers presently provide the Company with several components. In most cases, if a supplier was unable to deliver these components, the Company believes that it would be able to find other sources at comparable prices for these components subject to any regulatory qualifications, if required. |
Revenue Recognition | Revenue Recognition The Company earns revenue from the sale of products and related services. The Company records revenues net of any value added or sales tax. For arrangements with multiple elements, the Company allocates arrangement fees to products and services based upon Vendor Specific Objective Evidence (VSOE) of fair value of the respective elements, Third-Party Evidence (TPE), or Best Estimate of Selling Price (BESP), using the relative selling price method. Product and Service Revenue The majority of product revenue is generated from sales of CyberKnife and TomoTherapy Systems. If the Company is responsible for installation, the Company recognizes revenue after installation and acceptance of the system. Otherwise, revenue is recognized upon delivery, assuming all other revenue recognition criteria are met. The Company offers systems with post-contract customer support (PCS), installation services, training and professional services. PCS includes planned and corrective maintenance services, software updates, bug fixes, as well as call-center support. Service revenue is generated primarily from PCS (warranty period services and post warranty services), installation services, training, parts and upgrades that are sold under service contracts and professional services. PCS revenue is deferred and recognized over the service period. Installation service revenue is recognized concurrently with system revenue. Training and professional service revenues that are not deemed essential to the functionality of the systems are recognized as such services are performed. Costs associated with service revenue are expensed when incurred, except when those costs are related to parts or system upgrades where revenue recognition has been deferred. In those cases, the costs are deferred and recognized over the period of revenue recognition. |
Net Income (Loss) Per Common Share | Net Income (Loss) Per Common Share Basic and diluted net income (loss) per share is computed by dividing net income (loss) attributable to stockholders by the weighted average number of common shares outstanding during the period. A reconciliation of the numerator and denominator used in the calculation of basic and diluted net income (loss) per common share follows (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Numerator: Net income (loss) used to compute basic and diluted net income (loss) per share $ ) $ $ ) $ ) Denominator: Weighted average shares used to compute basic net income (loss) per share Weighted average effect of dilutive stock options — — — Weighted average effect of dilutive RSUs, PSUs and MSUs — — — Weighted average effect of 3.50% Series A convertible notes — — — Weighted average shares used to compute diluted net income (loss) per share The potentially dilutive shares of the Company’s common stock resulting from the assumed exercise of outstanding stock options, the vesting of Restricted Stock Units (RSU), Market Stock Units (MSU) and Performance Stock Units (PSU), and the purchase of shares under the Employee Stock Purchase Program (ESPP), as determined under the treasury stock method, are excluded from the computation of diluted net loss per share because their effect would have been anti-dilutive. Additionally, the 3.75% Convertible Senior Notes (the “3.75% Convertible Notes”), the 3.50% Convertible Senior Notes due February 1, 2018 (the “3.50% Convertible Notes”), the 3.50% Series A Convertible Notes (the “3.50% Series A Convertible Notes”) due February 1, 2018 (together, the “Convertible Notes”) are included in the calculation of diluted net income per share only if their inclusion is dilutive. For the three months ended March 31, 2016, the potentially dilutive shares issuable upon the conversion of the 3.50% Series A Convertible Notes were included in the calculation of the diluted net income per share, while the dilutive shares issuable upon the conversion of the 3.50% Convertible Notes were excluded from the calculation of diluted net income per share as their inclusion would have been anti-dilutive. The following table sets forth all potentially dilutive securities excluded from the computation in the table above because their effect would have been anti-dilutive (in thousands): As of March 31, 2017 2016 Stock options RSUs, PSUs and MSUs 3.50% Convertible Notes 3.50% Series A Convertible Notes — — |
Outstanding Convertible Notes - Diluted Share Impact | Outstanding Convertible Notes—Diluted Share Impact The 3.50% Series A Convertible Notes have an optional physical (share), cash or combination settlement feature and contain certain conditional conversion features. Due to the optional cash settlement feature and management’s intent to settle the principal amount thereof in cash, the conversion shares underlying the outstanding principal amount of the 3.50% Series A Convertible Notes, totaling approximately 13.2 million shares were not included in the potentially diluted share count table above. The zero potentially dilutive shares of the 3.50% Series A Convertible Notes as of March 31, 2017, included in the table above are the result of the lower average share price, which was below the conversion price and management’s intent to settle the principal amount thereof in cash. The number of premium shares included in the Company’s diluted share count will vary with fluctuations in the Company’s share price. Higher actual share prices result in a greater number of premium shares. The 3.75% Convertible Notes were fully settled in cash during January and August of 2016 as further discussed in Note 8. As of March 31, 2016, approximately 10.6 million shares related to the 3.75% Convertible Notes were excluded from the potentially dilutive share count table above due to the optional cash settlement feature and management’s intent to settle the principal amount thereof in cash. In addition, there were no premium shares associated with the 3.75% Convertible Notes as the Company’s average share price did not exceed the conversion price as of March 31, 2016. |
