Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 29, 2019 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | NUVASIVE INC | |
Entity Central Index Key | 0001142596 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | NUVA | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 51,885,880 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 93,391 | $ 117,840 |
Accounts receivable, net of allowances of $16,125 and $16,171, respectively | 194,358 | 196,487 |
Inventory, net | 288,539 | 273,244 |
Prepaid income taxes | 16,484 | 16,905 |
Prepaid expenses and other current assets | 13,555 | 13,733 |
Total current assets | 606,327 | 618,209 |
Property and equipment, net | 247,533 | 238,841 |
Intangible assets, net | 240,663 | 252,048 |
Goodwill | 561,235 | 561,366 |
Operating lease right-of-use assets | 61,400 | |
Deferred tax assets | 4,369 | 5,263 |
Restricted cash and investments | 2,395 | 2,395 |
Other assets | 27,180 | 29,737 |
Total assets | 1,751,102 | 1,707,859 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 99,991 | 105,877 |
Contingent consideration liabilities | 6,637 | 7,560 |
Accrued payroll and related expenses | 44,824 | 59,960 |
Operating lease liabilities | 6,320 | |
Litigation liabilities | 2,045 | 1,415 |
Income tax liabilities | 1,964 | 4,648 |
Total current liabilities | 161,781 | 179,460 |
Senior convertible notes | 607,607 | 602,526 |
Deferred and income tax liabilities | 5,641 | 4,964 |
Operating lease liabilities | 67,112 | |
Other long-term liabilities | 68,955 | 86,384 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value; 5,000,000 shares authorized, none outstanding | ||
Common stock, $0.001 par value; 120,000,000 shares authorized at March 31, 2019 and December 31, 2018, 57,119,047 and 56,648,077 issued and outstanding at March 31, 2019 and December 31, 2018, respectively | 61 | 61 |
Additional paid-in capital | 1,402,797 | 1,397,829 |
Accumulated other comprehensive loss | (9,122) | (8,628) |
Retained earnings | 26,627 | 17,241 |
Treasury stock at cost; 5,262,478 shares and 5,116,496 shares at March 31, 2019 and December 31, 2018, respectively | (580,357) | (571,978) |
Total equity | 840,006 | 834,525 |
Total liabilities and equity | $ 1,751,102 | $ 1,707,859 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, allowances | $ 16,125 | $ 16,171 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 120,000,000 | 120,000,000 |
Common stock, shares issued | 57,119,047 | 56,648,077 |
Common stock, shares outstanding | 57,119,047 | 56,648,077 |
Treasury stock at cost, shares | 5,262,478 | 5,116,496 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenue | ||
Total revenue | $ 274,776 | $ 260,522 |
Cost of revenue (excluding below amortization of intangible assets) | ||
Total cost of revenue | 74,494 | 73,814 |
Gross profit | 200,282 | 186,708 |
Operating expenses: | ||
Sales, marketing and administrative | 145,076 | 146,766 |
Research and development | 17,575 | 14,491 |
Amortization of intangible assets | 13,625 | 12,425 |
Litigation liability loss | 28,995 | |
Business transition costs | 3,833 | 2,253 |
Total operating expenses | 180,109 | 204,930 |
Interest and other expense, net: | ||
Interest income | 409 | 134 |
Interest expense | (9,513) | (9,467) |
Other (expense) income, net | (366) | (9,703) |
Total interest and other expense, net | (9,470) | (19,036) |
Income (loss) before income taxes | 10,703 | (37,258) |
Income tax (expense) benefit | (1,317) | 10,126 |
Consolidated net income (loss) | $ 9,386 | $ (27,132) |
Net income (loss) per share: | ||
Basic | $ 0.18 | $ (0.53) |
Diluted | $ 0.18 | $ (0.53) |
Weighted average shares outstanding: | ||
Basic | 51,675 | 51,226 |
Diluted | 52,480 | 51,226 |
Product [Member] | ||
Revenue | ||
Total revenue | $ 243,823 | $ 233,515 |
Cost of revenue (excluding below amortization of intangible assets) | ||
Total cost of revenue | 54,486 | 55,191 |
Service [Member] | ||
Revenue | ||
Total revenue | 30,953 | 27,007 |
Cost of revenue (excluding below amortization of intangible assets) | ||
Total cost of revenue | $ 20,008 | $ 18,623 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Statement Of Income And Comprehensive Income [Abstract] | ||
Consolidated net income (loss) | $ 9,386 | $ (27,132) |
Other comprehensive (loss) income: | ||
Translation adjustments, net of tax | (494) | 2,579 |
Other comprehensive (loss) income | (494) | 2,579 |
Total consolidated comprehensive income (loss) | $ 8,892 | $ (24,553) |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Retained Earnings (Accumulated Deficit) [Member] | Treasury Stock [Member] | Total Nuvasive, Inc. Stockholders’ Equity [Member] | Non-controlling Interest [Member] |
Beginning Balance at Dec. 31, 2017 | $ 799,416 | $ 60 | $ 1,363,549 | $ (6,933) | $ 4,762 | $ (565,867) | $ 795,571 | $ 3,845 |
Beginning Balance, Shares at Dec. 31, 2017 | 56,164 | (5,002) | ||||||
Issuance of common stock under employee and director equity option and purchase plans | (1,821) | 2,012 | $ (3,833) | (1,821) | ||||
Issuance of common stock under employee and director equity option and purchase plans, Shares | 172 | (76) | ||||||
Stock-based compensation expense | 5,419 | 5,419 | 5,419 | |||||
Consolidated net income (loss) attributable to NuVasive, Inc. | (27,132) | (27,132) | (27,132) | |||||
Consideration paid in excess of non-controlling interests | (12,221) | (12,221) | (12,221) | |||||
Net loss attributable to non-controlling interests | (3,845) | $ (3,845) | ||||||
Other comprehensive income (loss) | 2,579 | 2,579 | 2,579 | |||||
Ending Balance at Mar. 31, 2018 | 762,395 | $ 60 | 1,358,759 | (4,354) | (22,370) | $ (569,700) | $ 762,395 | |
Ending Balance, Shares at Mar. 31, 2018 | 56,336 | (5,078) | ||||||
Beginning Balance at Dec. 31, 2018 | 834,525 | $ 61 | 1,397,829 | (8,628) | 17,241 | $ (571,978) | ||
Beginning Balance, Shares at Dec. 31, 2018 | 56,648 | (5,116) | ||||||
Issuance of common stock under employee and director equity option and purchase plans | (8,177) | 202 | $ (8,379) | |||||
Issuance of common stock under employee and director equity option and purchase plans, Shares | 399 | (146) | ||||||
Stock-based compensation expense | 4,766 | 4,766 | ||||||
Issuance of common stock in connection with royalty milestone achievement, Shares | 72 | |||||||
Consolidated net income (loss) attributable to NuVasive, Inc. | 9,386 | 9,386 | ||||||
Other comprehensive income (loss) | (494) | (494) | ||||||
Ending Balance at Mar. 31, 2019 | $ 840,006 | $ 61 | $ 1,402,797 | $ (9,122) | $ 26,627 | $ (580,357) | ||
Ending Balance, Shares at Mar. 31, 2019 | 57,119 | (5,262) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Operating activities: | ||
Consolidated net income (loss) | $ 9,386 | $ (27,132) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 34,054 | 32,090 |
Impairment of strategic investment | 9,003 | |
Amortization of non-cash interest | 5,210 | 4,925 |
Stock-based compensation | 5,717 | 4,134 |
Reserves on current assets | 3,785 | 4,080 |
Other non-cash adjustments | 2,816 | 4,456 |
Deferred income taxes | 1,547 | (12,671) |
Changes in operating assets and liabilities, net of effects from acquisitions: | ||
Accounts receivable | 1,620 | 16,933 |
Inventory | (19,292) | (12,126) |
Prepaid expenses and other current assets | (1,399) | (1,737) |
Accounts payable and accrued liabilities | (2,523) | 1,579 |
Accrued payroll and related expenses | (14,815) | (18,493) |
Litigation liability | 630 | 30,040 |
Income taxes | (2,261) | 1,294 |
Net cash provided by operating activities | 24,475 | 36,375 |
Investing activities: | ||
Acquisitions and investments | (51,794) | |
Purchases of intangible assets | (6,827) | (2,657) |
Purchases of property and equipment | (33,929) | (29,109) |
Net cash used in investing activities | (40,756) | (83,560) |
Financing activities: | ||
Proceeds from the issuance of common stock | 336 | |
Purchases of treasury stock | (8,177) | (2,155) |
Payment of contingent consideration | (1,435) | (8,900) |
Proceeds from revolving line of credit | 65,000 | |
Repayments on revolving line of credit | (10,000) | |
Other financing activities | 1,556 | (141) |
Net cash (used in) provided by financing activities | (8,056) | 44,140 |
Effect of exchange rate changes on cash | (112) | 982 |
Decrease in cash, cash equivalents and restricted cash | (24,449) | (2,063) |
Cash, cash equivalents and restricted cash at beginning of period | 120,235 | 78,198 |
Cash, cash equivalents and restricted cash at end of period | $ 95,786 | $ 76,135 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2019 | Mar. 31, 2018 |
Statement Of Cash Flows [Abstract] | ||
Cash and cash equivalents | $ 93,391 | $ 73,741 |
Restricted cash | 2,395 | 2,394 |
Total cash, cash equivalents and restricted cash shown in the Unaudited Consolidated Statement of Cash Flows | $ 95,786 | $ 76,135 |
Description of Business and Bas
Description of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of Business and Basis of Presentation | Description of Business NuVasive, Inc. (the “Company” or “NuVasive”) was incorporated in Delaware on July 21, 1997, and began commercializing its products in 2001. The Company’s principal product offering includes a minimally disruptive surgical platform called Maximum Access Surgery, or MAS. The MAS platform combines three categories of solutions that collectively minimize soft tissue disruption during spine fusion surgery, provide maximum visualization and are designed to enable safe and reproducible outcomes for the surgeon and the patient. The platform includes the Company’s proprietary software-driven nerve detection and avoidance systems and Intraoperative Monitoring (“IOM”) services and support; MaXcess, an integrated split-blade retractor system; and a wide variety of specialized implants and biologics. To assist with surgical procedures, the Company offers a technology platform called Integrated Global Alignment (“iGA”); in which products and computer assisted technology under the MAS platform help achieve more precise spinal alignment. The individual components of the MAS platform, and many of the Company’s products, can also be used in open or traditional spine surgery. The Company continues to focus research and development efforts to expand its MAS product platform and advance the applications of its unique technology into procedurally-integrated surgical solutions. The Company dedicates significant resources toward training spine surgeons on its unique technology and products. The Company’s procedurally integrated solutions use innovative, technological advancements and the MAS platform to provide surgical efficiency, operative reliability, and procedural versatility. The Company offers a range of implants for spinal surgery, which include its porous titanium and polyetheretherketone (“PEEK”) implants under its Advanced Materials Science portfolio, fixation devices such as customizable rods, plates and screws, bone allograft in patented saline packaging, allogeneic and synthetic biologics, and disposables used in IOM. The Company makes available MAS instrument sets, MaXcess and neuromonitoring systems to hospitals to facilitate surgeon access to the spine to perform restorative and fusion procedures using the Company’s implants and fixation devices. The Company sells MAS instrument sets, MaXcess and neuromonitoring systems to hospitals, however, such sales are immaterial to the Company’s results of operations. The Company also designs and sells expandable growing rod implant systems that can be non-invasively lengthened following implantation with precise, incremental adjustments via an external remote controller using magnetic technology called MAGnetic External Control, or MAGEC, which allows for the minimally invasive treatment of early-onset and adolescent scoliosis. This technology is also the basis for the Company’s Precice limb lengthening system, which allows for the correction of long bone limb length discrepancy, as well as enhanced bone healing in patients that have experienced traumatic injury. The Company continues to develop a wide variety of projects which broaden its MAS and other product platforms and advance the applications of its unique technology into procedurally integrated surgical solutions that improve clinical and economic outcomes, including Pulse, a surgical automation platform which incorporates neuromonitoring, surgical planning, rod bending, imaging, navigation, and other automation. Pulse is a combined hardware and software platform designed to achieve surgical efficiencies via real-time feedback to aid in clinical decision making and to optimize the procedural workflow in the operating room. The Company continues to pursue business and technology acquisition targets and strategic relationships. Basis of Presentation and Principles of Consolidation The accompanying Unaudited Consolidated Financial Statements include the accounts of the Company and its majority-owned or controlled subsidiaries, collectively referred to as either NuVasive or the Company. The Company translates the financial statements of its foreign subsidiaries using end-of-period exchange rates for assets and liabilities and average exchange rates during each reporting period for results of operations. When there is a portion of equity in an acquired subsidiary not attributable, directly or indirectly, to the respective parent entity, the Company records the fair value of the non-controlling interest at the acquisition date and classifies the amounts attributable to non-controlling interest separately in equity in the Company's Consolidated Financial Statements. Any subsequent changes in a parent's ownership interest while the parent retains its controlling financial interest in its subsidiary are accounted for as equity transactions. