Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2021 | Oct. 29, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 000-50644 | |
Entity Registrant Name | Cutera, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 77-0492262 | |
Entity Address, Address Line One | 3240 Bayshore Blvd. | |
Entity Address, City or Town | Brisbane | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94005 | |
City Area Code | 415 | |
Local Phone Number | 657-5500 | |
Title of 12(b) Security | Common Stock ($0.001 par value) | |
Trading Symbol | CUTR | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 17,956,709 | |
Entity Central Index Key | 0001162461 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2021 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 162,486 | $ 47,047 |
Accounts receivable, net of allowance for credit losses of $1,227 and $1,598, respectively | 30,760 | 21,962 |
Inventories | 35,493 | 28,508 |
Other current assets and prepaid expenses | 13,350 | 8,779 |
Total current assets | 242,089 | 106,296 |
Property and equipment, net | 2,205 | 2,299 |
Deferred tax asset | 589 | 643 |
Operating lease right-of-use assets | 15,269 | 17,076 |
Goodwill | 1,339 | 1,339 |
Other long-term assets | 6,955 | 5,080 |
Total assets | 268,446 | 132,733 |
Current liabilities: | ||
Accounts payable | 7,259 | 6,684 |
Accrued liabilities | 44,295 | 32,295 |
Operating lease liabilities | 2,394 | 2,260 |
PPP loan payable | 0 | 3,630 |
Deferred revenue | 9,188 | 9,489 |
Total current liabilities | 63,136 | 54,358 |
Deferred revenue, net of current portion | 1,492 | 1,748 |
Operating lease liabilities, net of current portion | 14,117 | 15,950 |
PPP loan payable, net of current portion | 0 | 3,555 |
Convertible notes, net of unamortized debt issuance costs of $4,225 | 134,025 | 0 |
Other long-term liabilities | 333 | 242 |
Total liabilities | 213,103 | 75,853 |
Commitments and Contingencies (Notes 12) | ||
Stockholders’ equity: | ||
Common stock, $0.001 par value; authorized: 50,000,000 shares; issued and outstanding: 17,951,534 and 17,679,232 shares at September 30, 2021 and December 31, 2020, respectively | 18 | 18 |
Additional paid-in capital | 109,563 | 117,097 |
Accumulated deficit | (54,238) | (60,235) |
Total stockholders’ equity | 55,343 | 56,880 |
Total liabilities and stockholders’ equity | $ 268,446 | $ 132,733 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Allowance for credit loss, current | $ 1,227 | $ 1,598 |
Unamortized debt issuance costs | $ 4,225 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock issued (in shares) | 17,951,534 | 17,679,232 |
Common stock outstanding (in shares) | 17,951,534 | 17,679,232 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Net revenue: | ||||
Total net revenue | $ 57,384 | $ 39,132 | $ 165,641 | $ 97,740 |
Cost of revenue: | ||||
Total cost of revenue | 23,959 | 17,386 | 70,717 | 50,034 |
Gross profit | 33,425 | 21,746 | 94,924 | 47,706 |
Operating expenses: | ||||
Sales and marketing | 19,190 | 12,286 | 52,668 | 38,109 |
Research and development | 5,802 | 3,432 | 14,764 | 10,294 |
General and administrative | 7,807 | 7,239 | 23,633 | 23,575 |
Total operating expenses | 32,799 | 22,957 | 91,065 | 71,978 |
Income (loss) from operations | 626 | (1,211) | 3,859 | (24,272) |
Interest and other income (expense), net: | ||||
Amortization of debt issuance costs | (225) | 0 | (492) | 0 |
Interest on convertible notes | (768) | 0 | (1,737) | 0 |
Gain on extinguishment of PPP loan | 0 | 0 | 7,185 | 0 |
Other expense, net | (561) | (382) | (1,976) | (586) |
Total interest and other income (expense), net | (1,554) | (382) | 2,980 | (586) |
Income (loss) before income taxes | (928) | (1,593) | 6,839 | (24,858) |
Income tax expense | 462 | 664 | 842 | 1,207 |
Net income (loss) | $ (1,390) | $ (2,257) | $ 5,997 | $ (26,065) |
Net income (loss) per share: | ||||
Basic (USD per share) | $ (0.08) | $ (0.13) | $ 0.34 | $ (1.59) |
Diluted (USD per share) | $ (0.08) | $ (0.13) | $ 0.33 | $ (1.59) |
Weighted-average number of shares used in per share calculations: | ||||
Basic (in shares) | 17,945 | 17,603 | 17,860 | 16,368 |
Diluted (in shares) | 17,945 | 17,603 | 18,327 | 16,368 |
Total product revenue | ||||
Net revenue: | ||||
Total net revenue | $ 50,694 | $ 33,254 | $ 146,056 | $ 81,390 |
Cost of revenue: | ||||
Total cost of revenue | 20,259 | 14,017 | 59,483 | 40,326 |
Service | ||||
Net revenue: | ||||
Total net revenue | 6,690 | 5,878 | 19,585 | 16,350 |
Cost of revenue: | ||||
Total cost of revenue | $ 3,700 | $ 3,369 | $ 11,234 | $ 9,708 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ (1,390) | $ (2,257) | $ 5,997 | $ (26,065) |
Available-for-sale investments | ||||
Net change in unrealized gain (loss) on available-for-sale investments | 0 | (2) | 0 | (2) |
Reclassification adjustment for losses on investments recognized during the period | 0 | 0 | 0 | 63 |
Net change in unrealized gain (loss) on available-for-sale investments | 0 | (2) | 0 | 61 |
Other comprehensive gain (loss), net of tax | 0 | (2) | 0 | 61 |
Comprehensive income (loss) | $ (1,390) | $ (2,259) | $ 5,997 | $ (26,004) |
Consolidated Statements of Chan
Consolidated Statements of Changes In Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (loss) |
Balance (in shares) at Dec. 31, 2019 | 14,315,586 | ||||
Balance at Dec. 31, 2019 | $ 45,942 | $ 14 | $ 82,346 | $ (36,358) | $ (60) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock for employee purchase plan (in shares) | 39,248 | ||||
Issuance of common stock for employee purchase plan | 437 | 437 | |||
Exercise of stock options (in shares) | 46,878 | ||||
Exercise of stock options | 419 | 419 | |||
Issuance of common stock in settlement of restricted and performance stock unites, net of shares withheld for employee taxes (in shares) | 481,387 | ||||
Issuance of common stock in settlement of restricted and performance stock units, net of shares withheld for employee taxes | (3,340) | $ 1 | (3,341) | ||
Issuance of common stock in connection with public offering, net of offering cost of $2,303 (in shares) | 2,742,750 | ||||
Issuance of common stock in connection with public offering, net of offering cost of $2,303 | 26,495 | $ 3 | 26,492 | ||
Stock-based compensation expense | 8,057 | 8,057 | |||
Net income (loss) | (26,065) | (26,065) | |||
Net change in unrealized loss on available-for-sale investments | 61 | 61 | |||
Balance (in shares) at Sep. 30, 2020 | 17,625,849 | ||||
Balance at Sep. 30, 2020 | 52,006 | $ 18 | 114,410 | (62,423) | 1 |
Balance (in shares) at Jun. 30, 2020 | 17,567,688 | ||||
Balance at Jun. 30, 2020 | 52,499 | $ 18 | 112,644 | (60,166) | 3 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of stock options (in shares) | 750 | ||||
Exercise of stock options | 8 | 8 | |||