Segment Information | Segment Information The Company has one operating and reporting segment (oncology systems group), which develops, manufactures and markets proprietary medical devices used in radiation therapy and radiosurgery for the treatment of cancer patients. The Company’s Chief Executive Officer, its Chief Operating Decision Maker, reviews financial information presented on a consolidated basis for purposes of making operating decisions and assessing financial performance. The Company does not assess the performance of its individual product lines on measures of profit or loss, or asset based metrics. Therefore, the information below is presented only for revenues and long-lived tangible assets by geographic areas. Revenue by geographic region is based on the shipping addresses of the Company’s customers. The following summarizes revenue by geographic region (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Americas $ $ $ $ Europe, Middle East, India and Africa Asia-Pacific Japan Total $ $ $ $ Information regarding geographic areas in which the Company has long lived tangible assets is as follows (in thousands): March 31, June 30, 2017 2016 Americas $ $ Europe, Middle East, India and Africa Asia-Pacific Japan Total $ $ |
Recent Accounting Standard Update Not Yet Effective | |
Accounting Standard Updates | Recent Accounting Standard Update Not Yet Effective In March 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) No. 2017-07, Compensation-Retirement Benefits (Topic 715)-Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This guidance revises the presentation of employer-sponsored defined benefit pension and other postretirement plans for the net periodic benefit cost in the statement of operations and requires that the service cost component of net periodic benefit be presented in the same income statement line items as other employee compensation costs for services rendered during the period. The other components of the net benefit costs are required to be presented in the statement of operations separately from the service cost component and outside the subtotal of income from operations. This guidance allows only the service cost component of net periodic benefit costs to be eligible for capitalization. The guidance will be effective for the Company in the first quarter of its fiscal year 2019 and early adoption is permitted as of the beginning of an annual reporting period. The Company has not yet determined whether it will elect early adoption and is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other Topics (Topic 350)-Simplifying the Test for Goodwill Impairment. This guidance eliminates the requirement to calculate the implied fair value of goodwill of a reporting unit by determining the fair value of its assets and liabilities (including unrecognized assets and liabilities) to measure a goodwill impairment charge. Instead, an entity will record an impairment charge based on the excess of the reporting unit’s carrying amount over its fair value. The ASU will be effective for the Company in the first quarter of its fiscal year 2021 on a prospective basis and earlier adoption is permitted for goodwill impairment tests performed on testing dates after January 1, 2017. The Company has not yet determined whether it will elect early adoption and is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which clarifies the presentation and classification of certain cash receipts and cash payments in the statement of cash flows. This ASU will be effective for the Company in the first quarter of its fiscal year 2019 and early adoption is permitted. The Company has not yet determined whether it will elect early adoption and is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In June 2016, the FASB issued ASU No. 2016-13 Measurement of Credit Losses on Financial Instruments (ASU 2016-13). ASU 2016-13 requires measurement and recognition of expected credit losses for financial assets held. This ASU will be effective for the Company in the first quarter of its fiscal year 2021 and must be adopted using a modified retrospective approach, with certain exceptions. Early adoption is permitted beginning in the first quarter of the Company’s fiscal year 2020. The Company is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718) . The new guidance simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. In addition, the guidance provides an option to recognize forfeitures as they occur versus estimating them at the time of grant. This ASU will be effective for the Company in the first quarter of its fiscal year 2018 and early adoption is permitted. The Company is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . Under the new guidance, a lessee will be required to recognize assets and liabilities for all leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as finance or operating lease. This ASU will be effective for the Company in the first quarter of its fiscal year 2020 and early adoption is permitted. The ASU requires adoption based upon a modified retrospective transition approach. Company has not yet selected a transition method, has not yet determined whether it will elect early adoption and is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities (ASU 2016-01). ASU 2016-01 changes accounting for equity investments, financial liabilities under the fair value option and the presentation and disclosure requirements for financial instruments. In addition, it clarified guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. This ASU will be effective for the Company in the first quarter of its fiscal year 2019 and must be adopted using a modified retrospective approach, with certain exceptions. Early adoption is permitted for certain provisions. The Company has not yet determined whether it will elect early adoption and is currently evaluating the impact of the adoption of this standard on its consolidated financial statements and related disclosures. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers: Topic 606 (ASU 2014-09), to supersede nearly all existing revenue recognition guidance under GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing GAAP including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. ASU 2014-09 is required to be adopted, using either of two methods: (i) retrospective to each prior reporting period presented with the option to elect certain practical expedients as defined within ASU 2014-09; or (ii) retrospective with the cumulative effect of initially applying ASU 2014-09 recognized at the date of initial application and providing certain additional disclosures. In August 2015, the FASB approved a one year deferral of the effective period of ASU 2014-09. The standard will be effective for the Company in the first quarter of its fiscal year 2019, but early adoption is permitted starting in the first quarter of fiscal year 2018. The FASB issued supplemental adoption guidance and clarification to ASU 2014-09 in 2016 and 2017. The Company intends to adopt the new standard in the first quarter of fiscal year 2019 by recognizing the cumulative effect of the new standard as an increase to the opening balance of retained earnings. Based upon the Company’s preliminary assessment, certain portions of its product revenue will be accelerated to reflect consideration upon delivery and an element of installation will be deferred until performed. Revenue policies for indirect sales and service revenues are expected to be unchanged under the new guidance. The Company also expects to capitalize incremental contract acquisition costs, such as sales commissions, and amortize over the economic life of its product or contractual relationship with the customer. The Company’s current practice is to defer sales comissions until revenue is recognized. The Company currently does not expect the application of this guidance to have a significant impact on its consolidated financial statements; however, the Company’s assessment may change as it continues its evaluation and analysis of this ASU. |
Accounting Standard Update Recently Adopted | |
Accounting Standard Updates | Accounting Standard Update Recently Adopted In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash , which provides amendments to current guidance to address the classification and presentation of changes in restricted cash in the statement of cash flows. The Company early adopted this ASU and retrospectively applied the change to the statement of cash flows for the nine months ended March 31, 2016. The Company disclosed its restricted cash on its condensed consolidated balance sheets for the years presented. The adoption of this standard did not have a significant impact on the Company’s condensed consolidated financial statements and related disclosures. |
Summary of Significant Accoun17
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Summary of Significant Accounting Policies | |
Schedule of reconciliation of the numerator and denominator used in the calculation of basic and diluted net income (loss) per common share | A reconciliation of the numerator and denominator used in the calculation of basic and diluted net income (loss) per common share follows (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Numerator: Net income (loss) used to compute basic and diluted net income (loss) per share $ ) $ $ ) $ ) Denominator: Weighted average shares used to compute basic net income (loss) per share Weighted average effect of dilutive stock options — — — Weighted average effect of dilutive RSUs, PSUs and MSUs — — — Weighted average effect of 3.50% Series A convertible notes — — — Weighted average shares used to compute diluted net income (loss) per share |
Schedule of all potentially dilutive securities excluded from the computation of basic and diluted net income (loss) per common share | The following table sets forth all potentially dilutive securities excluded from the computation in the table above because their effect would have been anti-dilutive (in thousands): As of March 31, 2017 2016 Stock options RSUs, PSUs and MSUs 3.50% Convertible Notes 3.50% Series A Convertible Notes — — |
Schedule of revenue by geographic region | The following summarizes revenue by geographic region (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Americas $ $ $ $ Europe, Middle East, India and Africa Asia-Pacific Japan Total $ $ $ $ |
Schedule of geographic areas in which the Company has long lived tangible assets | Information regarding geographic areas in which the Company has long lived tangible assets is as follows (in thousands): March 31, June 30, 2017 2016 Americas $ $ Europe, Middle East, India and Africa Asia-Pacific Japan Total $ $ |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Balance Sheet Components | |
Schedule of financing receivables | A summary of the Company’s financing receivables is presented as follows (in thousands): Financed Lease Service Contracts March 31, 2017 Receivables and Other Total Gross $ $ $ Residual value — — — Unearned income ) — ) Allowance for credit loss — — — Total, net $ $ $ Reported as: Current $ $ $ Non-current Total, net $ $ $ Financed Lease Service Contracts June 30, 2016 Receivables and Other Total Gross $ $ $ Residual value — — — Unearned income ) — ) Allowance for credit loss — — — Total, net $ $ $ Reported as: Current $ $ $ Non-current Total, net $ $ $ |
Schedule of future minimum lease payments receivable | Future minimum lease payments to be received as of March 31, 2017 are presented as follows (in thousands): Year Ending June 30, Amount 2017 (remaining 3 months) $ 2018 2019 2020 2021 2022 Total $ |
Schedule of inventories | Inventories consisted of the following (in thousands): March 31, June 30, 2017 2016 Raw materials $ $ Work-in-process Finished goods Inventories $ $ |