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying Unaudited Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Pursuant to these rules and regulations, the Company has condensed or omitted certain information and footnote disclosures it normally includes in its annual Consolidated Financial Statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for any other interim period or for the full year. These Unaudited Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2018 included in the Company’s Annual Report on Form 10-K filed with the SEC. In the opinion of management, the Unaudited Consolidated Financial Statements and notes thereto include all adjustments that are of a normal and recurring nature that are necessary for the fair presentation of the Company’s financial position and of the results of operations and cash flows for the periods presented. Use of Estimates To prepare financial statements in conformity with GAAP, management must make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Recent Accounting Pronouncements Not Yet Adopted In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2016-13, Financial Instruments – Credit Losses This update is effective for annual periods beginning after December 15, 2019, and interim periods within those periods, and early adoption is permitted The Company believes the adoption will modify the way the Company analyzes financial instruments, but it does not anticipate a material impact on results of operations. In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles – Goodwill and Other In August 2018, the FASB issued Accounting Standards Update No. 2018-13, Fair Value Measurement: Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement adds and modifies certain disclosure requirements for fair value measurements entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, or valuation processes for Level 3 fair value measurements. However, public companies will be required to disclose the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements In September 2018, the FASB issued Accounting Standards Update No. 2018-15, Intangible – Goodwill and Other – Internal-Use Software requires a customer in a cloud computing arrangement to determine which implementation costs to capitalize as assets or expense as incurred capitalized implementation costs related to a hosting arrangement that is a service contract will be amortized over the term of the hosting arrangement, beginning when the module or component of the hosting arrangement is ready for its intended use Recently Adopted Accounting Standards In February 2016, the FASB issued Accounting Standards Update No. 2016-02 – Leases The Company adopted ASC 842 as of January 1, 2019, electing the optional transition method that allows for a cumulative-effect adjustment in the period of adoption and did not restate prior periods. The Company elected the package of practical expedients permitted under the transition guidance. As a result of the adoption, the Company recorded right-of-use assets and liabilities, and their corresponding deferred tax assets and liabilities on its Unaudited Consolidated Balance Sheet. As of March 31, 2019 the Company’s right-of-use assets and liabilities were $61.4 million and $73.4 million, respectively, associated with its operating leases. See Note 10 to the Unaudited Consolidated Financial Statements for further discussion on leases. In July 2017, the FASB issued Accounting Standards Update No. 2017-11, Earnings Per Share, Distinguishing Liabilities from Equity, Derivatives and Hedging . The Company adopted In August 2017, the FASB issued Accounting Standards Update No. 2017-12, Derivatives and Hedging The Company adopted Revenue Recognition In accordance with Accounting Standards Codification 606 Revenue from Contracts with Customers Revenue from neuromonitoring services is recognized in the period the service is performed for the amount of consideration expected to be received. Inventory Net inventory as of March 31, 2019 consisted of $274.8 million of finished goods, $6.5 million of work in progress and $7.2 million of raw materials. Net inventory as of December 31, 2018 consisted of $259.4 million of finished goods, $5.0 million of work in progress and $8.8 million of raw materials. Finished goods include specialized implants and disposables and are stated at the lower of cost or market determined by utilizing a standard cost method, which includes capitalized variances, which approximates the weighted average cost. Work in progress and raw materials represent the underlying material, and labor for work in progress, that ultimately yield finished goods upon completion and are subject to lower of cost or market. The Company reviews the components of its inventory on a periodic basis for excess and obsolescence and adjusts inventory to its net realizable value as necessary. Comprehensive Income Comprehensive income is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Comprehensive income includes net of tax, unrealized gains or losses on the Company’s marketable securities and foreign currency translation adjustments. The cumulative translation adjustments included in accumulated other comprehensive loss were $9.1 million and $8.6 million at March 31, 2019 and December 31, 2018, respectively. Product Shipment Costs Product shipment costs, included in sales, marketing and administrative expense in the accompanying Unaudited Consolidated Statements of Operations, were $6.4 million and $5.9 million for the three months ended March 31, 2019 and March 31, 2018, respectively. The majority of the Company’s shipping costs are related to the loaning of instrument sets, which are not typically sold as part of the Company’s core sales offering. Amounts billed to customers for shipping and handling of products are reflected in revenues and are not material for any period presented . Business Transition Costs The Company incurs certain costs related to acquisition, integration and business transition activities, which include severance, relocation, consulting, leasehold exit costs, third-party merger and acquisition costs, contingent consideration fair value adjustments and other costs directly associated with such activities. The Company incurred $3.8 million of such costs during the three months ended March 31, 2019, which consisted primarily of acquisition, integration and business transition activities, but also included $0.4 million of fair value adjustments on contingent consideration liabilities associated with the Company’s 2017 and 2016 acquisitions. The Company incurred $2.3 million of such costs during the three months ended March 31, 2018, which consisted primarily of acquisition, integration and business transition activities, but also included $0.1 million of fair value adjustments on contingent consideration liabilities associated with the Company’s 2017 and 2016 acquisitions. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | The following table sets forth the computation of basic and diluted consolidated net income (loss) per share: Three Months Ended March 31, ( in thousands, except per share data 2019 2018 Numerator: Net income (loss) $ 9,386 $ (27,132 ) Denominator for basic and diluted net income (loss) per share: Weighted average common shares outstanding for basic 51,675 51,226 Dilutive potential common stock outstanding: Stock options and employee stock purchase plan 15 — Restricted stock units 790 — Weighted average common shares outstanding for diluted 52,480 51,226 Basic net income (loss) per share $ 0.18 $ (0.53 ) Diluted net income (loss) per share $ 0.18 $ (0.53 ) The following weighted-average outstanding common stock equivalents were not included in the calculation of net income (loss) per diluted share because their effects were anti-dilutive: Three Months Ended March 31, ( in thousands 2019 2018 Stock options, employee stock purchase plan, and restricted stock units 266 1,056 Warrants 10,865 10,865 Senior Convertible Notes 10,865 10,865 Total 21,996 22,786 |
Financial Instruments and Fair
Financial Instruments and Fair Value Measurements | 3 Months Ended |
Mar. 31, 2019 | |
Investments Debt And Equity Securities [Abstract] | |
Financial Instruments and Fair Value Measurements | Foreign Currency and Derivative Financial Instruments The Company translates the financial statements of its foreign subsidiaries using end-of-period exchange rates for assets and liabilities and average exchange rates during each reporting period for results of operations. Some of the Company’s reporting entities conduct a portion of their business in currencies other than the entity’s functional currency. These transactions give rise to receivables and payables that are denominated in currencies other than the entity’s functional currency. The value of these receivables and payables is subject to changes in currency exchange rates from the point at which the transactions are originated until the settlement in cash. Both realized and unrealized gains and losses in the value of these receivables and payables are included in the determination of net income. Net currency exchange gains (losses), which include gains and losses from derivative instruments, were $(0.3) million for both the three months ended March 31, 2019 and March 31, 2018 and are included in other (expense) income, net in the Unaudited Consolidated Statements of Operations. To manage foreign currency exposure risks, the Company uses derivatives for activities in entities that have short-term intercompany receivables and payables denominated in a currency other than the entity’s functional currency. A s of March 31, 2019 and December 31, 2018 a notional principal amount of $28.3 million and $ 26.8 was outstanding to hedge currency risk relative to the Company’s foreign receivables and payables . Derivative instrument net gains (losses) on the Company’s forward exchange contracts were $0.4 million and $(0.4) million for the three months ended March 31, 2019 and March 31, 2018, respectively, and are included in other (expense) income, net in the Unaudited Consolidated Statements of Operations. The fair value of the forward contract exchange derivative instrument asset (liability) was de minimis and $(0.3) million as of March 31, 2019 and December 31, 2018, respectively. The derivative instruments are recorded in other current assets or other current liabilities in the Unaudited Consolidated Balance Sheets commensurate with the nature of the instrument at period end. Fair Value Measurements The Company measures certain assets and liabilities in accordance with authoritative guidance which requires fair value measurements be classified and disclosed in one of the following three categories: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. The Company reviews the fair value hierarchy classification on a quarterly basis. Changes in the ability to observe valuation inputs may result in a reclassification of levels for certain assets or liabilities within the fair value hierarchy. The Company did not have any transfers of assets and liabilities between the levels of the fair value measurement hierarchy during the periods presented. The fair values of the Company’s assets and liabilities, including cash equivalents, marketable securities, restricted investments, derivatives, and contingent obligations are measured at fair value on a recurring basis. As of March 31, 2019 and December 31, 2018, the Company held investments in securities classified as cash equivalents. During the periods presented, the Company did not hold any investments that were in a significant unrealized loss position and no impairment charges were recorded. Realized gains and losses and interest income related to marketable securities were immaterial during all periods presented. Cash equivalents are determined under the fair value categories as follows: Quoted Price in Significant Other Significant Active Market Observable Inputs Unobservable ( in thousands Total (Level 1) (Level 2) Inputs (Level 3) March 31, 2019: Cash equivalents: Money market funds $ 37,300 $ 37,300 $ — $ — Total cash equivalents $ 37,300 $ 37,300 $ — $ — December 31, 2018: Cash equivalents: Money market funds $ 56,000 $ 56,000 $ — $ — Total cash equivalents $ 56,000 $ 56,000 $ — $ — The carrying amounts of certain financial instruments such as cash equivalents, accounts receivable, prepaid expenses, other current assets, accounts payable, accrued expenses, and other current liabilities as of March 31, 2019 and December 31, 2018 approximate their related fair values due to the short-term maturities of these instruments. The fair value of certain financial instruments was measured and classified within Level 1 of the fair value hierarchy based on quoted prices. Fair Value of Senior Convertible Notes The fair value, based on a quoted market price (Level 1), of the Company’s outstanding Senior Convertible Notes due 2021 at March 31, 2019 and December 31, 2018, was $723.5 million and $684.8 million, respectively. See Note 6 to the Unaudited Consolidated Financial Statements for further discussion on the carrying value of the notes. Contingent Consideration Liabilities The fair value of contingent consideration