Issuance of common stock in settlement of restricted and performance stock unites, net of shares withheld for employee taxes (in shares) | 57,411 | ||||
Issuance of common stock in settlement of restricted and performance stock units, net of shares withheld for employee taxes | (224) | $ 0 | (224) | ||
Stock-based compensation expense | 1,982 | 1,982 | |||
Net income (loss) | (2,257) | (2,257) | |||
Net change in unrealized loss on available-for-sale investments | (2) | (2) | |||
Balance (in shares) at Sep. 30, 2020 | 17,625,849 | ||||
Balance at Sep. 30, 2020 | $ 52,006 | $ 18 | 114,410 | (62,423) | 1 |
Balance (in shares) at Dec. 31, 2020 | 17,679,232 | 17,679,232 | |||
Balance at Dec. 31, 2020 | $ 56,880 | $ 18 | 117,097 | (60,235) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock for employee purchase plan (in shares) | 38,991 | ||||
Issuance of common stock for employee purchase plan | $ 648 | 648 | |||
Exercise of stock options (in shares) | 57,498 | 57,498 | |||
Exercise of stock options | $ 1,408 | 1,408 | |||
Purchase of capped call | (16,134) | (16,134) | |||
Issuance of common stock in settlement of restricted and performance stock unites, net of shares withheld for employee taxes (in shares) | 175,813 | ||||
Issuance of common stock in settlement of restricted and performance stock units, net of shares withheld for employee taxes | (1,963) | (1,963) | |||
Stock-based compensation expense | 8,507 | 8,507 | |||
Net income (loss) | 5,997 | 5,997 | |||
Net change in unrealized loss on available-for-sale investments | $ 0 | ||||
Balance (in shares) at Sep. 30, 2021 | 17,951,534 | 17,951,534 | |||
Balance at Sep. 30, 2021 | $ 55,343 | $ 18 | 109,563 | (54,238) | 0 |
Balance (in shares) at Jun. 30, 2021 | 17,933,020 | ||||
Balance at Jun. 30, 2021 | 53,343 | $ 18 | 106,173 | (52,848) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock for employee purchase plan (in shares) | 0 | ||||
Issuance of common stock for employee purchase plan | 3 | 3 | |||
Exercise of stock options (in shares) | 3,900 | ||||
Exercise of stock options | 156 | 156 | |||
Issuance of common stock in settlement of restricted and performance stock unites, net of shares withheld for employee taxes (in shares) | 14,614 | ||||
Issuance of common stock in settlement of restricted and performance stock units, net of shares withheld for employee taxes | (511) | (511) | |||
Stock-based compensation expense | 3,742 | 3,742 | |||
Net income (loss) | (1,390) | (1,390) | |||
Net change in unrealized loss on available-for-sale investments | $ 0 | ||||
Balance (in shares) at Sep. 30, 2021 | 17,951,534 | 17,951,534 | |||
Balance at Sep. 30, 2021 | $ 55,343 | $ 18 | $ 109,563 | $ (54,238) | $ 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 5,997 | $ (26,065) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Stock-based compensation | 8,507 | 8,057 |
Depreciation and amortization | 1,014 | 1,056 |
Amortization of contract acquisition costs | 1,430 | 2,017 |
Amortization of debt issuance costs | 492 | 0 |
Impairment of capitalized cloud computing costs | 182 | 805 |
Change in deferred tax asset | 54 | (77) |
Provision for credit losses | 101 | 1,750 |
Gain on sale of property and equipment | (45) | 0 |
PPP loan forgiveness | (7,185) | 0 |
Change in right-of-use assets | 1,681 | 250 |
Other | 0 | 327 |
Changes in assets and liabilities: | ||
Accounts receivable | (8,899) | 2,209 |
Inventories | (6,926) | 4,588 |
Other current assets and prepaid expenses | (4,571) | (1,273) |
Other long-term assets | (3,487) | (1,701) |
Accounts payable | 575 | (5,886) |
Accrued liabilities | 11,782 | (5,061) |
Operating lease liabilities | (1,573) | 0 |
Deferred revenue | (557) | (2,398) |
Net cash provided by (used in) operating activities | (1,428) | (21,402) |
Cash flows from investing activities: | ||
Acquisition of property, equipment, and software | (382) | (774) |
Proceeds from disposal of property and equipment | 71 | 0 |
Proceeds from maturities of marketable investments | 0 | 19,000 |
Purchase of marketable investments | 0 | (24,411) |
Net cash used in investing activities | (311) | (6,185) |
Cash flows from financing activities: | ||
Proceeds from exercise of stock options and employee stock purchase plan | 2,056 | 856 |
Purchase of capped call | (16,134) | 0 |
Proceeds from PPP loan | 0 | 7,167 |
Proceeds from issuance of Convertible notes | 138,250 | 0 |
Payment of issuance costs of Convertible notes | (4,717) | 0 |
Proceeds from equity offering | 0 | 28,798 |
Cost of equity offering | 0 | (2,303) |
Taxes paid related to net share settlement of equity awards | (1,963) | (3,340) |
Payments on finance lease obligations | (314) | (513) |
Net cash provided by financing activities | 117,178 | 30,665 |
Net increase in cash and cash equivalents | 115,439 | 3,078 |
Cash and cash equivalents at beginning of period | 47,047 | 26,316 |
Cash and cash equivalents at end of period | 162,486 | 29,394 |
Supplemental disclosure of non-cash items: | ||
Assets acquired under finance lease | 271 | 27 |
Assets acquired under operating lease | 123 | 10,623 |
Gain on extinguishment of PPP loan | 7,185 | 0 |
Supplemental disclosure of cash flow information: | ||
Income tax paid | $ 763 | $ 0 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes In Stockholders' Equity (Parenthetical) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Common Stock | |
Stock issued, offering cost | $ 2,303 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Description of Operations and Principles of Consolidation Cutera, Inc. (“Cutera” or the “Company”) provides energy-based aesthetic systems for practitioners worldwide. The Company develops, manufactures, distributes, and markets energy-based product platforms for use by physicians and other qualified practitioners, enabling them to offer safe and effective aesthetic treatments to their customers. The Company currently markets the following system platforms: enlighten, excel, Secret PRO, Secret RF, truSculpt and xeo . Several of the Company’s systems offer multiple hand pieces and applications, providing customers the flexibility to upgrade their systems. The sales of (i) systems, system upgrades, and hand pieces (collectively “Systems” revenue); (ii) replacement hand pieces, Titan, truSculpt 3 D,truSculpt iD and truSculpt flex cycle refills, as well as single use disposable tips applicable to Secret PRO and Secret RF (“Consumables” revenue); (iii) the distribution of third party manufactured skincare products (“Skincare” revenue); and (iv) the leasing of equipment through a membership program; are collectively classified as “Products” revenue. In addition to Product revenue, the Company generates revenue from the sale of post-warranty service contracts, parts, detachable hand piece replacements (except for Titan, truSculpt 3D, truSculpt