Schedule of property and equipment, net | Property and equipment, net consisted of the following (in thousands): March 31, June 30, 2017 2016 Furniture and fixtures $ $ Computer and office equipment Software Leasehold improvements Machinery and equipment Construction in progress Less: Accumulated depreciation ) ) Property and equipment, net $ $ |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets | |
Schedule of goodwill | Activity related to goodwill consisted of the following (in thousands): Nine Months Year Ended Ended March 31, June 30, 2017 2016 Balance at the beginning of the period $ $ Currency translation ) ) Balance at the end of the period $ $ |
Schedule of intangible assets associated with completed acquisitions | The Company’s unamortized intangible assets associated with completed acquisitions at March 31, 2017 and June 30, 2016 are as follows (in thousands): March 31, 2017 June 30, 2016 Gross Gross Carrying Accumulated Net Carrying Accumulated Net Useful Lives Amount Amortization Amount Amount Amortization Amount (in years) Developed technology 5 — 6 $ $ ) $ $ $ ) $ |
Schedule of estimated future amortization expense of purchased intangible assets | The estimated future amortization expense of purchased intangible assets as of March 31, 2017 is as follows (in thousands): Year Ending June 30, Amount 2017 (remaining 3 months) $ |
Foreign Exchange Instruments (T
Foreign Exchange Instruments (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Foreign Exchange Instruments | |
Schedule of effect of forward contracts not designated as hedging instruments and foreign currency transactions gains and losses | The following table shows the net effect of foreign currency expenses and forward contracts not designated as hedging instruments and foreign currency transactions gains and losses, which were included in “Other expense, net” on the condensed consolidated statements of operations in three and nine months ended March 31, 2017 and 2016 is as follows (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Foreign currency exchange gain (loss) on foreign contracts $ $ $ ) $ ) Foreign currency transactions gain (loss) ) ) |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Financial Instruments | |
Summary of amortized cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category for cash, cash equivalents and short-term investments | The following tables summarize the amortized cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category for cash, cash equivalents and short-term investments (in thousands): March 31, 2017 Estimated Fair Value Gross Gross Cash and Amortized Unrealized Unrealized Cash Short-term Cost Gains Losses Equivalents Investments Cash $ $ — $ — $ $ — Level 1 Money market funds — — — Level 2 U.S. government agency securities — ) — Total $ $ — $ ) $ $ June 30, 2016 Estimated Fair Value Gross Gross Cash and Amortized Unrealized Unrealized Cash Short-term Cost Gains Losses Equivalents Investments Cash $ $ — $ — $ $ — Level 1 Money market funds — — — — — — Level 2 Commercial paper — — U.S. government agency securities ) — U. S. treasury securities — — Municipal debt securities — — — Corporate debt securities — ) — ) Total $ $ $ ) $ $ |
Schedule of contractual maturities of available-for-sale securities | Contractual maturities of available-for-sale securities at March 31, 2017 were as follows (in thousands): March 31, 2017 Amortized Estimated Cost Fair Value Due in 1 year or less $ $ Due in 1-2 years $ $ |
Schedule of available-for-sale debt securities that were in a continuous unrealized loss position | The following table summarizes the available-for-sale debt securities that were in a continuous unrealized loss position, but were not deemed to be other-than-temporarily impaired (in thousands): Less Than 12 Months 12 Months or Greater Total Gross Gross Gross Unrealized Estimated Unrealized Estimated Unrealized Estimated Losses Fair Value Losses Fair Value Losses Fair Value March 31, 2017 Debt Securities: U. S. government agency securities $ ) $ $ ) $ $ ) $ Total $ ) $ $ ) $ $ ) $ June 30, 2016 Debt Securities: Corporate debt securities $ ) $ $ ) $ $ ) $ U. S. government agency securities — — ) ) Total $ ) $ $ ) $ $ ) $ |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies | |
Schedule of future minimum lease payments under non-cancelable operating lease agreements | Future minimum lease payments under non-cancelable operating lease agreements as of March 31, 2017 are as follows (in thousands): Operating Year Ending June 30, Leases 2017 (remaining 3 months) $ 2018 2019 2020 2021 Thereafter Total $ |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Share-Based Compensation | |
Summary of share-based compensation charges included in the Company's consolidated statements of operations and comprehensive loss | The following table summarizes the share-based compensation charges included in the Company’s condensed consolidated statements of operations and comprehensive loss (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Cost of revenue $ $ $ $ Research and development Selling and marketing General and administrative $ $ $ $ |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Debt | |
Schedule of carrying values of all Convertible Notes | The following table presents the carrying values of all Convertible Notes and notes issued pursuant to the Secured Loan (collectively, “Notes”) as of March 31, 2017 (in thousands): 3.50% 3.50% Secured Convertible Series A Loan Notes Convertible Notes Total Principal amount of the Notes $ $ $ $ Unamortized debt costs ) ) — ) Unamortized debt discount ) — ) ) Net carrying amount $ $ $ $ |
Summary of interest expense on all Convertible Notes | A summary of interest expense on the Notes is as follows (in thousands): Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Interest expense related to contractual interest coupon $ $ $ $ Interest expense related to amortization of debt discount Interest expense related to amortization of debt issuance costs $ $ $ $ |
Accumulated Other Comprehensi25
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Accumulated Other Comprehensive Loss | |