liabilities assumed in business combinations is recorded as part of the purchase price consideration of the acquisition, and is determined using a discounted cash flow model or probability simulation model. The significant inputs of such models are not observable in the market, such as certain financial metric growth rates, volatility rates, projections associated with the applicable milestone, the interest rate, and the related probabilities and payment structure in the contingent consideration arrangement. Fair value adjustments to contingent consideration liabilities are recorded through operating expenses in the Unaudited Contingent consideration liabilities were $49.3 million and $50.4 million as of March 31, 2019 and December 31, 2018, respectively, and were recorded in the Unaudited Consolidated Balance Sheet commensurate with the respective payment terms. The following table sets forth the changes in the estimated fair value of the Company’s liabilities measured on a recurring basis using significant unobservable inputs (Level 3): Three Months Ended March 31, ( in thousands 2019 2018 Fair value measurement at beginning of period $ 50,410 $ 67,941 Contingent consideration liability recorded upon acquisition — 6,663 Change in fair value measurement 356 149 Changes resulting from foreign currency fluctuations (59 ) 72 Contingent consideration paid or settled (1,435 ) (9,000 ) Fair value measurement at end of period $ 49,272 $ 65,825 Non-financial assets and liabilities measured on a nonrecurring basis Certain non-financial assets and liabilities are measured at fair value, usually with Level 3 inputs including the discounted cash flow method or cost method, on a nonrecurring basis in accordance with authoritative guidance. These include items such as non-financial assets and liabilities initially measured at fair value in a business combination and non-financial long-lived assets measured at fair value for an impairment assessment. In general, non-financial assets, including goodwill, intangible assets and property and equipment, are measured at fair value when there is an indication of impairment and are recorded at fair value only when any impairment is recognized. The carrying values of the Company’s financing lease obligations approximated their estimated fair value as of March 31, 2019 and December 31, 2018. During the three months ended March 31, 2018, the Company recorded an impairment charge of $9.0 million on a strategic investment. The impairment was recorded in other (expense) income, net in the Unaudited Consolidated Statement of Operations. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and intangible assets consisted of the following: Weighted- Average Amortization ( in thousands, except years Period Gross Accumulated Intangible March 31, 2019: (in years) Amount Amortization Assets, net Intangible assets subject to amortization: Developed technology 8 $ 271,748 $ (139,662 ) $ 132,086 Manufacturing know-how and trade secrets 13 30,796 (18,516 ) 12,280 Trade name and trademarks 9 25,500 (14,693 ) 10,807 Customer relationships 9 149,134 (63,644 ) 85,490 Total intangible assets subject to amortization 9 $ 477,178 $ (236,515 ) $ 240,663 Intangible assets not subject to amortization: Goodwill $ 561,235 Total goodwill and intangible assets, net $ 801,898 Weighted- Average Amortization Period Gross Accumulated Intangible December 31, 2018: (in years) Amount Amortization Assets, net Intangible assets subject to amortization: Developed technology 8 $ 271,748 $ (131,730 ) $ 140,018 Manufacturing know-how and trade secrets 13 30,814 (17,926 ) 12,888 Trade name and trademarks 9 25,500 (13,901 ) 11,599 Customer relationships 9 147,021 (59,478 ) 87,543 Total intangible assets subject to amortization 9 $ 475,083 $ (223,035 ) $ 252,048 Intangible assets not subject to amortization: Goodwill $ 561,366 Total goodwill and intangible assets, net $ 813,414 The following table summarizes the changes in the carrying value of the Company’s goodwill: ( in thousands December 31, 2018 Gross goodwill $ 569,666 Accumulated impairment loss (8,300 ) 561,366 Changes to gross goodwill Changes resulting from foreign currency fluctuations (131 ) (131 ) March 31, 2019 Gross goodwill 569,535 Accumulated impairment loss (8,300 ) $ 561,235 Total expense related to the amortization of intangible assets, which is recorded in both cost of revenue and operating expenses in the Unaudited Consolidated Statements of Operations depending on the functional nature of the intangible asset, was $14.5 million and $13.3 million for the three months ended March 31, 2019 and March 31, 2018, respectively. Total future amortization expense related to intangible assets subject to amortization at March 31, 2019 is set forth in the table below: ( in thousands Remaining 2019 $ 39,324 2020 51,854 2021 49,649 2022 42,185 2023 18,069 Thereafter through 2031 39,582 Total future amortization expense $ 240,663 |
Business Combinations
Business Combinations | 3 Months Ended |
Mar. 31, 2019 | |
Business Combination Description [Abstract] | |
Business Combinations | The Company recognizes the assets acquired, liabilities assumed, and any non-controlling interest at fair value at the date of acquisition. Certain acquisitions contained contingent consideration arrangements that required the Company to assess the acquisition date fair value of the contingent consideration liabilities, which was recorded as part of the purchase price allocation of the acquisition, with subsequent fair value adjustments to the contingent consideration recorded in the Unaudited Consolidated Statements of Operations. See Note 3 Acquisitions The Company has completed acquisitions that were not considered material, individually or collectively, to the overall Unaudited Consolidated Financial Statements during the periods presented. These acquisitions have been included in the Unaudited Consolidated Financial Statements from the respective dates of acquisition. The Company does not believe that collectively the acquisitions made during the periods presented are material to the overall financial statements. The Company finalizes the purchase price allocation of the assets and liabilities subject to valuation obtained in business combinations within one year from the acquisition date. While the Company does not expect material changes from the initial outcome of the valuation, certain assumptions and findings made at the date of acquisition could result in changes in the purchase price allocation. Variable Interest Entities NuVasive Clinical Services and Physician Practices The Company provides IOM services through various subsidiaries, which conduct business as NuVasive Clinical Services. In providing IOM services to surgeons and healthcare facilities across the U.S., the Company maintains contractual relationships with several physician practices (“PCs”). In accordance with authoritative guidance, the Company has determined that the PCs are variable interest entities and therefore, the accompanying Unaudited Consolidated Financial Statements include the accounts of the PCs from the date of acquisition. During the periods presented, the results of the PCs were immaterial to the Company’s financials. The creditors of the PCs have claims only on the assets of the PCs, which are not material, and the assets of the PCs are not available to the Company . |
Indebtedness
Indebtedness | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Indebtedness | The carrying values of the Company’s Senior Convertible Notes due 2021 are as follows: ( in thousands March 31, 2019 December 31, 2018 2.25% Senior Convertible Notes due 2021: Principal amount 650,000 650,000 Unamortized debt discount (35,799 ) (40,117 ) Unamortized debt issuance costs (6,594 ) (7,357 ) Total Senior Convertible Notes $ 607,607 $ 602,526 2.25% Senior Convertible Notes due 2021 In March 2016, the Company issued $650.0 million principal amount of unsecured Senior Convertible Notes with a stated interest rate of 2.25% and a maturity date of March 15, 2021 (the "2021 Notes"). The net proceeds from the offering, after deducting initial purchasers' discounts and costs directly related to the offering, were approximately $634.1 million. The 2021 Notes may be settled in cash, stock, or a combination thereof, solely at the Company's discretion. It is the Company's current intent and policy to settle all conversions through combination settlement, which involves satisfying the principal amount outstanding with cash and any note conversion value over the principal amount in shares of the Company's common stock. The initial conversion rate of the 2021 Notes is 16.7158 shares per $1,000 principal amount, which is equivalent to a conversion price of approximately $59.82 per share, subject to adjustments. The Company uses the treasury share method for assumed conversion of the 2021 Notes to compute the weighted average shares of common stock outstanding for diluted earnings per share. The Company also entered into transactions for a convertible note hedge (the "2021 Hedge") and warrants (the "2021 Warrants") concurrently with the issuance of the 2021 Notes. The cash conversion feature of the 2021 Notes required bifurcation from the notes and was initially accounted for as an equity instrument classified to stockholders’ equity, which resulted in recognizing $84.8 million in additional paid-in-capital during 2016. The interest expense recognized on the 2021 Notes during the three months ended March Prior to September 15, 2020, holders may convert their 2021 Notes only under the following conditions: (a) during any calendar quarter beginning June 30, 2016, if the reported sale price of the Company's common stock for at least 20 days out of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than 130% of the conversion price on each applicable trading day; (b) during the five business day period in which the trading price of the 2021 Notes falls below 98% of the product of (i) the last reported sale price of the Company's common stock and (ii) the conversion rate on that date; and (c) upon the occurrence of specified corporate events, as defined in the 2021 Notes. From September 15, 2020 and until the close of business on the second scheduled trading day immediately preceding March 15, 2021, holders may convert their 2021 Notes at any time (regardless of the foregoing circumstances). The Company may not redeem the 2021 Notes prior to March 20, 2019. The Company may redeem the 2021 Notes, at its option, in whole or in part on or after March 20, 2019 until the close of business on the business day immediately preceding September 15, 2020 if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company delivers written notice of a redemption. The redemption price will be equal to 100% of the principal amount of such 2021 Notes to be redeemed plus accrued and unpaid interest to, but excluding, the redemption date 2021 Hedge In connection with the offering of the 2021 Notes, the Company entered into the hedge transaction with the initial purchasers of the 2021 Notes and/or their affiliates (the "2021 Counterparties") entitling the Company to purchase up to 10,865,270 shares of the Company's common stock at an initial stock price of $59.82 per share, each of which is subject to adjustment. The cost of the 2021 Hedge was $111.2 million and accounted for as an equity instrument by recognizing $111.2 million in additional paid-in-capital during 2016. The 2021 Hedge will expire on March 15, 2021. The 2021 Hedge is expected to reduce the potential equity dilution upon conversion of the 2021 Notes if the daily volume-weighted average price per share of the Company's common stock exceeds the strike price of the 2021 Hedge. An assumed exercise of the 2021 Hedge by the Company is considered anti-dilutive since the effect of the inclusion would always be anti-dilutive with respect to the calculation of diluted earnings per share. 