iD and truSculpt flex) and service labor for the repair and maintenance of products that are out of warranty, all of which are collectively classified as “Service” revenue. The Company’s corporate headquarters and U.S. operations are located in Brisbane, California, where the Company conducts manufacturing, warehousing, research and development, regulatory, sales and marketing, service, and administrative activities. The Company also maintains regional distribution centers (“RDCs”) in select locations across the U.S. These RDCs serve as forward warehousing for systems and service parts in various geographies. The Company markets, sells and services its products through its sales and service employees in North America (including Canada), Australia, Austria, Belgium, France, Germany, Hong Kong, Japan, the Netherlands, Spain, Switzerland, and the United Kingdom. Sales and services outside of these direct markets are made through a worldwide distributor network in over 42 countries. The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. Basis of Presentation In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements included in this report reflect all adjustments necessary for a fair statement of its condensed consolidated statements of financial position as of September 30, 2021 and December 31, 2020, and its condensed consolidated statements of results of operations, comprehensive income (loss), changes in equity, and cash flows for the three and nine months ended September 30, 2021, and 2020. The December 31, 2020 condensed consolidated balance sheet was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). The results for interim periods are not necessarily indicative of results for the entire year or any other interim period. Presentation of certain prior year balances have been updated to conform with current year presentation. All significant intercompany accounts and transactions have been eliminated upon consolidation. The accompanying condensed consolidated financial statements should be read in conjunction with the Company’s previously filed audited financial statements and the related notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2020 filed with the Securities and Exchange Commission (the “SEC”) on March 23, 2021. Risks and Uncertainties The Company's future results of operations involve a number of risks and uncertainties. Factors that could affect the Company's future operating results and cause actual results to vary materially from expectations include, but are not limited to, rapid technological change, continued acceptance of the Company's products, stability of global financial markets, cybersecurity breaches and other disruptions that could compromise the Company’s information or results, business disruptions that are caused by natural disasters or pandemic events, management of international activities, competition from substitute products and larger companies, ability to obtain and maintain regulatory approvals, government regulations and oversight, patent and other types of litigation, ability to protect proprietary technology from counterfeit versions of the Company's products, strategic relationships and dependence on key individuals. In March 2020, the World Health Organization declared the COVID-19 outbreak a pandemic. The COVID-19 outbreak has negatively affected the United States and global economies. Though the economy is gradually recovering as of the third quarter of 2021, the timing and extent of a full global economic recovery is still uncertain. The spread of the coronavirus and the Delta variant in particular, has impacted the global economy broadly in 2020 and 2021, including restrictions on travel, shifting work forces to work remotely and quarantine policies put into place by businesses and governments, had a material economic effect on the Company’s business during the year ended December 31, 2020 and in the nine months ended September 30, 2021. Healthcare facilities in many countries effectively banned elective procedures and this had a significant impact on the Company. Many of the Company’s products are used in aesthetic elective procedures and as such, the bans on elective procedures substantially reduced the Company’s sales and marketing efforts in the early months of the pandemic and led the Company to implement cost control measures. Although the Company’s revenues and profits have improved compared to the first three quarters of fiscal 2020 and the overall economic outlook has also improved in 2021, the COVID-19 outbreak continues to be fluid especially in light of the Delta variant, and the long-term impact on the Company's business due to COVID-19 is still uncertain. The Company cannot presently predict the scope and severity of any impacts in future periods from business shutdowns or disruptions due to the COVID-19 pandemic, but the impact on economic activity including the possibility of recession or financial market instability could have a material adverse effect on the Company’s business, revenue, operating results, cash flows and financial condition. The Company continues to assess whether any impairment of its goodwill or its long-lived assets has occurred and has determined that no charges were necessary during the nine months ended September 30, 2021, other than an impairment loss of $0.2 million on capitalized costs of cloud-based customer relationship management ("CRM") software. The Company will continue to monitor future conditions important to its assessment of potential impairment of its long-lived assets and goodwill, including the impacts of the COVID–19 pandemic and other ongoing impacts which are subject to uncertainty. The Company has experienced a significant increase in sales of skincare products under the exclusive distribution agreement with ZO Skin Health, Inc. (“ZO”), which allows the Company to sell ZO’s skincare products in Japan. The reason for the increase in skincare products sales may have been the result of the COVID-19 pandemic changing customers’ spending habits, resulting in customers purchasing aesthetic treatments that were able to be applied at home, due to limitations on in-person aesthetic procedures. Future growth in sales of skincare products depends on customers maintaining spending habits adopted during the COVID-19 pandemic. If customers revert to original spending habits after the COVID-19 pandemic, such changes may have a material adverse effect on the Company’s revenue, operating results, and cash flows. Accounting Policies These unaudited condensed consolidated financial statements are prepared in accordance with the rules and regulations of the SEC applicable to interim financial statements. While these statements reflect all normal recurring adjustments that are, in the opinion