Schedule of accumulated other comprehensive loss in the equity section of the balance sheets | The components of accumulated other comprehensive loss in the equity section of the balance sheets are as follows (in thousands): March 31, June 30, 2017 2016 Net unrealized loss on short-term investments $ ) $ ) Cumulative foreign currency translation adjustment Defined benefit pension obligation ) ) Accumulated other comprehensive loss $ ) $ ) |
Summary of Significant Accoun26
Summary of Significant Accounting Policies - Concentration Risk (Details) - customer | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Jun. 30, 2016 | |
Total accounts receivable | Credit concentration risk | |||||
Concentration of Credit and Other Risks | |||||
Number of significant customers | 1 | 1 | |||
Percentage of concentration risk | 25.00% | 18.00% | |||
Total net revenue | Customer concentration risk | |||||
Concentration of Credit and Other Risks | |||||
Number of significant customers | 1 | 0 | 0 | 0 | |
Percentage of concentration risk | 13.00% | ||||
Total net revenue | Customer concentration risk | Minimum | |||||
Concentration of Credit and Other Risks | |||||
Percentage of concentration risk | 10.00% | 10.00% | 10.00% |
Summary of Significant Accoun27
Summary of Significant Accounting Policies - Net Income (Loss) Per Common Share and Outstanding Convertible Notes - Diluted Share Impact (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Aug. 31, 2016 | Jan. 31, 2016 | Apr. 17, 2014 | Feb. 28, 2013 | Aug. 01, 2011 | |
Numerator: | |||||||||
Net income (loss) used to compute basic and diluted net income (loss) per share | $ (5,029) | $ 756 | $ (24,324) | $ (18,297) | |||||
Denominator: | |||||||||
Weighted average shares used to compute basic net income (loss) per share | 82,913 | 80,860 | 82,268 | 80,320 | |||||
Weighted average shares used to compute diluted net income (loss) per share | 82,913 | 82,071 | 82,268 | 80,320 | |||||
Anti-dilutive securities excluded from the computation of diluted net income (loss) per share (in shares) | 16,380 | 13,917 | |||||||
3.75% Convertible Notes | |||||||||
Denominator: | |||||||||
Interest rate (as a percent) | 3.75% | 3.75% | 3.75% | 3.75% | 3.75% | ||||
Conversion shares outstanding principal amount excluded in the potentially diluted shares | 10,600 | ||||||||
3.50% Convertible Notes | |||||||||
Denominator: | |||||||||
Interest rate (as a percent) | 3.50% | 3.50% | 3.50% | 3.50% | 3.50% | ||||
Anti-dilutive securities excluded from the computation of diluted net income (loss) per share (in shares) | 8,378 | 8,378 | |||||||
3.50% Series A Convertible Notes | |||||||||
Denominator: | |||||||||
Weighted average effect of convertible notes | 500 | ||||||||
Interest rate (as a percent) | 3.50% | 3.50% | 3.50% | 3.50% | 3.50% | ||||
Conversion shares outstanding principal amount excluded in the potentially diluted shares | 13,200 | ||||||||
Stock options | |||||||||
Denominator: | |||||||||
Weighted average effect of dilutive awards | 101 | ||||||||
Anti-dilutive securities excluded from the computation of diluted net income (loss) per share (in shares) | 2,510 | 1,981 | |||||||
RSUs, PSUs and MSUs | |||||||||
Denominator: | |||||||||
Weighted average effect of dilutive awards | 610 | ||||||||
Anti-dilutive securities excluded from the computation of diluted net income (loss) per share (in shares) | 5,492 | 3,558 |
Summary of Significant Accoun28
Summary of Significant Accounting Policies - Segments (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) | Mar. 31, 2017USD ($)segment | Mar. 31, 2016USD ($) | Jun. 30, 2016USD ($) | |
Segment Information | |||||
Number of operating segments | segment | 1 | ||||
Revenue | $ 97,312 | $ 105,284 | $ 271,320 | $ 303,827 | |
Long lived tangible assets | 23,353 | 23,353 | $ 27,878 | ||
Americas | |||||
Segment Information | |||||
Revenue | 38,720 | 32,667 | 118,545 | 128,957 | |
Long lived tangible assets | 19,182 | 19,182 | 23,842 | ||
Europe, Middle East, India and Africa | |||||
Segment Information | |||||
Revenue | 21,785 | 43,643 | 68,705 | 102,461 | |
Long lived tangible assets | 706 | 706 | 551 | ||
Asia-Pacific | |||||
Segment Information | |||||
Revenue | 13,520 | 16,505 | 35,092 | 49,226 | |
Long lived tangible assets | 1,653 | 1,653 | 1,342 | ||
Japan | |||||
Segment Information | |||||
Revenue | 23,287 | $ 12,469 | 48,978 | $ 23,183 | |
Long lived tangible assets | $ 1,812 | $ 1,812 | $ 2,143 |
Balance Sheet Components (Detai
Balance Sheet Components (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Jun. 30, 2016 | |
Financing receivables | |||||
Sales-type leases | $ 3,000 | $ 3,000 | $ 3,500 | ||
Accounts receivable with contractual maturities of more than one year | 2,500 | 2,500 | 4,100 | ||
Gross | 8,473 | 8,473 | 10,838 | ||
Unearned income | (465) | (465) | (623) | ||
Total, net | 8,008 | 8,008 | 10,215 | ||
Current | 2,546 | 2,546 | 2,618 | ||
Non-current | 5,462 | 5,462 | 7,597 | ||
Capital leases future minimum payments receivable | |||||
2017 (remaining 3 months) | 155 | 155 | |||
2,018 | 930 | 930 | |||
2,019 | 930 | 930 | |||
2,020 | 930 | 930 | |||
2,021 | 930 | 930 | |||
2,022 | 310 | 310 | |||
Total | 4,185 | 4,185 | |||
Inventories | |||||
Raw materials | 45,815 | 45,815 | 50,480 | ||
Work-in-process | 17,477 | 17,477 | 20,190 | ||
Finished goods | 53,281 | 53,281 | 45,317 | ||
Inventories | 116,573 | 116,573 | 115,987 | ||
Property and equipment, net | |||||
Property and equipment, gross | 102,946 | 102,946 | 100,331 | ||
Less: Accumulated depreciation | (79,593) | (79,593) | (72,453) | ||
Property and equipment, net | 23,353 | 23,353 | 27,878 | ||
Depreciation expense | 2,600 | $ 2,600 | 7,900 | $ 7,700 | |
Furniture and fixtures | |||||
Property and equipment, net | |||||
Property and equipment, gross | 4,511 | 4,511 | 4,527 | ||
Computer and office equipment | |||||
Property and equipment, net | |||||
Property and equipment, gross | 11,852 | 11,852 | 11,485 | ||
Software | |||||
Property and equipment, net | |||||
Property and equipment, gross | 11,362 | 11,362 | 11,104 | ||