2021 Warrants The Company sold warrants to the 2021 Counterparties to acquire up to 10,865,270 shares of the Company’s common stock. The 2021 Warrants will expire on various dates from June 2021 through December 2021 and may be settled in cash or net shares. It is the Company's current intent and policy to settle all conversions in shares of the Company’s common stock. The Company received $44.9 million in cash proceeds from the sale of the 2021 Warrants, which was recorded in additional paid-in-capital. The 2021 Warrants could have a dilutive effect on the Company's earnings per share to the extent that the price of the Company's common stock during a given measurement period exceeds the strike price of the 2021 Warrants, which is $80.00 per share. The Company uses the treasury share method for assumed conversion of its 2021 Warrants to compute the weighted average common shares outstanding for diluted earnings per share. Revolving Senior Credit Facility In April 2017, the Company entered into an Amended and Restated Credit Agreement (the “2017 Credit Agreement”) for a revolving senior credit facility (the “2017 Facility”), which replaced the previous Credit Agreement the Company had entered into in February 2016. The 2017 Credit Agreement provides for secured revolving loans, multicurrency loan options and letters of credit in an aggregate amount of up to $500.0 million. The 2017 Credit Agreement also contains an expansion feature, which allows the Company to increase the aggregate principal amount of the 2017 Facility provided the Company remains in compliance with the underlying financial covenants, including but not limited to, compliance with the consolidated interest coverage ratio and certain consolidated leverage ratios. The 2017 Facility matures in April 2022 (subject to an earlier springing maturity date), and includes a sublimit of $100.0 million for multicurrency borrowings, a sublimit of $50.0 million for the issuance of standby letters of credit, and a sublimit of $5.0 million for swingline loans. All assets of the Company and its material domestic subsidiaries are pledged as collateral under the 2017 Facility (subject to customary exceptions) pursuant to the term set forth in the Amended and Restated Security and Pledge Agreement (the “2017 Security Agreement”) executed in favor of the administrative agent by the Company. Each of the Company’s material domestic subsidiaries guarantees the 2017 Facility. In connection with the 2017 Facility, the Company incurred issuance costs which will be amortized over the term of the 2017 Facility. Borrowings under the 2017 Facility are used by the Company to provide financing for working capital and other general corporate purposes, including potential mergers and acquisitions. Borrowings under the 2017 Facility bear interest, at the Company’s option, at a rate equal to an applicable margin plus: (a) the applicable Eurocurrency Rate (as defined in the 2017 Credit Agreement), or (b) a base rate determined by reference to the highest of (1) the federal funds effective rate plus 0.50%, (2) the Bank of America prime rate, and (3) LIBOR for an interest period of one month plus 1.00%. The margin for the 2017 Facility ranges, based on the Company’s consolidated leverage ratio, from 0.00% to 1.00% in the case of base rate loans and from 1.00% to 2.00% in the case of Eurocurrency Rate loans. The 2017 Facility includes an unused line fee ranging, based on the Company’s consolidated leverage ratio, from 0.20% to 0.35% per annum on the revolving commitment. The 2017 Credit Agreement contains affirmative, negative, permitted acquisition and financial covenants, and events of default customary for financings of this type. The financial covenants require the Company to maintain ratios of consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) in relation to consolidated interest expense and consolidated debt, respectively, as defined in the 2017 Credit Agreement. The 2017 Facility grants the lenders preferred first priority liens and security interests in capital stock, intercompany debt and all of the present and future property and assets of the Company and each guarantor. The Company is currently in compliance with the 2017 Credit Agreement covenants. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | The compensation cost that has been included in the Unaudited Consolidated Statements of Operations for all stock-based compensation arrangements was as follows: Three Months Ended March 31, ( in thousands 2019 2018 Sales, marketing and administrative expense $ 4,779 $ 3,515 Research and development expense 900 500 Cost of revenue 38 119 Stock-based compensation expense before taxes 5,717 4,134 Related income tax benefits (1,429 ) (1,034 ) Stock-based compensation expense, net of taxes $ 4,288 $ 3,100 At March 31, 2019, there was $57.9 million of unamortized compensation expense for restricted stock units (“RSUs”) and performance-based restricted stock units (“PRSUs”) to be recognized over a weighted average period of 2.6 years. Restricted Stock Units and Performance-Based Restricted Stock Units The Company issued approximately 465,000 shares of common stock, before net share settlement, upon vesting of RSUs and PRSUs during the three months ended March 31, 2019 and issued approximately 190,000 shares of common stock in settlement of RSUs and PRSUs upon their vesting during the year ended December 31, 2018. Stock Options and Purchase Rights The weighted average assumptions used to estimate the fair value of stock purchase rights under the employee stock purchase plan (“ESPP”) are as follows: Three Months Ended March 31, 2019 2018 ESPP Volatility 37 % 36 % Expected term (years) 0.5 0.5 Risk free interest rate 2.5 % 1.2 % Expected dividend yield — % — % Under the terms of the ESPP, the Company’s employees (referred to as “shareowners”) can elect to have up to 15% of their annual compensation, up to a maximum of $21,250 per year, withheld to purchase shares of the Company’s common stock for a purchase price equal to 85% of the lower of the fair market value per share (at closing) of the Company’s common stock on (i) the commencement date of the six-month offering period, or (ii) the respective purchase date. The Company has not granted any options since 2011. The Company issued approximately 6,000 shares of common stock, before net share settlement, upon the exercise of outstanding stock options during the three months ended March 31, 2019 and issued approximately 128,000 shares of common stock, before net share settlement, upon the exercise of outstanding stock options during the year ended December 31, 2018. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income taxes are determined using an estimated annual effective tax rate applied against income, and then adjusted for the tax impacts of certain significant and discrete items. For the three months ended March 31, 2019, the Company treated the tax impact of the following as discrete events for which the tax effect was recognized separately from the application of the annual effective tax rate: tax benefits related to net windfalls on share-based payments, return to provision adjustments, and tax expense related to the revaluation of deferred taxes based on changes in tax rates. The Company’s effective tax rate recorded for the three months ended March 31, 2019 was 12%. In accordance with the disclosure requirements as described in ASC Topic 740, Income Taxes, the Company has classified unrecognized tax benefits as non-current income tax liabilities, or a reduction in deferred tax assets, unless expected to be paid within one year. The Company’s continuing practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had an increase in gross unrecognized tax benefits of approximately $0.4 million during the three months ended March 31, 2019, primarily related to research and development credits. The Company believes it is reasonably possible that approximately $0.8 million of its remaining unrecognized tax positions may be recognized within the next twelve months as certain statute of limitations expire, the amount of which is primarily attributable to tax positions involving the valuation of intercompany transactions. The Company is subject to routine compliance reviews on various tax matters around the world in the ordinary course of business. Currently, the only income tax audit being conducted is in Germany. U.S. and most foreign jurisdictions remain subject to examination in all years due to prior year net operating losses or research and development credit carryforwards. |
Business Segment, Product, and
Business Segment, Product, and Geographic Information | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Business Segment, Product and Geographic Information | The Company operates in one segment based upon the Company’s organizational structure, the way in which the operations and investments are managed and evaluated by the chief operating decision maker (“CODM”) as well as the lack of availability of discrete financial information at a lower level. The Company’s CODM reviews revenue at the product line offering level, and manufacturing, operating income and expenses, and net income at the Company wide level to allocate resources and assess the Company’s overall performance. The Company shares common, centralized support functions, including finance, human resources, legal, information technology, and corporate marketing, all of which report directly to the CODM. Accordingly, decision-making regarding the Company’s overall operating performance and allocation of Company resources is assessed on a consolidated basis. As such, the Company operates as one reporting segment. The Company has disclosed the revenues for each of its product line offerings to provide the reader of the financial statements transparency into the operations of the Company. The Company reports under two distinct product lines; spinal hardware and surgical support. The Company’s spinal hardware product line offerings include implants and fixation products. The Company’s surgical support product offerings include IOM services, disposables and biologics, all of which are used to aid spinal surgery. Revenue by product line was as follows: Three Months Ended March 31, ( in thousands 2019 2018 Spinal hardware $ 197,138 $ 185,901 Surgical support 77,638 74,621 Total revenue $ 274,776 $ 260,522 Revenue and property and equipment, net, by geographic area were as follows: Revenue Property and Equipment, Net Three Months Ended March 31, March 31, December 31, ( in thousands 2019 2018 2019 2018 United States $ 222,813 $ 213,303 $ 206,780 $ 200,404 International (excludes Puerto Rico) 51,963 47,219 40,753 38,437 Total $ 274,776 $ 260,522 $ 247,533 $ 238,841 |
Commitments
Commitments | 3 Months Ended |
Mar. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments | Leases At the inception of a contractual arrangement, the Company determines whether the contract contains a lease by assessing whether there is an identified asset and whether the contract conveys the right to control the use of the identified asset in exchange for consideration over a period of time. If both criteria are met, the Company calculates the associated lease liability and corresponding right-of-use asset upon lease commencement using a discount rate based on a credit-adjusted secured borrowing rate commensurate with the term of the lease. The Company records lease liabilities within current liabilities or long-term liabilities based upon the length of time associated with the lease payments. The Company records its operating lease right-of-use assets as long-term assets. Right-of-use assets for financing leases are recorded within property and equipment, net in the Unaudited Consolidated Balance Sheet. Leases with an initial term of 12 months or less are not recorded on the Unaudited Consolidated Balance Sheet. Instead, the Company recognizes lease expense for these leases on a straight-line basis over the lease term. In connection with certain operating leases, the Company has security deposits recorded and maintained as restricted cash totaling $2.4 million as of March 31, 2019. The Company leases office and storage facilities and equipment under various operating and financing lease agreements. The initial terms of these leases range from 2 to 17 years and generally provide for periodic rent increases, and renewal and termination options. The Company’s lease agreements do not contain any material variable lease payments, residual value guarantees or material restrictive covenants. Certain leases require the Company to pay taxes, insurance, and maintenance. Payments for the transfer of goods or services such as common area maintenance and utilities represent non-lease components. The Company elected the package of practical expedients and therefore does not separate non-lease components from lease components. The Company has future lease payment obligations of approximately $53.8 million related to corporate office facilities that are in the process of being built-out prior to being leased. The lease liabilities and the corresponding right-of-use assets associated with these lease obligations will be recorded upon the commencement date of the lease. The table below summarizes the Company’s lease liabilities and corresponding right-of-use assets: (in thousands) March 31, 2019 Assets Operating $ 61,400 Financing 889 Total leased assets $ 62,289 Liabilities Current: Operating $ 6,320 Financing 380 Long-term: Operating $ 67,112 Financing 623 Total lease liabilities $ 74,435 The table below summarizes the Company’s lease costs from its Unaudited Consolidated Statement of Operations, cash payments from its Unaudited Consolidated Statement of Cash Flows, and other noncash information under its operating and financing lease obligations during the three months ended March 31, 2019: (in thousands, except years and rates) March 31, 2019 Lease expense: Operating lease expense $ 2,822 Finance lease expense: Depreciation of right-of-use assets 98 Interest expense on lease liabilities 14 Total lease expense $ 2,934 Cash payment information: Operating cash used for operating leases $ 3,019 Operating cash used for financing leases 14 Financing cash used for financing leases 92 Total cash paid for amounts included in the measurement of lease liabilities $ 3,125 Supplemental non-cash information: Operating lease liabilities arising from obtaining right-of-use assets $ 75,109 Weighted-average remaining lease term (years) - operating leases 13.0 Weighted-average remaining lease term (years) - finance leases 2.3 Weighted-average discount rate - operating leases 7.3 % Weighted-average discount rate - finance leases 4.9 % The Company’s future minimum annual lease payments under operating and financing leases at March 31, 2019 are as follows: Financing Operating (in thousands) Leases Leases Remaining 2019 $ 317 $ 8,734 2020 423 10,288 2021 325 8,133 2022 12 7,708 2023 — 7,549 Thereafter — 76,913 Total minimum lease payments $ 1,077 $ 119,325 Less: amount representing interest (74 ) (45,893 ) Present value of obligations under leases 1,003 73,432 Less: current portion (380 ) (6,320 ) Long-term capital lease obligations $ 623 $ 67,112 Executive Severance Plans The Company has employment contracts with key executives and maintains severance plans that provide for the payment of severance and other benefits if such executives are terminated for reasons other than cause, as defined in those agreements and plans. Certain agreements call for payments that are based on historical compensation, and accordingly, the amount of the contractual commitment will change over time commensurate with the executive’s applicable earnings. At March 31, 2019, future commitments for such key executives were approximately $12.6 million. In certain circumstances, the agreements call for the acceleration of equity vesting. Those figures are not reflected in the above information. |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Contingencies [Abstract] | |