of management, necessary for fair presentation of the results of the interim period, they do not include all of the information and footnotes required by GAAP for complete financial statements. These condensed consolidated financial statements should be read in conjunction with the financial statement disclosures in its annual report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 23, 2021. The Company uses the same accounting policies in preparing quarterly and annual financial statements. Unless otherwise noted, amounts presented within the notes to condensed consolidated financial statements refer to the Company’s continuing operations. Note 13 provides information about the Company’s adoption of the new accounting standard for debt with conversion and other options, which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. The Company issued $138.3 million of convertible senior notes ("Notes" or "Convertible notes") in a private placement offering on March 5, 2021. The Convertible notes bear interest at a rate of 2.25% per year. In accordance with Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-6, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity ’ s Own Equity (Subtopic 815-40), the Company recorded the Convertible notes as long-term debt with no separation between the Convertible notes and the conversion option. Each reporting period, the Company will determine whether any criteria is met for the note holders to have the option to redeem the Convertible notes early, which may result in a change in the classification of the Convertible notes to current liabilities. The circumstances described in the paragraph above were met during the second and third quarters of 2021, as the Company's stock traded at a price in excess of the conversion price. As a result, the Notes were convertible at the option of the holder from July 1, 2021 until September 30, 2021, and are currently convertible from October 1, 2021 until December 31, 2021. Upon any conversion of the Convertible notes, the Company would be required to pay or deliver, as the case may be, cash, shares of its common stock, or a combination of cash and shares of its common stock, at the Company’s election. The Company did not receive any conversion requests in the three months ended September 30, 2021. To the extent there are any conversion requests during the period from October 1, 2021 until December 31, 2021, the Company intends to settle such conversion requests by issuing shares of common stock. Therefore, as of September 30, 2021, the Convertible notes have been included as long-term liability on the condensed consolidated balance sheet. The costs associated with issuance of the Convertible notes, including underwriters’ fees, are presented in the condensed consolidated balance sheet as a direct deduction from the carrying amount of the Convertible notes. The debt issuance costs are being amortized over the life of the Convertible notes as additional non-cash interest expense. In connection with issuance of the Convertible notes, the Company entered into capped call transactions with certain option counterparties. The capped call transactions are generally designated to reduce the potential dilution of the Company's common stock upon any conversion of the Notes. The capped calls were purchased for $16.1 million and recorded as a reduction to additional paid in capital in the condensed consolidated balance sheet as of September 30, 2021. The Company capitalized cloud computing systems implementation costs of $1.2 million and $1.8 million during the three and nine months ended September 30, 2021, respectively. These costs relate to an on-going implementation of a new Enterprise Resource Planning system and are included in Other long-term assets and Other current assets and prepaid expenses on the condensed consolidated balance sheet. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the amounts reported of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the accompanying notes, and the reported amounts of revenue and expenses during the reported periods. Actual results could differ materially from those estimates. On an ongoing basis, management evaluates its estimates, including those related to warranty obligations, sales commission, allowance for credit losses, sales allowances, valuation of inventories, fair value of goodwill, useful lives of property and equipment, impairment testing for long-lived-assets, implicit and incremental borrowing rates related to the Company’s leases, variables used in calculating the fair value of the Company's equity awards, expected achievement of performance based vesting criteria, management performance bonuses, assumptions used in operating and sales-type lease classification, the standalone selling price of the Company's products and services, the period of benefit used to capitalize and amortize contract acquisition costs, variable consideration, contingent liabilities, recoverability of deferred tax assets, residual value of leased equipment, lease term and effective income tax rates. Management bases estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Recently Adopted Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12 Income Taxes (Topic 740)-Simplifying the Accounting for Income Taxes , to remove certain exceptions and improve consistency of application, including, among other things, requiring that an entity reflect the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. The Company adopted this guidance in the three and nine months ended September 30, 2021. The adoption of this guidance did not have a material impact on the Company’s consolidated financial position and results of operations. In August 2020, the FASB issued ASU No. 2020-6, Debt – Debt with Conversion and Other Options (Topic 470) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Topic 815), to simplify the accounting for convertible debt instruments by removing the beneficial conversion and cash conversion separation models for convertible instruments. Under the amendment, the embedded conversion features are no longer separated from the host contract for convertible instruments with conversion features that are not required to be accounted for as derivatives or that do not result in substantial premiums accounted for as paid-in capital. The update also amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of specific settlement provisions. In addition, the new guidance modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the computation of diluted earnings per share. The Company early adopted the guidance on a prospective basis effective January 1, 2021. See Note 13 – Debt. |
Cash, Cash Equivalents
Cash, Cash Equivalents | 9 Months Ended |
Sep. 30, 2021 | |
Cash and Cash Equivalents [Abstract] | |