Leasehold improvements | |||||
Property and equipment, net | |||||
Property and equipment, gross | 23,030 | 23,030 | 21,632 | ||
Machinery and equipment | |||||
Property and equipment, net | |||||
Property and equipment, gross | 50,120 | 50,120 | 47,171 | ||
Construction in progress | |||||
Property and equipment, net | |||||
Property and equipment, gross | 2,071 | 2,071 | 4,412 | ||
Lease Receivables | |||||
Financing receivables | |||||
Gross | 4,185 | 4,185 | 4,998 | ||
Unearned income | (465) | (465) | (623) | ||
Total, net | 3,720 | 3,720 | 4,375 | ||
Current | 753 | 753 | 840 | ||
Non-current | 2,967 | 2,967 | 3,535 | ||
Financed Service Contracts and Other | |||||
Financing receivables | |||||
Gross | 4,288 | 4,288 | 5,840 | ||
Total, net | 4,288 | 4,288 | 5,840 | ||
Current | 1,793 | 1,793 | 1,778 | ||
Non-current | $ 2,495 | $ 2,495 | $ 4,062 |
Goodwill and Intangible Asset30
Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Jun. 30, 2016 | |
Changes in the carrying amount of goodwill | ||||||
Balance at the beginning of the period | $ 57,848 | $ 58,054 | $ 58,054 | |||
Currency translation | (106) | (206) | ||||
Balance at the end of the period | $ 57,742 | 57,742 | 57,848 | |||
Impairment of goodwill | $ 0 | |||||
Amortization expense | 2,000 | $ 2,000 | 6,000 | $ 6,000 | ||
Estimated future amortization expense of purchased intangible assets | ||||||
2017 (remaining 3 months) | 1,646 | 1,646 | ||||
Developed technology | ||||||
Changes in the carrying amount of goodwill | ||||||
Gross Carrying Amount | 46,743 | 46,743 | 46,743 | |||
Accumulated Amortization | (45,097) | (45,097) | (39,132) | |||
Net Amount | $ 1,646 | $ 1,646 | $ 7,611 | |||
Developed technology | Minimum | ||||||
Changes in the carrying amount of goodwill | ||||||
Useful Lives | 5 years | |||||
Developed technology | Maximum | ||||||
Changes in the carrying amount of goodwill | ||||||
Useful Lives | 6 years |
Foreign Exchange Instruments (D
Foreign Exchange Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Jun. 30, 2016 | |
Foreign currency forward contracts | $ 0 | $ 0 | $ 0 | ||
Other expense, net | |||||
Foreign currency transactions gain (loss) | (44) | $ (116) | 40 | $ 316 | |
Other expense, net | Foreign contracts | |||||
Foreign currency transactions gain (loss) | $ 225 | $ 117 | $ (942) | $ (2,186) | |
Maximum | |||||
Length of forward contracts | 3 months |
Financial Instruments - Investm
Financial Instruments - Investment (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Mar. 31, 2017USD ($)position | Mar. 31, 2017USD ($)position | Jun. 30, 2016USD ($)position | |
Cash, cash equivalents and short-term investments | |||
Amortized Cost | $ 84,167 | $ 84,167 | $ 167,025 |
Gross Unrealized Gains | 8 | ||
Gross Unrealized Losses | (91) | (91) | (23) |
Cash and Cash Equivalents | 60,170 | 60,170 | 119,771 |
Short-term Investments | 23,906 | 23,906 | 47,239 |
Other-than-temporary impairments | 0 | 0 | 0 |
Amortized Cost | |||
Due in 1 year or less | 9,000 | 9,000 | |
Due in 1-2 years | 14,997 | 14,997 | |
Total Amortized Cost | 23,997 | 23,997 | |
Estimated Fair Value | |||
Due in 1 year or less | 8,983 | 8,983 | |
Due in 1-2 years | 14,923 | 14,923 | |
Available-for-sale Securities | 23,906 | 23,906 | |
Gross Unrealized Losses | |||
Less Than 12 Months | (86) | (3) | |
12 Months or Greater | (5) | (20) | |
Total | (91) | (23) | |
Estimated Fair Value | |||
Less Than 12 Months | 20,912 | 20,912 | 6,325 |
12 Months or Greater | 2,994 | 2,994 | 23,148 |
Total | $ 23,906 | $ 23,906 | $ 29,473 |
Number of positions held in an unrealized loss position | position | 8 | 8 | 11 |
U.S. government agency securities | |||
Gross Unrealized Losses | |||
Less Than 12 Months | $ (86) | ||
12 Months or Greater | (5) | $ (17) | |
Total | (91) | (17) | |
Estimated Fair Value | |||
Less Than 12 Months | $ 20,912 | 20,912 | |
12 Months or Greater | 2,994 | 2,994 | 19,988 |
Total | 23,906 | 23,906 | 19,988 |
Corporate debt securities | |||
Gross Unrealized Losses | |||
Less Than 12 Months | (3) | ||
12 Months or Greater | (3) | ||
Total | (6) | ||
Estimated Fair Value | |||
Less Than 12 Months | 6,325 | ||
12 Months or Greater | 3,160 | ||
Total | 9,485 | ||
Cash | |||
Cash, cash equivalents and short-term investments | |||
Amortized Cost | 58,669 | 58,669 | 95,906 |
Cash and Cash Equivalents | 58,669 | 58,669 | 95,906 |
Level 1 | |||
Cash, cash equivalents and short-term investments | |||
Amortized Cost | 13,362 | ||
Cash and Cash Equivalents | 13,362 | ||
Level 1 | Money market funds | |||
Cash, cash equivalents and short-term investments | |||
Amortized Cost | 1,501 | 1,501 | 13,362 |
Cash and Cash Equivalents | 1,501 | 1,501 | 13,362 |
Level 2 | |||
Cash, cash equivalents and short-term investments | |||
Amortized Cost | 57,757 | ||
Gross Unrealized Gains | 8 | ||
Gross Unrealized Losses | (23) | ||
Cash and Cash Equivalents | 10,503 | ||
Short-term Investments | 47,239 | ||
Level 2 | Commercial paper | |||
Cash, cash equivalents and short-term investments | |||
Amortized Cost | 14,704 | ||
Cash and Cash Equivalents | 8,938 | ||
Short-term Investments | 5,766 | ||
Level 2 | U.S. government agency securities | |||
Cash, cash equivalents and short-term investments | |||
Amortized Cost | 23,997 | 23,997 | 28,000 |
Gross Unrealized Gains | 7 | ||
Gross Unrealized Losses | (91) | (91) | (17) |
Short-term Investments | $ 23,906 | $ 23,906 | 27,990 |
Level 2 | U.S. treasury securities | |||
Cash, cash equivalents and short-term investments | |||
Amortized Cost | 3,997 | ||
Gross Unrealized Gains | 1 | ||
Short-term Investments | 3,998 | ||
Level 2 | Municipal debt securities | |||
Cash, cash equivalents and short-term investments | |||
Amortized Cost | 1,565 | ||
Cash and Cash Equivalents | 1,565 | ||
Level 2 | Corporate debt securities | |||
Cash, cash equivalents and short-term investments | |||
Amortized Cost | 9,491 | ||
Gross Unrealized Losses | (6) | ||
Short-term Investments | $ 9,485 |
Commitments and Contingencies -
Commitments and Contingencies - Operating Lease Agreements (Details) - USD ($) $ in Thousands | 1 Months Ended | ||||||