Contingencies | 11. Contingencies The Company is subject to potential liabilities under government regulations and various claims and legal actions that are pending or may be asserted from time-to-time. These matters arise in the ordinary course and conduct of the Company’s business and include, for example, commercial, intellectual property, environmental, securities and employment matters. The Company intends to continue to defend itself vigorously in such matters and when warranted, take legal action against others. Furthermore, the Company regularly assesses contingencies to determine the degree of probability and range of possible loss for potential accrual in its financial statements. An estimated loss contingency is accrued in the Company’s financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Based on the Company’s assessment, it has adequately accrued an amount for contingent liabilities currently in existence. The Company does not accrue amounts for liabilities that it does not believe are probable or that it considers immaterial to its overall financial position. Litigation is inherently unpredictable, and unfavorable resolutions could occur. As a result, assessing contingencies is highly subjective and requires judgment about future events. The amount of ultimate loss may exceed the Company’s current accruals, and it is possible that its cash flows or results of operations could be materially affected in any particular period by the unfavorable resolution of one or more of these contingencies. Legal Proceedings Securities Litigation On August 28, 2013, a purported securities class action lawsuit was filed in the U.S. District Court for the Southern District of California naming the Company and certain of its current and former executive officers for allegedly making false and materially misleading statements regarding the Company’s business and financial results, specifically relating to the purported improper submission of false claims to Medicare and Medicaid. The operative complaint asserts a putative class period stemming from October 22, 2008 to July 30, 2013. The complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder and seeks unspecified monetary relief, interest, and attorneys’ fees. On February 13, 2014, Brad Mauss, the lead plaintiff in the case, filed an Amended Class Action Complaint for Violations of the Federal Securities Laws. The Company answered the complaint on August 25, 2016, and discovery commenced. The plaintiffs filed motions for class certification on October 28, 2016 and the Company’s opposition papers were filed on January 9, 2017. On March 22, 2017, the court issued an order granting class certification. The Company filed a petition to appeal the order granting class certification with the U.S. Court of Appeals for the Ninth Circuit (the “Ninth Circuit”) on April 5, 2017 and the plaintiffs filed an opposition to the petition. On August 15, 2017, the Ninth Circuit denied the Company’s petition. The Company filed a motion for summary judgment on September 8, 2017. On February 1, 2018, the court entered an order denying the Company’s motion for summary judgment. On February 13, 2018, the Company entered into a memorandum of understanding with the plaintiffs to settle the case for $7.9 million. On March 23, 2018, the parties executed a stipulation of settlement, which was preliminarily approved by the court on June 11, 2018. On December 6, 2018, the court issued an order and judgment granting final approval of the settlement. The settlement of $7.9 million was fully funded by insurance proceeds and includes the dismissal of all claims against the Company and the named individuals in the lawsuit without any liability or wrongdoing attributed to them. The Company no longer has any remaining liability related to this matter as of March 31, 2019. Madsen Medical, Inc. Litigation On February 19, 2016, an unfavorable jury verdict was delivered against the Company in its litigation in the U.S. District Court for the Southern District of California against Madsen Medical, Inc. (“MMI”), a former sales agent. Specifically, the jury awarded MMI $7.5 million in lost profits for tortious interference, $14.0 million for unjust enrichment, $20.0 million in punitive damages, and approximately $0.3 million in damages for breach of contract. he trial court entered judgment in favor of MMI in the amount of $27.8 million, which amount excluded the $14.0 million disgorgement awarded by the jury. As of December 31, 2017, the Company believed that the outcome of the case did not constitute a probable nor an estimable loss associated with the litigation, but rather a reasonably possible loss. The Company, based on its own assessment as well as that of outside counsel, believed that it was probable upon appeal the judgment would be vacated. Accordingly, the Company did not record a loss contingency at December 31, 2017, but assessed a reasonable range of potential loss, which would be from zero to the current amount entered as a judgment, as well as attorney’s fees and interest. Following the April 12, 2018 oral argument, the Company believed that the prior judgments against it, in part or as a whole, may be upheld. Accordingly, at March 31, 2018, the Company believed that the outcome of the case constituted a probable loss. While the actual amount of the probable loss was not known, the Company assessed a range of potential loss in accordance with Accounting Standards Codification 450, Contingencies, which would be from zero to $29.0 million, and recorded an additional estimated loss contingency in the amount of $29.0 million as a current litigation liability in the Unaudited Consolidated Balance Sheet as of March 31, 2018, resulting in an aggregate litigation liability of $29.0 million accrued for this matter. In May 2018, the Company entered into an agreement to settle all outstanding matters with MMI for $27.8 million. The Company has paid the settlement amount and no longer has any remaining liability related to this matter as of March 31, 2019. |
Regulatory Matters
Regulatory Matters | 3 Months Ended |
Mar. 31, 2019 | |
Regulatory Matter [Abstract] | |
Regulatory Matters | On August 31, 2015, the Company received a civil investigative demand (“CID”) issued by the Department of Justice (“DOJ”) pursuant to the federal False Claims Act. The CID requires the delivery of a wide range of documents and information related to an investigation by the DOJ concerning allegations that the Company assisted a physician group customer in submitting improper claims for reimbursement and made improper payments to the physician group in violation of the Anti-Kickback Statute. The Company is cooperating with the DOJ in regards to this matter. No assurance can be given as to the timing or outcome of this investigation. As of March 31, 2019, the probable outcome of this matter cannot be determined, nor can the Company estimate a range of potential loss. In accordance with authoritative guidance on the evaluation of loss contingencies, the Company has not recorded an accrual related to this matter. On June 9, 2017, the Company received a subpoena from the Office of the Inspector General of the U.S. Department of Health and Human Services (“OIG”) in connection with an investigation into possible false or otherwise improper claims submitted to Medicare and Medicaid. The subpoena sought discovery of documents for the period January 2014 through June 2017, primarily associated with sales to a particular customer and relationships related to that customer account. In February 2019, the Company received notice that the OIG had concluded its investigation and is not pursuing the matter further. |
Description of Business and B_2
Description of Business and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of Business | Description of Business NuVasive, Inc. (the “Company” or “NuVasive”) was incorporated in Delaware on July 21, 1997, and began commercializing its products in 2001. The Company’s principal product offering includes a minimally disruptive surgical platform called Maximum Access Surgery, or MAS. The MAS platform combines three categories of solutions that collectively minimize soft tissue disruption during spine fusion surgery, provide maximum visualization and are designed to enable safe and reproducible outcomes for the surgeon and the patient. The platform includes the Company’s proprietary software-driven nerve detection and avoidance systems and Intraoperative Monitoring (“IOM”) services and support; MaXcess, an integrated split-blade retractor system; and a wide variety of specialized implants and biologics. To assist with surgical procedures, the Company offers a technology platform called Integrated Global Alignment (“iGA”); in which products and computer assisted technology under the MAS platform help achieve more precise spinal alignment. The individual components of the MAS platform, and many of the Company’s products, can also be used in open or traditional spine surgery. The Company continues to focus research and development efforts to expand its MAS product platform and advance the applications of its unique technology into procedurally-integrated surgical solutions. The Company dedicates significant resources toward training spine surgeons on its unique technology and products. The Company’s procedurally integrated solutions use innovative, technological advancements and the MAS platform to provide surgical efficiency, operative reliability, and procedural versatility. The Company offers a range of implants for spinal surgery, which include its porous titanium and polyetheretherketone (“PEEK”) implants under its Advanced Materials Science portfolio, fixation devices such as customizable rods, plates and screws, bone allograft in patented saline packaging, allogeneic and synthetic biologics, and disposables used in IOM. The Company makes available MAS instrument sets, MaXcess and neuromonitoring systems to hospitals to facilitate surgeon access to the spine to perform restorative and fusion procedures using the Company’s implants and fixation devices. The Company sells MAS instrument sets, MaXcess and neuromonitoring systems to hospitals, however, such sales are immaterial to the Company’s results of operations. The Company also designs and sells expandable growing rod implant systems that can be non-invasively lengthened following implantation with precise, incremental adjustments via an external remote controller using magnetic technology called MAGnetic External Control, or MAGEC, which allows for the minimally invasive treatment of early-onset and adolescent scoliosis. This technology is also the basis for the Company’s Precice limb lengthening system, which allows for the correction of long bone limb length discrepancy, as well as enhanced bone healing in patients that have experienced traumatic injury. The Company continues to develop a wide variety of projects which broaden its MAS and other product platforms and advance the applications of its unique technology into procedurally integrated surgical solutions that improve clinical and economic outcomes, including Pulse, a surgical automation platform which incorporates neuromonitoring, surgical planning, rod bending, imaging, navigation, and other automation. Pulse is a combined hardware and software platform designed to achieve surgical efficiencies via real-time feedback to aid in clinical decision making and to optimize the procedural workflow in the operating room. The Company continues to pursue business and technology acquisition targets and strategic relationships. |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying Unaudited Consolidated Financial Statements include the accounts of the Company and its majority-owned or controlled subsidiaries, collectively referred to as either NuVasive or the Company. The Company translates the financial statements of its foreign subsidiaries using end-of-period exchange rates for assets and liabilities and average exchange rates during each reporting period for results of operations. When there is a portion of equity in an acquired subsidiary not attributable, directly or indirectly, to the respective parent entity, the Company records the fair value of the non-controlling interest at the acquisition date and classifies the amounts attributable to non-controlling interest separately in equity in the Company's Consolidated Financial Statements. Any subsequent changes in a parent's ownership interest while the parent retains its controlling financial interest in its subsidiary are accounted for as equity transactions. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying Unaudited Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Pursuant to these rules and regulations, the Company has condensed or omitted certain information and footnote disclosures it normally includes in its annual Consolidated Financial Statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for any other interim period or for the full year. These Unaudited Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2018 included in the Company’s Annual Report on Form 10-K filed with the SEC. In the opinion of management, the Unaudited Consolidated Financial Statements and notes thereto include all adjustments that are of a normal and recurring nature that are necessary for the fair presentation of the Company’s financial position and of the results of operations and cash flows for the periods presented. |