Cash, Cash Equivalents | Cash, Cash Equivalents The following table summarizes the Company's cash and cash equivalents (in thousands): (Dollars in thousands) September 30, December 31, Cash and cash equivalents $ 162,486 $ 47,047 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company measures certain financial assets at fair value, including cash and cash equivalents. The fair value hierarchy contains the following three levels of inputs that may be used to measure fair value, in accordance with ASC 820: • Level 1: inputs, which include quoted prices in active markets for identical assets or liabilities; • Level 2: inputs, which include observable inputs other than Level 1 inputs, such as quoted prices for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability. When sufficient quoted pricing for identical securities is not available, the Company uses market pricing and other observable market inputs for similar securities obtained from various third-party data providers. These inputs either represent quoted prices for similar assets in active markets or have been derived from observable market data; and • Level 3: inputs, which include unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the underlying asset or liability. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies, or similar valuation techniques, as well as significant management judgment or estimation. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considering counterparty credit risk in its assessment of fair value. See Note 13 - Debt for the carrying amount and estimated fair value of the Company’s Convertible notes due 2026. |
Balance Sheet Details
Balance Sheet Details | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Details | Balance Sheet Details Inventories As of September 30, 2021 and December 31, 2020, inventories consist of the following (in thousands): September 30, December 31, Raw materials $ 18,858 $ 14,874 Work in process 1,978 1,030 Finished goods 14,657 12,604 Total $ 35,493 $ 28,508 Accrued Liabilities As of September 30, 2021 and December 31, 2020, accrued liabilities consist of the following (in thousands): September 30, December 31, Bonus and payroll-related accruals $ 18,220 $ 12,197 Sales and marketing accruals 3,515 2,352 Accrued inventory in transit 4,623 2,476 Product warranty 3,926 4,124 Accrued sales tax 7,085 5,343 Other accrued liabilities 6,926 5,803 Total $ 44,295 $ 32,295 |
Product Warranty
Product Warranty | 9 Months Ended |
Sep. 30, 2021 | |
Product Warranties Disclosures [Abstract] | |
Product Warranty | Product Warranty The Company has a direct field service organization in North America (including Canada). Internationally, the Company provides direct service support in Australia, Austria, Belgium, France, Germany, Hong Kong, Japan, the Netherlands, Spain, Switzerland, and the United Kingdom. In several other countries, where the Company does not have a direct presence, the Company provides service through a network of distributors and third-party service providers. After the original warranty period, maintenance and support are offered on an extended service contract basis or on a time and materials basis. The Company provides the estimated cost to repair or replace products under standard warranty at the time of sale. Costs incurred in connection with extended service contracts are generally recognized at the time when costs are incurred. The following table provides the changes in the product warranty accrual for the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Beginning Balance $ 4,438 $ 4,815 $ 4,124 $ 6,400 Add: Accruals for warranties issued during the period 803 1,274 3,970 3,234 Less: Settlements made during the period (1,315) (1,668) (4,168) (5,213) Ending Balance $ 3,926 $ 4,421 $ 3,926 $ 4,421 |
Deferred Revenue
Deferred Revenue | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Deferred Revenue | Deferred Revenue The Company records deferred revenue when revenue is to be recognized subsequent to invoicing. For extended service contracts, the Company generally invoices customers at the beginning of the extended service contract term. The Company’s extended service contracts typically have one two The following table provides changes in the deferred revenue balance for the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Beginning balance $ 11,403 $ 11,779 $ 11,237 $ 14,222 Add: Payments received 3,880 3,854 13,226 9,314 Less: Revenue (2,576) (762) (4,851) (2,342) Less: Revenue recognized from beginning balance (2,027) (3,047) (8,932) (9,370) Ending balance $ 10,680 $ 11,824 $ 10,680 $ 11,824 Costs for extended service contracts were $2.1 million and $6.3 million for the three and nine months ended September 30, 2021, respectively, and were $1.9 million and $5.6 million for the three and nine months ended September 30, 2020, respectively. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for promised goods or services. The Company’s performance obligations are satisfied either over time or at a point in time. Revenue from performance obligations that are transferred to customers over time accounted for approximately 12% of the Company's total revenue for the three and nine months ended September 30, 2021, and 15% and 17% of the Company's total revenue for the three and nine months ended September 30, 2020, respectively. The Company has certain systems sales arrangements that contain multiple products and services. For these bundled sale arrangements, the Company accounts for individual products and services as separate performance obligations if they are distinct. The Company’s products and services are distinct if a customer can benefit from the product or service on its own or with other resources that are readily available to the customer, and if the Company’s promise to transfer the products or service to the customer is separately identifiable from other promises in the sale arrangements. The Company’s system sale arrangements can include all or a combination of the following performance obligations: the system and software license (considered as one performance obligation), system accessories (hand pieces), training, other accessories, extended service contracts, marketing services, and time and materials services. For the Company’s system sale arrangements that include an extended service contract, the period of service commences at the expiration of the Company’s standard warranty offered at the time of the system sale. The Company considers the extended service contracts terms in the arrangements that are legally enforceable to be performance obligations. Other than extended service contracts and marketing services, which are satisfied over time, the Company generally satisfies all performance obligations at a point