Nov. 30, 2016 | Aug. 31, 2016 | Jan. 31, 2016 | Mar. 31, 2017 | Jun. 30, 2016 | Jan. 11, 2016 | Aug. 01, 2011 | |
Future minimum lease payments under non-cancelable operating lease agreements | |||||||
2017 (remaining 3 months) | $ 2,144 | ||||||
2,018 | 8,612 | ||||||
2,019 | 6,596 | ||||||
2,020 | 6,278 | ||||||
2,021 | 5,931 | ||||||
Thereafter | 18,694 | ||||||
Total | $ 48,255 | $ 39,900 | |||||
3.75% Convertible Notes | |||||||
Operating Lease Agreements | |||||||
Aggregate principal amount of debt issued | $ 36,600 | $ 100,000 | |||||
Interest rate (as a percent) | 3.75% | 3.75% | 3.75% | 3.75% | |||
Cash paid to Participating Holders in connection with debt refinancing | $ 37,300 | $ 66,600 | |||||
Secured Loan | |||||||
Operating Lease Agreements | |||||||
Aggregate principal amount of debt issued | $ 70,000 | ||||||
Repayment of Secured Loan | $ 5,000 |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based compensation charges | ||||
Share-based compensation expense | $ 3,598 | $ 3,567 | $ 9,985 | $ 9,446 |
Cost of revenue | ||||
Share-based compensation charges | ||||
Share-based compensation expense | 519 | 448 | 1,461 | 1,270 |
Research and development | ||||
Share-based compensation charges | ||||
Share-based compensation expense | 644 | 717 | 1,808 | 1,888 |
Selling and marketing | ||||
Share-based compensation charges | ||||
Share-based compensation expense | 769 | 714 | 2,077 | 2,116 |
General and administrative | ||||
Share-based compensation charges | ||||
Share-based compensation expense | $ 1,666 | $ 1,688 | $ 4,639 | $ 4,172 |
Debt (Details)
Debt (Details) - USD ($) $ / shares in Units, shares in Thousands | Jan. 11, 2016 | Apr. 17, 2014 | Aug. 01, 2011 | Nov. 30, 2016 | Aug. 31, 2016 | Jan. 31, 2016 | Apr. 30, 2014 | Feb. 28, 2013 | Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Jun. 30, 2016 |
Debt | |||||||||||||
Cash and cash equivalents | $ 60,170,000 | $ 60,170,000 | $ 119,771,000 | ||||||||||
Other long-term assets | 10,032,000 | 10,032,000 | 10,549,000 | ||||||||||
Carrying amount of the equity conversion component | 7,800,000 | 7,800,000 | |||||||||||
Principal amount of the Notes | 176,500,000 | 176,500,000 | |||||||||||
Unamortized debt costs | (3,106,000) | (3,106,000) | |||||||||||
Unamortized debt discount | (3,357,000) | (3,357,000) | |||||||||||
Net carrying amount | 170,037,000 | 170,037,000 | |||||||||||
Interest expense related to contractual interest coupon | 2,255,000 | $ 2,677,000 | 7,125,000 | $ 6,612,000 | |||||||||
Interest expense related to amortization of debt discount | 661,000 | 1,285,000 | 2,117,000 | 5,155,000 | |||||||||
Interest expense related to amortization of debt issuance costs | 383,000 | 508,000 | 1,165,000 | 1,279,000 | |||||||||
Total interest expense recognized | 3,299,000 | $ 4,470,000 | $ 10,407,000 | $ 13,046,000 | |||||||||
Secured Loan | |||||||||||||
Debt | |||||||||||||
Aggregate principal amount of debt issued | $ 70,000,000 | ||||||||||||
Amendment fee | $ 300,000 | ||||||||||||
Increase in interest rate margin (as a percent) | 0.50% | ||||||||||||
Quarterly installment payment | $ 875,000 | ||||||||||||
Proceeds from debt, net of costs | $ 65,500,000 | ||||||||||||
Offering costs | 3,100,000 | 3,100,000 | |||||||||||
Initial purchaser's discount and commission | $ 1,400,000 | ||||||||||||
Prepayment premium if loan repaid or accelerated within the first year | 2.00% | ||||||||||||
Prepayment premium if loan repaid or accelerated within the second year | 1.00% | ||||||||||||
Repayment of Secured Loan | $ 5,000,000 | ||||||||||||
Debt issuance costs, amortization period | 5 years | ||||||||||||
Principal amount of the Notes | 61,500,000 | $ 61,500,000 | |||||||||||
Unamortized debt costs | (2,322,000) | (2,322,000) | |||||||||||
Unamortized debt discount | (1,343,000) | (1,343,000) | |||||||||||
Net carrying amount | 57,835,000 | 57,835,000 | |||||||||||
Secured Loan | Option (ii) | |||||||||||||
Debt | |||||||||||||
Interest rate (as a percent) | 3.25% | ||||||||||||
Secured Loan | Maximum | 3.50% Convertible Notes | |||||||||||||
Debt | |||||||||||||
Debt instrument maturity before reference instrument maturity date | 120 days | ||||||||||||
Secured Loan | Letter of Credit | |||||||||||||
Debt | |||||||||||||
Borrowing capacity | 12,500,000 | 12,500,000 | |||||||||||
Secured Loan | Letter of Credit | Reclassification | |||||||||||||
Debt | |||||||||||||
Cash and cash equivalents | (12,500,000) | (12,500,000) | |||||||||||
Other long-term assets | $ 12,500,000 | $ 12,500,000 | |||||||||||
Secured Loan | One month LIBOR | Option (i) | |||||||||||||
Debt | |||||||||||||
Margin on interest rate | 7.00% | 7.50% | 7.50% | ||||||||||
Secured Loan | One month LIBOR | Option (ii) | |||||||||||||
Debt | |||||||||||||
Margin on interest rate | 1.00% | ||||||||||||
Secured Loan | LIBOR | Minimum | Option (i) | |||||||||||||
Debt | |||||||||||||
Margin on interest rate | 1.00% | ||||||||||||
Secured Loan | Federal Funds Rate | Option (ii) | |||||||||||||
Debt | |||||||||||||
Margin on interest rate | 0.50% | ||||||||||||
Secured Loan | US Prime Rate | Option (ii) | |||||||||||||
Debt | |||||||||||||
Margin on interest rate | 4.75% | 5.25% | 5.25% | ||||||||||
3.75% Convertible Notes | |||||||||||||
Debt | |||||||||||||
Aggregate principal amount of debt issued | $ 100,000,000 | $ 36,600,000 | |||||||||||
Interest rate (as a percent) | 3.75% | 3.75% | 3.75% | 3.75% | 3.75% | ||||||||
Proceeds from debt, net of costs | $ 96,100,000 | ||||||||||||
Amortization period | 5 years | ||||||||||||
Debt issuance costs, amortization period | 5 years | ||||||||||||
Number of consecutive trading days during which the closing price of the entity's common stock must exceed the conversion price for at least 20 days in order for the notes to be convertible into common stock | 30 days | ||||||||||||
Number of consecutive business days immediately after any five consecutive trading day period during the note measurement period | 5 days | ||||||||||||