Use of Estimates | Use of Estimates To prepare financial statements in conformity with GAAP, management must make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. |
Recently Accounting Pronouncements Not Yet Adopted And Recently Adopted Accounting Standards | Recent Accounting Pronouncements Not Yet Adopted In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2016-13, Financial Instruments – Credit Losses This update is effective for annual periods beginning after December 15, 2019, and interim periods within those periods, and early adoption is permitted The Company believes the adoption will modify the way the Company analyzes financial instruments, but it does not anticipate a material impact on results of operations. In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles – Goodwill and Other In August 2018, the FASB issued Accounting Standards Update No. 2018-13, Fair Value Measurement: Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement adds and modifies certain disclosure requirements for fair value measurements entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, or valuation processes for Level 3 fair value measurements. However, public companies will be required to disclose the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements In September 2018, the FASB issued Accounting Standards Update No. 2018-15, Intangible – Goodwill and Other – Internal-Use Software requires a customer in a cloud computing arrangement to determine which implementation costs to capitalize as assets or expense as incurred capitalized implementation costs related to a hosting arrangement that is a service contract will be amortized over the term of the hosting arrangement, beginning when the module or component of the hosting arrangement is ready for its intended use Recently Adopted Accounting Standards In February 2016, the FASB issued Accounting Standards Update No. 2016-02 – Leases The Company adopted ASC 842 as of January 1, 2019, electing the optional transition method that allows for a cumulative-effect adjustment in the period of adoption and did not restate prior periods. The Company elected the package of practical expedients permitted under the transition guidance. As a result of the adoption, the Company recorded right-of-use assets and liabilities, and their corresponding deferred tax assets and liabilities on its Unaudited Consolidated Balance Sheet. As of March 31, 2019 the Company’s right-of-use assets and liabilities were $61.4 million and $73.4 million, respectively, associated with its operating leases. See Note 10 to the Unaudited Consolidated Financial Statements for further discussion on leases. In July 2017, the FASB issued Accounting Standards Update No. 2017-11, Earnings Per Share, Distinguishing Liabilities from Equity, Derivatives and Hedging . The Company adopted In August 2017, the FASB issued Accounting Standards Update No. 2017-12, Derivatives and Hedging The Company adopted |
Revenue Recognition | Revenue Recognition In accordance with Accounting Standards Codification 606 Revenue from Contracts with Customers Revenue from neuromonitoring services is recognized in the period the service is performed for the amount of consideration expected to be received. |
Inventory | Inventory Net inventory as of March 31, 2019 consisted of $274.8 million of finished goods, $6.5 million of work in progress and $7.2 million of raw materials. Net inventory as of December 31, 2018 consisted of $259.4 million of finished goods, $5.0 million of work in progress and $8.8 million of raw materials. Finished goods include specialized implants and disposables and are stated at the lower of cost or market determined by utilizing a standard cost method, which includes capitalized variances, which approximates the weighted average cost. Work in progress and raw materials represent the underlying material, and labor for work in progress, that ultimately yield finished goods upon completion and are subject to lower of cost or market. The Company reviews the components of its inventory on a periodic basis for excess and obsolescence and adjusts inventory to its net realizable value as necessary. |
Comprehensive Income | Comprehensive Income Comprehensive income is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Comprehensive income includes net of tax, unrealized gains or losses on the Company’s marketable securities and foreign currency translation adjustments. The cumulative translation adjustments included in accumulated other comprehensive loss were $9.1 million and $8.6 million at March 31, 2019 and December 31, 2018, respectively. |
Product Shipment Costs | Product Shipment Costs Product shipment costs, included in sales, marketing and administrative expense in the accompanying Unaudited Consolidated Statements of Operations, were $6.4 million and $5.9 million for the three months ended March 31, 2019 and March 31, 2018, respectively. The majority of the Company’s shipping costs are related to the loaning of instrument sets, which are not typically sold as part of the Company’s core sales offering. Amounts billed to customers for shipping and handling of products are reflected in revenues and are not material for any period presented . |
Business Transition Costs | Business Transition Costs The Company incurs certain costs related to acquisition, integration and business transition activities, which include severance, relocation, consulting, leasehold exit costs, third-party merger and acquisition costs, contingent consideration fair value adjustments and other costs directly associated with such activities. The Company incurred $3.8 million of such costs during the three months ended March 31, 2019, which consisted primarily of acquisition, integration and business transition activities, but also included $0.4 million of fair value adjustments on contingent consideration liabilities associated with the Company’s 2017 and 2016 acquisitions. The Company incurred $2.3 million of such costs during the three months ended March 31, 2018, which consisted primarily of acquisition, integration and business transition activities, but also included $0.1 million of fair value adjustments on contingent consideration liabilities associated with the Company’s 2017 and 2016 acquisitions. |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Consolidated Net Income (Loss) Per Share | The following table sets forth the computation of basic and diluted consolidated net income (loss) per share: Three Months Ended March 31, ( in thousands, except per share data 2019 2018 Numerator: Net income (loss) $ 9,386 $ (27,132 ) Denominator for basic and diluted net income (loss) per share: Weighted average common shares outstanding for basic 51,675 51,226 Dilutive potential common stock outstanding: Stock options and employee stock purchase plan 15 — Restricted stock units 790 — Weighted average common shares outstanding for diluted 52,480 51,226 Basic net income (loss) per share $ 0.18 $ (0.53 ) Diluted net income (loss) per share $ 0.18 $ (0.53 ) |
Anti-dilutive Common Stock Equivalents Not Included in Calculation of Net Income (Loss) Per Diluted Share | The following weighted-average outstanding common stock equivalents were not included in the calculation of net income (loss) per diluted share because their effects were anti-dilutive: Three Months Ended March 31, ( in thousands 2019 2018 Stock options, employee stock purchase plan, and restricted stock units 266 1,056 Warrants 10,865 10,865 Senior Convertible Notes 10,865 10,865 Total 21,996 22,786 |
Financial Instruments and Fai_2
Financial Instruments and Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Assets and Liabilities Measured on Recurring Basis | Cash equivalents are determined under the fair value categories as follows: Quoted Price in Significant Other Significant Active Market Observable Inputs Unobservable ( in thousands Total (Level 1) (Level 2) Inputs (Level 3) March 31, 2019: Cash equivalents: Money market funds $ 37,300 $ 37,300 $ — $ — Total cash equivalents $ 37,300 $ 37,300 $ — $ — December 31, 2018: Cash equivalents: Money market funds $ 56,000 $ 56,000 $ — $ — Total cash equivalents $ 56,000 $ 56,000 $ — $ — |
Schedule of Fair Value of Liabilities Measured on Recurring Basis Using Unobservable Inputs | The following table sets forth the changes in the estimated fair value of the Company’s liabilities measured on a recurring basis using significant unobservable inputs (Level 3): Three Months Ended March 31, ( in thousands 2019 2018 Fair value measurement at beginning of period $ 50,410 $ 67,941 Contingent consideration liability recorded upon acquisition — 6,663 Change in fair value measurement 356 149 Changes resulting from foreign currency fluctuations (59 ) 72 Contingent consideration paid or settled (1,435 ) (9,000 ) Fair value measurement at end of period $ 49,272 $ 65,825 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and intangible assets | Goodwill and intangible assets consisted of the following: Weighted- Average Amortization ( in thousands, except years Period Gross Accumulated Intangible March 31, 2019: (in years) Amount Amortization Assets, net Intangible assets subject to amortization: Developed technology 8 $ 271,748 $ (139,662 ) $ 132,086 Manufacturing know-how and trade secrets 13 30,796 (18,516 ) 12,280 Trade name and trademarks 9 25,500 (14,693 ) 10,807 Customer relationships 9 149,134 (63,644 ) 85,490 Total intangible assets subject to amortization 9 $ 477,178 $ (236,515 ) $ 240,663 Intangible assets not subject to amortization: Goodwill $ 561,235 Total goodwill and intangible assets, net $ 801,898 Weighted- Average Amortization Period Gross Accumulated Intangible December 31, 2018: (in years) Amount Amortization Assets, net Intangible assets subject to amortization: Developed technology 8 $ 271,748 $ (131,730 ) $ 140,018 Manufacturing know-how and trade secrets 13 30,814 (17,926 ) 12,888 Trade name and trademarks 9 25,500 (13,901 ) 11,599 Customer relationships 9 147,021 (59,478 ) 87,543 Total intangible assets subject to amortization 9 $ 475,083 $ (223,035 ) $ 252,048 Intangible assets not subject to amortization: Goodwill $ 561,366 Total goodwill and intangible assets, net $ 813,414 |
Schedule of changes in the carrying value of goodwill | The following table summarizes the changes in the carrying value of the Company’s goodwill: ( in thousands December 31, 2018 Gross goodwill $ 569,666 Accumulated impairment loss (8,300 ) 561,366 Changes to gross goodwill Changes resulting from foreign currency fluctuations (131 ) (131 ) March 31, 2019 Gross goodwill 569,535 Accumulated impairment loss (8,300 ) $ 561,235 |
Future amortization expense related to intangible assets | Total future amortization expense related to intangible assets subject to amortization at March 31, 2019 is set forth in the table below: ( in thousands Remaining 2019 $ 39,324 2020 51,854 2021 49,649 2022 42,185 2023 18,069 Thereafter through 2031 39,582 Total future amortization expense $ 240,663 |
Indebtedness (Tables)
Indebtedness (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Carrying Value of Senior Convertible Notes | The carrying values of the Company’s Senior Convertible Notes due 2021 are as follows: ( in thousands March 31, 2019 December 31, 2018 2.25% Senior Convertible Notes due 2021: Principal amount 650,000 650,000 Unamortized debt discount (35,799 ) (40,117 ) Unamortized debt issuance costs (6,594 ) (7,357 ) Total Senior Convertible Notes $ 607,607 $ 602,526 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Compensation Costs Included in Statement of Income for all Stock-based Compensation Arrangements | The compensation cost that has been included in the Unaudited Consolidated Statements of Operations for all stock-based compensation arrangements was as follows: Three Months Ended March 31, ( in thousands 2019 2018 Sales, marketing and administrative expense $ 4,779 $ 3,515 Research and development expense 900 500 Cost of revenue 38 119 Stock-based compensation expense before taxes 5,717 4,134 Related income tax benefits (1,429 ) (1,034 ) Stock-based compensation expense, net of taxes $ 4,288 $ 3,100 |
Weighted Average Assumptions Used to Estimate Fair Value of Stock Purchase Rights under ESPP | The weighted average assumptions used to estimate the fair value of stock purchase rights under the employee stock purchase plan (“ESPP”) are as follows: Three Months Ended March 31, 2019 2018 ESPP Volatility 37 % 36 % Expected term (years) 0.5 0.5 Risk free interest rate 2.5 % 1.2 % Expected dividend yield — % — % |