in time. Systems, system accessories (hand pieces), service contracts, training, and time and materials services are also sold on a stand-alone basis, and these performance obligations are satisfied at a point in time. For contracts with multiple performance obligations, the Company allocates the transaction price of the contract to each performance obligation on a relative standalone selling price basis. Significant Judgments The determination of whether two or more contracts entered into at or near the same time with the same customer should be combined and accounted for as one contract may require the use of significant judgment. In making this determination, the Company considers whether the contracts are negotiated as a package with a single commercial objective, have price interdependencies, or promise goods or services that represent a single performance obligation. While the Company’s purchase agreements do not provide customers with a contractual right of return, the Company maintains a sales allowance to account for potential returns or refunds as a reduction in transaction price at the time of sale. The Company estimates sales returns and other variable consideration based on historical experience. The Company determines the standalone selling price ("SSP") for each performance obligation as follows: • Systems: The SSPs for systems are based on directly observable sales in similar circumstances to similar customers. • Extended warranty/Service contracts: SSP is based on observable price when sold on a standalone basis (by customer type). Nature of Products and Services Systems Systems revenue is generated from the sale of systems and from the sale of upgrades to existing systems. A system consists of a console that incorporates a universal graphic user interface, a laser or other energy-based module, control system software and high voltage electronics, as well as one or more hand pieces. In certain applications, the laser or other energy-based module is contained in the hand piece, such as with the Company’s Pearl and Pearl Fractional applications, rather than within the console. The system or upgrade and the right to use the embedded software represent a single performance obligation as the software license is integral to the functionality of the system or upgrade. For systems sold directly to end-customers that are credit approved, revenue is recognized when the Company transfers control to the end-customer, which occurs when the product is shipped to the customer or when the customer receives the product, depending on the nature of the arrangement. When collectability is not established in advance of receipt of payment from the customer, revenue is recognized upon the later of the receipt of payment or the satisfaction of the performance obligation. For systems sold through credit approved distributors, revenue is recognized upon shipment to the distributor. The Company typically receives payment for its system consoles and other accessories within 30 days of shipment. Certain international distributor arrangements allow for longer payment terms. Skincare products The Company sells third-party manufactured skincare products in Japan. The skincare products are purchased from a third-party manufacturer and sold to medical offices and licensed physicians. The Company warrants that the skincare products are free of significant defects in workmanship and materials for 90 days from shipment. The Company acts as the principal in this arrangement, as the Company determines the price to charge customers for the skincare products and controls the products before they are transferred to the customer. The Company recognizes revenue for skincare products upon shipment. Consumables and other accessories The Company classifies its customers' purchases of replacement cycles for truSculpt iD and truSculpt flex, as well as replacement hand pieces, Titan and truSculpt 3D hand pieces, and single use disposable tips applicable to Secret PRO, and Secret RF, as Consumable revenue, which provides the Company with a source of recurring revenue from existing customers. The Secret RF product single use disposable tips must be replaced after every treatment. The Company’s systems offer multiple hand pieces and applications, which allow customers to upgrade their systems. Equipment leasing The Company leases equipment to customers through membership programs and receives a fixed monthly fee over the term of the arrangement. The Company classifies its lease income as product revenue. The Company recognizes lease income over the term of the lease if the lease is classified as an operating lease. For agreements that grant customers the right to purchase the leased system, the Company typically classifies the lease as a sales-type lease as the Company has determined it is reasonably certain that the customer will exercise the purchase option. On the commencement of sales-type leases, the Company recognizes revenue upfront in product revenue and the corresponding receivables is classified in Other current assets and prepaid expenses on the condensed consolidated balance sheets (See Note 11 - Leases). There were no sales-type leases during the three and nine months ended September 30, 2021 or 2020. Operating lease income was not material for the three and nine months ended September 30, 2021 or 2020. Extended contract services The Company offers post-warranty services to its customers through extended service contracts that cover parts and labor for terms of one two Training Sales of systems to customers include training on the use of the system to be provided within 180 days of purchase. The Company considers training a separate performance obligation as customers can immediately benefit from the training together with the customer’s system. Training is also sold separately from systems. The Company recognizes revenue for training when the training is provided. Training is not required for customers to use the systems. Loyalty Program The Company has a customer loyalty program for qualified customers located in the U.S., Canada, Australia and New Zealand. Under the loyalty program, based on their purchasing levels, customers accumulate points that can be redeemed for such rewards as the right to attend the Company’s advanced training event for truSculpt , or a ticket for the Company’s annual forum. A customer’s account must be in good standing to receive the benefits of the rewards program. Rewards are earned on a quarterly basis and must be used in the following quarter. All unused rewards are forfeited. The fair value of the reward earned by loyalty program members is included in accrued liabilities and recorded as a reduction of net revenue at the time the reward is earned. As of September 30, 2021 and December 31, 2020, the liability for the loyalty program included in accrued liabilities was $0.4 million and $0.3 million, respectively. Deferred Sales Commissions Incremental costs of obtaining a contract, which consist primarily of commissions and related payroll taxes, are deferred and amortized on a straight-line basis over an expected period of benefit estimated to be two Total capitalized costs as of September 30, 2021 and December 31, 2020 were $3.8 million and $3.4 million, respectively, and are included in Other long-term assets in the Company’s condensed consolidated balance sheet. Amortization expense for these assets was $0.4 million and $1.4 million during the three and nine months ended September 30, 2021, respectively, and was $0.6 million and $2.0 million during the three and nine months ended September 30, 2020, respectively. The amortization related to these capitalized costs is included in sales and marketing expense in the Company’s condensed consolidated statement of operations. |