Number of consecutive trading days before five consecutive business days during the note measurement period | 5 days | ||||||||||||
Principal amount used for debt instrument conversion ratio | $ 1,000 | $ 1,000 | |||||||||||
Number of working days preceding maturity date for delivery of shares or payment of cash | 33 days | ||||||||||||
Conversion rate, number of shares to be issued per $1000 of principal amount (in shares) | 105.5548 | ||||||||||||
Conversion price (in dollars per share) | $ 9.47 | $ 9.47 | |||||||||||
Discount rate on liability component (as a percent) | 10.00% | ||||||||||||
Carrying amount of the equity conversion component | $ 24,100,000 | ||||||||||||
Debt issuance costs and discount allocated to equity conversion component | 900,000 | ||||||||||||
Principal amount of the Notes retired | $ 63,400,000 | ||||||||||||
Cash paid to Participating Holders in connection with debt refinancing | $ 37,300,000 | $ 66,600,000 | |||||||||||
Net carrying amount | $ 75,900,000 | ||||||||||||
Total interest expense recognized | $ 700,000 | ||||||||||||
3.75% Convertible Notes | Minimum | |||||||||||||
Debt | |||||||||||||
Number of days within 30 consecutive trading days in which the closing price of the entity's common stock must exceed the conversion price for the notes to be convertible into common stock | 20 days | ||||||||||||
Percentage of the closing sales price of the entity's common stock that the conversion price must exceed in order for the notes to be convertible | 130.00% | ||||||||||||
3.75% Convertible Notes | Maximum | |||||||||||||
Debt | |||||||||||||
Percentage of the trading price to the product of the sale price of the entity's common stock and the conversion rate | 98.00% | ||||||||||||
3.50% Convertible Notes | |||||||||||||
Debt | |||||||||||||
Aggregate principal amount of debt issued | $ 115,000,000 | ||||||||||||
Interest rate (as a percent) | 3.50% | 3.50% | 3.50% | 3.50% | 3.50% | ||||||||
Proceeds from debt, net of costs | $ 110,500,000 | ||||||||||||
Debt issuance costs, amortization period | 5 years | ||||||||||||
Principal amount used for debt instrument conversion ratio | $ 1,000 | $ 1,000 | |||||||||||
Conversion rate, number of shares to be issued per $1000 of principal amount (in shares) | 187.6877 | ||||||||||||
Conversion price (in dollars per share) | $ 5.33 | $ 5.33 | |||||||||||
Repurchase price, as percentage of principal amount, if company undergoes change of control | 100.00% | ||||||||||||
Principal amount of the Notes | $ 44,654,000 | $ 44,654,000 | |||||||||||
Aggregate principal amount of debt refinanced | $ 70,300,000 | ||||||||||||
Conversion rate, amount of debt to be issued per $1000 of principal amount | $ 1,000 | ||||||||||||
Unamortized debt costs | (784,000) | (784,000) | |||||||||||
Net carrying amount | 43,870,000 | 43,870,000 | |||||||||||
Fair value of convertible notes | $ 48,800,000 | $ 48,800,000 | 51,500,000 | ||||||||||
3.50% Series A Convertible Notes | |||||||||||||
Debt | |||||||||||||
Aggregate principal amount of debt issued | $ 70,300,000 | ||||||||||||
Interest rate (as a percent) | 3.50% | 3.50% | 3.50% | 3.50% | 3.50% | ||||||||
Number of consecutive trading days during which the closing price of the entity's common stock must exceed the conversion price for at least 20 days in order for the notes to be convertible into common stock | 30 days | ||||||||||||
Percentage of the closing sales price of the entity's common stock that the conversion price must exceed in order for the notes to be convertible | 130.00% | ||||||||||||
Number of consecutive business days immediately after any five consecutive trading day period during the note measurement period | 5 days | ||||||||||||
Number of consecutive trading days before five consecutive business days during the note measurement period | 5 days | ||||||||||||
Principal amount used for debt instrument conversion ratio | $ 1,000 | $ 1,000 | |||||||||||
Number of working days preceding maturity date for delivery of shares or payment of cash | 17 days | ||||||||||||
Conversion rate, number of shares to be issued per $1000 of principal amount (in shares) | 187.6877 | ||||||||||||
Conversion price (in dollars per share) | $ 5.33 | $ 5.33 | |||||||||||
Discount rate on liability component (as a percent) | 7.00% | ||||||||||||
Potentially dilutive shares outstanding | 500 | ||||||||||||
Principal amount of the Notes | $ 70,346,000 | $ 70,346,000 | |||||||||||
Payments made to convertible note holders | $ 400,000 | ||||||||||||
Repurchase price, as a percentage of the principal amount, in the event of a fundamental change, as defined in Indenture | 100.00% | ||||||||||||
Portion of cash amount paid allocated to debt discount | 400,000 | $ 400,000 | |||||||||||
Portion of cash amount paid allocated to equity component | 47,000 | 47,000 | |||||||||||
Unamortized debt discount | (2,014,000) | (2,014,000) | |||||||||||
Net carrying amount | 68,332,000 | 68,332,000 | |||||||||||
Fair value of convertible notes | $ 76,900,000 | $ 76,900,000 | $ 81,100,000 | ||||||||||
3.50% Series A Convertible Notes | Minimum | |||||||||||||
Debt | |||||||||||||
Number of days within 30 consecutive trading days in which the closing price of the entity's common stock must exceed the conversion price for the notes to be convertible into common stock | 20 days | ||||||||||||
3.50% Series A Convertible Notes | Maximum | |||||||||||||
Debt | |||||||||||||
Percentage of the trading price to the product of the sale price of the entity's common stock and the conversion rate | 98.00% | ||||||||||||
3.50% Convertible Notes and 3.50% Series A Convertible Notes | |||||||||||||
Debt | |||||||||||||
Fair value based on closing trading price | $ 100 |
Accumulated Other Comprehensi36
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Jun. 30, 2016 |
Accumulated Other Comprehensive Loss | ||
Net unrealized loss on short-term investments | $ (91) | $ (15) |
Cumulative foreign currency translation adjustment | 350 | 1,121 |
Defined benefit pension obligation | (2,066) | (2,066) |
Accumulated other comprehensive loss | $ (1,807) | $ (960) |