Business Segment, Product and G
Business Segment, Product and Geographic Information (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Revenue by Product Lines | Revenue by product line was as follows: Three Months Ended March 31, ( in thousands 2019 2018 Spinal hardware $ 197,138 $ 185,901 Surgical support 77,638 74,621 Total revenue $ 274,776 $ 260,522 |
Schedule of Revenue and Net Property and Equipment by Geographical Area | Revenue and property and equipment, net, by geographic area were as follows: Revenue Property and Equipment, Net Three Months Ended March 31, March 31, December 31, ( in thousands 2019 2018 2019 2018 United States $ 222,813 $ 213,303 $ 206,780 $ 200,404 International (excludes Puerto Rico) 51,963 47,219 40,753 38,437 Total $ 274,776 $ 260,522 $ 247,533 $ 238,841 |
Commitments (Tables)
Commitments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Lease Liabilities and Corresponding Right-of-use Assets | The table below summarizes the Company’s lease liabilities and corresponding right-of-use assets: (in thousands) March 31, 2019 Assets Operating $ 61,400 Financing 889 Total leased assets $ 62,289 Liabilities Current: Operating $ 6,320 Financing 380 Long-term: Operating $ 67,112 Financing 623 Total lease liabilities $ 74,435 |
Lease Costs, Cash Payments and Other Noncash Information under Operating and Financing Lease Obligations | The table below summarizes the Company’s lease costs from its Unaudited Consolidated Statement of Operations, cash payments from its Unaudited Consolidated Statement of Cash Flows, and other noncash information under its operating and financing lease obligations during the three months ended March 31, 2019: (in thousands, except years and rates) March 31, 2019 Lease expense: Operating lease expense $ 2,822 Finance lease expense: Depreciation of right-of-use assets 98 Interest expense on lease liabilities 14 Total lease expense $ 2,934 Cash payment information: Operating cash used for operating leases $ 3,019 Operating cash used for financing leases 14 Financing cash used for financing leases 92 Total cash paid for amounts included in the measurement of lease liabilities $ 3,125 Supplemental non-cash information: Operating lease liabilities arising from obtaining right-of-use assets $ 75,109 Weighted-average remaining lease term (years) - operating leases 13.0 Weighted-average remaining lease term (years) - finance leases 2.3 Weighted-average discount rate - operating leases 7.3 % Weighted-average discount rate - finance leases 4.9 % |
Future Minimum Annual Lease Payments under Operating and Financing Leases | The Company’s future minimum annual lease payments under operating and financing leases at March 31, 2019 are as follows: Financing Operating (in thousands) Leases Leases Remaining 2019 $ 317 $ 8,734 2020 423 10,288 2021 325 8,133 2022 12 7,708 2023 — 7,549 Thereafter — 76,913 Total minimum lease payments $ 1,077 $ 119,325 Less: amount representing interest (74 ) (45,893 ) Present value of obligations under leases 1,003 73,432 Less: current portion (380 ) (6,320 ) Long-term capital lease obligations $ 623 $ 67,112 |
Description of Business and B_3
Description of Business and Basis of Presentation (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Schedule Of Description Of Business And Basis Of Presentation [Line Items] | |||
Right-of-use assets | $ 61,400 | ||
Right-of-use liabilities | 73,432 | ||
Inventory, finished goods | 274,800 | $ 259,400 | |
Inventory, work in progress | 6,500 | 5,000 | |
Inventory, raw materials | 7,200 | 8,800 | |
Translation Adjustment Functional to Reporting Currency, Net of Tax | 9,100 | $ 8,600 | |
Product shipment costs | 74,494 | $ 73,814 | |
Business transition costs | 3,833 | 2,253 | |
2017 and 2016 Acquisitions [Member] | |||
Schedule Of Description Of Business And Basis Of Presentation [Line Items] | |||
Business transition costs | 400 | 100 | |
Product Shipment [Member] | |||
Schedule Of Description Of Business And Basis Of Presentation [Line Items] | |||
Product shipment costs | 6,400 | $ 5,900 | |
ASU 2016-02 [Member] | |||
Schedule Of Description Of Business And Basis Of Presentation [Line Items] | |||
Right-of-use assets | 61,400 | ||
Right-of-use liabilities | $ 73,400 |
Net Income (Loss) Per Share - C
Net Income (Loss) Per Share - Computation of Basic and Diluted Consolidated Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Numerator: | ||
Net income (loss) | $ 9,386 | $ (27,132) |
Denominator for basic and diluted net income (loss) per share: | ||
Weighted average common shares outstanding for basic | 51,675 | 51,226 |
Dilutive potential common stock outstanding: | ||
Weighted average common shares outstanding for diluted | 52,480 | 51,226 |
Basic net income (loss) per share | $ 0.18 | $ (0.53) |
Diluted net income (loss) per share | $ 0.18 | $ (0.53) |
Stock Options and Employee Stock Purchase Plan [Member] | ||
Dilutive potential common stock outstanding: | ||
Stock options and employee stock purchase plan | 15 | |
Restricted Stock Units [Member] | ||
Dilutive potential common stock outstanding: | ||
Stock options and employee stock purchase plan | 790 |
Net Income (Loss) Per Share - A
Net Income (Loss) Per Share - Anti-dilutive Common Stock Equivalents Not Included in Calculation of Net Income (Loss) Per Diluted Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of earnings per share | 21,996 | 22,786 |
Stock Options, Employee Stock Purchase Plan, and Restricted Stock Units [Member] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of earnings per share | 266 | 1,056 |
Warrants [Member] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of earnings per share | 10,865 | 10,865 |
Senior Convertible Notes [Member] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of earnings per share | 10,865 | 10,865 |
Financial Instruments and Fai_3
Financial Instruments and Fair Value Measurements (Details Textual) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2019USD ($)investment | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($)investment | |
Business Acquisition [Line Items] | |||
Net currency exchange gains (losses) from derivatives instruments | $ (300,000) | $ (300,000) | |
Unrealized loss position investment | investment | 0 | 0 | |
Impairment charges recorded for earnings | $ 0 | $ 0 | |
Contingent consideration liabilities | 6,637,000 | 7,560,000 | |
Impairment charge on strategic investment | 9,003,000 | ||
Contingent Consideration Liabilities [Member] | |||
Business Acquisition [Line Items] | |||
Contingent consideration liabilities | 49,300,000 | 50,400,000 | |
Quoted Price in Active Market (Level 1) [Member] | Convertible Notes due 2021 [Member] | |||
Business Acquisition [Line Items] | |||
Debt instrument, fair value disclosure | 723,500,000 | $ 684,800,000 | |
Foreign Exchange Forward [Member] | |||
Business Acquisition [Line Items] | |||
Notional principal amount | 28,300,000 | 26,800,000 | |
Foreign Exchange Forward [Member] | Other Current Assets or Other Current Liabilities [Member] | |||
Business Acquisition [Line Items] | |||
Fair value of derivative instrument asset (liability) | (300,000) | ||
Foreign Exchange Forward [Member] | Other (Expense) Income [Member] | |||
Business Acquisition [Line Items] | |||
Net gains (losses) recognized on derivative instruments | $ 400,000 | $ (400,000) |
Financial Instruments and Fai_4
Financial Instruments and Fair Value Measurements - Schedule of Fair Value of Assets and Liabilities Measured on Recurring Basis (Details) - Fair Value Measurements on Recurring Basis [Member] - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Cash Equivalents and Marketable Securities | ||
Total cash equivalents | $ 37,300 | $ 56,000 |
Money Market Funds [Member] | ||
Cash Equivalents and Marketable Securities | ||
Total cash equivalents | 37,300 | 56,000 |
Quoted Price in Active Market (Level 1) [Member] | ||
Cash Equivalents and Marketable Securities | ||
Total cash equivalents | 37,300 | 56,000 |
Quoted Price in Active Market (Level 1) [Member] | Money Market Funds [Member] | ||
Cash Equivalents and Marketable Securities | ||
Total cash equivalents | $ 37,300 | $ 56,000 |
Financial Instruments and Fai_5
Financial Instruments and Fair Value Measurements - Schedule of Fair Value of Liabilities Measured on Recurring Basis Using Unobservable Inputs (Details) - Contingent Consideration Liabilities [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Fair value measurement at beginning of period | $ 50,410 | $ 67,941 |
Contingent consideration liability recorded upon acquisition | 6,663 | |
Change in fair value measurement | 356 | 149 |
Changes resulting from foreign currency fluctuations | (59) | 72 |
Contingent consideration paid or settled | (1,435) | (9,000) |
Fair value measurement at end of period | $ 49,272 | $ 65,825 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Intangible assets subject to amortization: | ||
Weighted Average Amortization Period | 9 years | 9 years |
Gross Amount | $ 477,178 | $ 475,083 |
Accumulated Amortization | (236,515) | (223,035) |
Intangible Assets, net | 240,663 | 252,048 |
Intangible assets not subject to amortization: | ||
Goodwill | 561,235 | 561,366 |
Total goodwill and intangible assets, net | $ 801,898 | $ 813,414 |
Developed Technology [Member] | ||
Intangible assets subject to amortization: | ||
Weighted Average Amortization Period | 8 years | 8 years |
Gross Amount | $ 271,748 | $ 271,748 |
Accumulated Amortization | (139,662) | (131,730) |
Intangible Assets, net | $ 132,086 | $ 140,018 |
Manufacturing know-how and trade secrets [Member] | ||
Intangible assets subject to amortization: | ||
Weighted Average Amortization Period | 13 years | 13 years |
Gross Amount | $ 30,796 | $ 30,814 |
Accumulated Amortization | (18,516) | (17,926) |
Intangible Assets, net | $ 12,280 | $ 12,888 |
Trade name and trademarks [Member] | ||
Intangible assets subject to amortization: | ||
Weighted Average Amortization Period | 9 years | 9 years |
Gross Amount | $ 25,500 | $ 25,500 |
Accumulated Amortization | (14,693) | (13,901) |
Intangible Assets, net | $ 10,807 | $ 11,599 |
Customer relationships [Member] | ||
Intangible assets subject to amortization: | ||
Weighted Average Amortization Period | 9 years | 9 years |
Gross Amount | $ 149,134 | $ 147,021 |
Accumulated Amortization | (63,644) | (59,478) |
Intangible Assets, net | $ 85,490 | $ 87,543 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Schedule of Changes in the Carrying Value of Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Gross goodwill | $ 569,535 | $ 569,666 |
Accumulated impairment loss | (8,300) | (8,300) |
Goodwill | 561,235 | $ 561,366 |
Changes to gross goodwill | ||
Changes resulting from foreign currency fluctuations | (131) | |
Goodwill period increase (decrease) | $ (131) |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Details Textual) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Amortization expense related to intangible assets | $ 14.5 | $ 13.3 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Future Amortization Expense Related to Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Future amortization expense related to intangible assets | ||
Remaining 2019 | $ 39,324 | |
2020 | 51,854 | |
2021 | 49,649 | |
2022 | 42,185 | |
2023 | 18,069 | |
Thereafter through 2031 | 39,582 | |
Intangible Assets, net | $ 240,663 | $ 252,048 |
Carrying Value of Senior Conver
Carrying Value of Senior Convertible Notes (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2016 |
Debt Instrument [Line Items] | |||
Total Senior Convertible Notes | $ 607,607,000 | $ 602,526,000 | |
2.25% Senior Convertible Notes [Member] | Convertible Notes due 2021 [Member] | |||
Debt Instrument [Line Items] | |||
Principal amount | 650,000,000 | 650,000,000 | $ 650,000,000 |
Unamortized debt discount | (35,799,000) | (40,117,000) | |
Unamortized debt issuance costs | $ (6,594,000) | $ (7,357,000) |
Carrying Value of Senior Conv_2
Carrying Value of Senior Convertible Notes (Parenthetical) (Details) | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2016 |
2.25% Senior Convertible Notes [Member] | Convertible Notes due 2021 [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate on convertible notes | 2.25% | 2.25% | 2.25% |
Indebtedness (Details Textual)
Indebtedness (Details Textual) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Apr. 30, 2017USD ($) | Mar. 31, 2016USD ($)$ / shares | Mar. 31, 2019USD ($)d$ / sharesshares | Mar. 31, 2018USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2018USD ($) | |
Revolving Senior Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility, maximum borrowing capacity | $ 500,000,000 | |||||
Credit facility, expiration date | 2022-04 | |||||
Loan outstanding | $ 0 | $ 0 | ||||
Revolving Senior Credit Facility [Member] | Federal Funds Effective Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility bear interest rate | 0.50% | |||||
Revolving Senior Credit Facility [Member] | LIBOR [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility bear interest rate | 1.00% | |||||
Multicurrency Borrowings [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility, maximum borrowing capacity | $ 100,000,000 | |||||
Standby Letters of Credit [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility, maximum borrowing capacity | 50,000,000 | |||||
Swing Line Loans [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility, maximum borrowing capacity | $ 5,000,000 | |||||