Stockholders' Equity and Stock-
Stockholders' Equity and Stock-based Compensation Expense | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stockholders' Equity and Stock-based Compensation Expense | Stockholders ’ Equity and Stock-based Compensation Expense The Company’s equity incentive plans are broad-based, long-term programs intended to attract and retain talented employees and align stockholder and employee interests. In September 2021, stockholders approved an additional 450,000 shares for future grants. The 2019 Plan provides for the grant of incentive stock options, non-statutory stock options, restricted stock units (“RSUs”), performance stock units ("PSUs"), and other stock or cash awards. The Company’s Board of Directors granted the Company's executive officers, senior management and certain employees 463,593 PSUs during the nine months ended September 30, 2021. Of this total, 198,591 units vest subject to the Company’s achievement of certain operational goals for the 2021 fiscal year related to product milestones, sales and commercial milestones and certain cost reduction targets. In addition, there is a service requirement related to half of the granted quantity that requires the grant recipient to provide one year of service subsequent to the milestone achievement date. In July 2021, the Company granted 265,002 units to certain employees. This grant consists of four separate vesting quantities that will vest from April 2023 through June 2024 upon the achievement of milestones associated with each vesting quantity and continued service. Activity under the Company's equity incentive plans is summarized as follows: Shares Balance, December 31, 2020 1,085,170 Additional shares reserved 450,000 RSUs granted (213,522) PSUs granted (463,593) Options granted (172,139) Stock awards canceled / forfeited / expired 295,392 Options canceled / forfeited / expired 24,090 Balance, September 30, 2021 1,005,398 Options Outstanding Number of Weighted- Weighted Average Remaining Term Balance, December 31, 2020 217,007 $ 22.35 3.75 Options granted 172,139 $ 30.71 Options exercised (57,498) $ 24.49 Options canceled / forfeited / expired (24,090) $ 32.90 Balance, September 30, 2021 307,558 $ 25.80 4.84 Stock Awards Outstanding Number of Awards Outstanding Weighted Average Grant Date Fair Value per Share Balance, December 31, 2020 779,757 $ 23.96 RSUs granted 213,522 $ 36.80 PSUs granted 463,593 $ 41.23 Awards released (175,813) $ 22.45 Stock awards canceled / forfeited / expired (298,028) $ 27.24 Balance, September 30, 2021 983,031 $ 33.91 Stock-based Compensation Expense Stock-based compensation expense by department recognized during the three and nine months ended September 30, 2021 and 2020 was as follows (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Cost of revenue $ 330 $ 326 $ 908 $ 1,359 Sales and marketing 711 648 1,954 2,618 Research and development 1,020 254 1,628 1,344 General and administrative 1,681 754 4,017 2,736 Total stock-based compensation expense $ 3,742 $ 1,982 $ 8,507 $ 8,057 |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | Net Income (Loss) Per Share On January 1, 2021, the Company adopted the accounting standard update to simplify the accounting for convertible debt instruments. The Company now uses the if converted method for its Convertible notes in calculating the diluted net income (loss) per share, and includes the effect of potential share settlement for the Convertible notes, if the effect is dilutive. Basic earnings per share (“EPS”) is computed based on the weighted average number of shares of common stock outstanding during the period. Diluted EPS is computed based on the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method and the if-converted method. Dilutive potential common shares include outstanding stock options, restricted stock units, performance stock units, ESPP shares and conversion shares under the Convertible notes. The diluted EPS is computed with the assumption that the Company will settle the convertible debt in shares, rather than cash. As of September 30, 2021, the Company’s Convertible notes were potentially convertible into 4,167,232 shares of common stock. The Company used the if-converted method to calculate the potential dilutive effect of the conversion spread on diluted net income per share for the nine months ended September 30, 2021. The denominator for diluted net income (loss) per share does not include any effect from the capped call transactions the Company entered into concurrently with the issuance of the Convertible notes, as this effect would be anti-dilutive. In the event of conversion of a Convertible note, shares delivered to the Company under the capped call will offset the dilutive effect of the shares that the Company would issue under the Convertible notes. In the three and nine months ended September 30, 2021, the “if-converted method” was not applied as the effect would have been anti-dilutive. For the three and nine months ended September 30, 2020, and the three months ended September 30, 2021, basic loss per common share and diluted loss per common share are the same in each respective period as the inclusion of any potentially issuable shares would be anti-dilutive. The following table sets forth the computation of basic and diluted net income (loss) and the weighted average number of shares used in computing basic and diluted net income (loss) per share (in thousands, except per share data): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Numerator: Net income (loss) used in calculating net income (loss) per share, basic and diluted $ (1,390) $ (2,257) $ 5,997 $ (26,065) Denominator: Weighted average shares of common stock outstanding used in computing net income (loss) per share, basic 17,945 