2021 Warrants [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Cash proceeds from the sale of warrants | $ 44,900,000 | |||||
Warrant strike price | $ / shares | $ 80 | |||||
2021 Hedge [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Number of common stock to be purchased | shares | 10,865,270 | |||||
stock price | $ / shares | $ 59.82 | |||||
Derivative, maturity date | Mar. 15, 2021 | |||||
Minimum [Member] | Revolving Senior Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Unused line fee | 0.20% | |||||
Minimum [Member] | Revolving Senior Credit Facility [Member] | Base Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility bear interest rate | 0.00% | |||||
Minimum [Member] | Revolving Senior Credit Facility [Member] | Eurocurrency [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility bear interest rate | 1.00% | |||||
Minimum [Member] | 2021 Warrants [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Class of warrant or rights expiry month and year | 2021-06 | |||||
Maximum [Member] | Revolving Senior Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Unused line fee | 0.35% | |||||
Maximum [Member] | Revolving Senior Credit Facility [Member] | Base Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility bear interest rate | 1.00% | |||||
Maximum [Member] | Revolving Senior Credit Facility [Member] | Eurocurrency [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility bear interest rate | 2.00% | |||||
Maximum [Member] | 2021 Warrants [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Class of warrant or rights expiry month and year | 2021-12 | |||||
Additional Paid-in Capital [Member] | 2021 Hedge [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Cost of hedge transaction | $ 111,200,000 | |||||
Common Stock [Member] | Maximum [Member] | 2021 Warrants [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Number of preferred or common stock into which the warrants is converted | shares | 10,865,270 | |||||
2.25% Senior Convertible Notes [Member] | Convertible Notes due 2021 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 650,000,000 | $ 650,000,000 | $ 650,000,000 | |||
Proceeds from issuance of convertible debt, net of issuance costs | $ 634,100,000 | |||||
Interest rate on convertible notes | 2.25% | 2.25% | 2.25% | |||
Debt instrument, maturity date | Mar. 15, 2021 | |||||
Initial conversion rate adjustment, shares | 16.7158 | |||||
Principal amount of debt considered for conversion rate | $ 1,000 | |||||
Initial conversion price of convertible notes | $ / shares | $ 59.82 | |||||
Contractual coupon interest expense | $ 3,700,000 | $ 3,700,000 | ||||
Amortization of debt discount (premium) | 4,300,000 | 4,100,000 | ||||
Amortization of debt issuance costs | $ 800,000 | $ 700,000 | ||||
Effective interest rate | 5.80% | |||||
Debt redemption price percentage | 100.00% | |||||
Principal payments due | $ 0 | |||||
2.25% Senior Convertible Notes [Member] | Convertible Notes due 2021 [Member] | Scenario Two [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Consecutive trading days considered for debt conversion | d | 5 | |||||
2.25% Senior Convertible Notes [Member] | Convertible Notes due 2021 [Member] | Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of conversion price | 130.00% | |||||
2.25% Senior Convertible Notes [Member] | Convertible Notes due 2021 [Member] | Minimum [Member] | Scenario One [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Consecutive trading days considered for debt conversion | d | 20 | |||||
2.25% Senior Convertible Notes [Member] | Convertible Notes due 2021 [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of conversion price | 98.00% | |||||
2.25% Senior Convertible Notes [Member] | Convertible Notes due 2021 [Member] | Maximum [Member] | Scenario One [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Consecutive trading days considered for debt conversion | d | 30 | |||||
2.25% Senior Convertible Notes [Member] | Convertible Notes due 2021 [Member] | Additional Paid-in Capital [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Amount reclassified to stockholders' equity | $ 84,800,000 |
Stock-Based Compensation - Comp
Stock-Based Compensation - Compensation Costs Included in Statement of Income for all Stock-based Compensation Arrangements (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense before taxes | $ 5,717 | $ 4,134 |
Related income tax benefits | (1,429) | (1,034) |
Stock-based compensation expense, net of taxes | 4,288 | 3,100 |
Sales, Marketing and Administrative Expense [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense before taxes | 4,779 | 3,515 |
Research and Development Expense [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense before taxes | 900 | 500 |
Cost of Revenue [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense before taxes | $ 38 | $ 119 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details Textual) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock options granted | 0 | |
Number of common stock issued to exercise stock options | 6,000 | 128,000 |
ESPP [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Maximum percentage of annual compensation | 15.00% | |
Maximum amount withheld to purchase shares of the company | $ 21,250 | |
Percentage of issuance price of stock under the stock issuance program | 85.00% | |
ESPP offering period | 6 months | |
Performance Based Restricted Stock Units (PRSUs) [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unamortized cost related to share-based compensation | $ 57,900,000 | |
Weighted average contractual term | 2 years 7 months 6 days | |
Restricted Stock Units [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unamortized cost related to share-based compensation | $ 57,900,000 | |
Weighted average contractual term | 2 years 7 months 6 days | |
Restricted Stock Units (RSUs) and Performance-Based Restricted Stock Units (PRSUs) [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of shares of common stock issued upon vesting of RSUs and PRSUs | 465,000 | 190,000 |
Stock-Based Compensation - Weig
Stock-Based Compensation - Weighted Average Assumptions Used to Estimate Fair Value of Stock Purchase Rights under ESPP (Details) - ESPP [Member] | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Weighted average assumptions used to estimate fair value of stock options granted and stock purchase rights under ESPP | ||
Volatility | 37.00% | 36.00% |
Expected term (years) | 6 months | 6 months |
Risk free interest rate | 2.50% | 1.20% |
Income Taxes (Details Textual)
Income Taxes (Details Textual) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Income Tax Disclosure [Abstract] | |
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Percent | 12.00% |
Increase in gross unrecognized tax benefits | $ 0.4 |
Remaining unrecognized tax positions | $ 0.8 |
Business Segment, Product and_2
Business Segment, Product and Geographic Information (Details Textual) | 3 Months Ended |
Mar. 31, 2019segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 1 |
Number of reportable segments | 1 |
Business Segment, Product and_3
Business Segment, Product and Geographic Information - Schedule of Revenue by Product Lines (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Entity Wide Information Revenue From External Customer [Line Items] | ||
Total revenue | $ 274,776 | $ 260,522 |
Spinal Hardware [Member] | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Total revenue | 197,138 | 185,901 |
Surgical Support [Member] | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Total revenue | $ 77,638 | $ 74,621 |
Business Segment, Product and_4
Business Segment, Product and Geographic Information - Schedule of Revenue and Net Property and Equipment by Geographical Area (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Revenues and Net Property and Equipment by Geographical Areas [Line Items] | |||
Revenue | $ 274,776 | $ 260,522 | |
Property and Equipment, Net | 247,533 | $ 238,841 | |
United States | |||
Revenues and Net Property and Equipment by Geographical Areas [Line Items] | |||
Revenue | 222,813 | 213,303 | |
Property and Equipment, Net | 206,780 | 200,404 | |
International [Member] | |||
Revenues and Net Property and Equipment by Geographical Areas [Line Items] | |||
Revenue | 51,963 | $ 47,219 | |
Property and Equipment, Net | $ 40,753 | $ 38,437 |
Commitments (Details Textual)
Commitments (Details Textual) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Commitments And Contingencies Disclosure [Line Items] | |
Restricted cash for security deposit | $ 2.4 |
Lease, practical expedients, package | true |
Executive Severance Plans [Member] | |
Commitments And Contingencies Disclosure [Line Items] | |
Other commitments, future minimum payments, remainder of fiscal year | $ 12.6 |
Corporate Office Facilities [Member] | |
Commitments And Contingencies Disclosure [Line Items] | |
Future lease payment obligations | $ 53.8 |
Minimum [Member] | |
Commitments And Contingencies Disclosure [Line Items] | |
Initial terms of lease | 2 years |
Maximum [Member] | |
Commitments And Contingencies Disclosure [Line Items] | |
Initial terms of lease | 17 years |
Commitments - Lease Liabilities
Commitments - Lease Liabilities and Corresponding Right-of-use Assets (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Assets | |
Right-of-use assets | $ 61,400 |
Financing | 889 |
Total leased assets | 62,289 |
Current: | |
Operating | 6,320 |
Financing | 380 |
Long-term: | |
Operating | 67,112 |
Financing | 623 |
Total lease liabilities | $ 74,435 |
Commitments - Lease Costs, Cash
Commitments - Lease Costs, Cash Payments and Other Noncash Information under Operating and Financing Lease Obligations (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Lease expense: | |
Operating lease expense | $ 2,822 |
Finance lease expense: | |
Depreciation of right-of-use assets | 98 |
Interest expense on lease liabilities | 14 |
Total lease expense | 2,934 |
Operating cash used for operating leases | 3,019 |
Operating cash used for financing leases | 14 |
Financing cash used for financing leases | 92 |
Total cash paid for amounts included in the measurement of lease liabilities | 3,125 |
Operating lease liabilities arising from obtaining right-of-use assets | $ 75,109 |
Weighted-average remaining lease term (years) - operating leases | 13 years |
Weighted-average remaining lease term (years) - finance leases | 2 years 3 months 18 days |
Weighted-average discount rate - operating leases | 7.30% |
Weighted-average discount rate - finance leases | 4.90% |
Commitments - Future Minimum An
Commitments - Future Minimum Annual Lease Payments under Operating and Financing Leases (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Financing Leases | |
Remaining 2019 | $ 317 |
2020 | 423 |
2021 | 325 |
2022 | 12 |
Total minimum lease payments | 1,077 |
Less: amount representing interest | (74) |
Present value of obligations under leases | 1,003 |
Less: current portion | (380) |
Long-term capital lease obligations | 623 |
Operating Leases | |
Remaining 2019 | 8,734 |
2020 | 10,288 |
2021 | 8,133 |
2022 | 7,708 |
2023 | 7,549 |
Thereafter | 76,913 |
Total minimum lease payments | 119,325 |
Less: amount representing interest | (45,893) |
Present value of obligations under leases | 73,432 |
Less: current portion | (6,320) |
Long-term capital lease obligations | $ 67,112 |
Contingencies (Details)
Contingencies (Details) - USD ($) | Dec. 06, 2018 | Feb. 13, 2018 | Jul. 05, 2016 | Mar. 18, 2016 | Feb. 19, 2016 | Mar. 31, 2019 | Dec. 31, 2018 | May 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Loss Contingencies [Line Items] | ||||||||||
Litigation accrual | $ 2,045,000 | $ 1,415,000 | ||||||||
Securities Litigation [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Settlement agreement, consideration | $ 7,900,000 | |||||||||
Settlement funded by insurance proceeds | $ 7,900,000 | |||||||||
Madsen Medical, Inc. Litigation [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Jury award | $ 27,800,000 | |||||||||
Loss contingency, settlement agreement, court | On March 18, 2016, the trial court entered judgment in favor of MMI in the amount of $27.8 million, which amount excluded the $14.0 million disgorgement awarded by the jury. | |||||||||
Litigation accrual | $ 27,800,000 | $ 29,000,000 | ||||||||
Madsen Medical, Inc. Litigation [Member] | Minimum [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Loss contingency, estimate of possible loss | 0 | $ 0 | ||||||||
Madsen Medical, Inc. Litigation [Member] | Maximum [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Loss contingency, estimate of possible loss | $ 29,000,000 | |||||||||
Madsen Medical, Inc. Litigation [Member] | Loss Profits for Tortious Interference [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Jury award | $ 7,500,000 | |||||||||
Madsen Medical, Inc. Litigation [Member] | Unjust Enrichment [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Jury award | 14,000,000 | |||||||||
Madsen Medical, Inc. Litigation [Member] | Punitive Damages [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Jury award | 20,000,000 | |||||||||
Madsen Medical, Inc. Litigation [Member] | Damages for Breach of Contract [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Jury award | $ 300,000 | |||||||||
Madsen Medical, Inc. Litigation [Member] | Attorney Fees And Costs [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Jury award | $ 1,100,000 |