17,603 17,860 16,368 Dilutive effect of incremental shares and share equivalents: Options — — 70 — RSUs — — 297 — PSUs — — 81 — ESPP — — 19 — Weighted average shares of common stock outstanding used in computing net income (loss) per share, diluted 17,945 17,603 18,327 16,368 Net income (loss) per share: Net income (loss) per share, basic $ (0.08) $ (0.13) $ 0.34 $ (1.59) Net income (loss) per share, diluted $ (0.08) $ (0.13) $ 0.33 $ (1.59) The following numbers of shares outstanding, prior to the application of the treasury stock method and the if-converted method, were excluded from the computation of diluted net income (loss) per common share for the periods presented because including them would have had an anti-dilutive effect (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Capped call 4,167 — 4,167 — Convertible notes 4,167 — 4,167 — Options to purchase common stock 308 232 187 246 Restricted stock units 528 733 72 735 Performance stock units 455 24 24 83 Employee stock purchase plan shares 22 17 — 57 Total 9,647 1,006 8,617 1,121 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For the three and nine months ended September 30, 2021, the Company's income tax expense was $0.5 million and $0.8 million, respectively, compared to $0.7 million and $1.2 million for the three and nine months ended September 30, 2020, respectively. The Company's income tax expense for the three and nine months ended September 30, 2021 is due primarily to income taxes in foreign jurisdictions. The PPP loan forgiveness recognized during the nine months ended September 30, 2021 is excluded from taxable income under Section 1106(i) of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). The Company continues to maintain a full valuation allowance on its U.S. deferred tax assets. On March 27, 2020 , the U.S. federal government enacted the CARES Act, which changed several of the existing U.S. corporate income tax laws by, among other things, increasing the amount of deductible interest, allowing companies to carry back certain Net Operating Losses (“NOLs”) and increasing the amount of NOLs that corporations can use to offset income. The CARES Act did not have a material impact on the Company's income tax provision, deferred tax assets and liabilities, and related taxes |
Leases
Leases | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Leases | Leases The Company is a party to certain operating and finance leases for vehicles, office space and storage facilities. The Company’s operating leases consist of office space, as well as storage facilities and finance leases consist of automobiles. The Company’s leases generally have remaining terms of one The Company determines if a contract contains a lease at inception. Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent the right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of lease payments not yet paid, the Company estimates the incremental secured borrowing rates corresponding to the maturities of the leases. The Company based the rate estimates on prevailing financial market conditions, credit analysis, and management judgment. The Company recognizes expense for these leases on a straight-line basis over the lease term. Additionally, tenant incentives used to fund leasehold improvements are recognized when earned and reduce the Company’s right-of-use (“ROU”) asset related to the lease. These are amortized through the ROU asset as reductions of expense over the lease term. Supplemental balance sheet information related to leases was as follows (in thousands): Leases Classification September 30, December 31, Assets Right-of-use assets Operating lease assets $ 15,269 $ 17,076 Finance lease Property and equipment, net 377 467 Total leased assets $ 15,646 $ 17,543 Liabilities Classification September 30, December 31, Operating lease liabilities Operating lease liabilities, current Operating lease liabilities $ 2,394 $ 2,260 Operating lease liabilities, non-current Operating lease liabilities, net of current portion 14,117 15,950 Total Operating lease liabilities $ 16,511 $ 18,210 Finance lease liabilities Finance lease liabilities, current Accrued liabilities $ 497 $ 370 Finance lease liabilities, non-current Other long-term liabilities 333 242 Total Finance lease liabilities $ 830 $ 612 Lease costs during the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended Nine Months Ended Lease costs Classification 2021 2020 2021 2020 Finance lease cost Amortization expense $ 103 $ 121 $ 340 $ 545 Finance lease cost Interest for finance lease $ 12 $ 14 $ 40 $ 49 Operating lease cost Operating lease expense $ 882 $ 752 $ 2,641 $ 2,208 Cash paid for amounts included in the measurement of lease liabilities during the nine months ended September 30, 2021 and 2020 was as follows (in thousands): Nine Months Ended September 30, Cash paid for amounts included in the measurement of lease liabilities Classification 2021 2020 Operating cash flow Finance lease $ 38 $ 49 Financing cash flow Finance lease $ 314 $ 513 Operating cash flow Operating lease $ 2,324 $ 1,987 Facility leases Maturities of facility leases were as follows as of September 30, 2021 (in thousands): As of September 30, 2021 Amount Remainder of 2021 $ 771 2022 3,135 2023 3,173 2024 2,877 2025 2,875 2026 and thereafter 6,308 Total lease payments 19,139 Less: imputed interest 2,628 Present value of lease liabilities $ 16,511 Vehicle Leases As of September 30, 2021, the Company was committed to minimum lease payments for vehicles leased under long-term non-cancelable finance leases as follows (in thousands): As of September 30, 2021 Amount Remainder of 2021 $ 130 2022 453 2023 199 2024 132 2025 9 Total lease payments 923 Less: imputed interest 93 Present value of lease liabilities $ 830 Weighted-average remaining lease term and discount rate, as of September 30, 2021, were as follows: Lease Term and Discount Rate September 30, 2021 Weighted-average remaining lease term (years) Operating leases 6.0 Finance leases 1.7 Weighted-average discount rate Operating leases 4.8 % Finance leases 6.5 % Lessor Information related to the Company ’ s system leasing During fiscal year ended December 31, 2020, the Company entered into leasing transactions, in which the Company is the lessor, offered through the Company's membership program. The Company's leases for equipment rentals were all accounted for as operating leases during the second and third quarters of 2020. During the fourth quarter ended December 31, 2020, certain of the membership program agreements were amended, granting the customers the exclusive right and option to purchase the leased system from the Company, at any time during the period of 12 months from signing the amended agreement. For contracts signed under the amended membership agreement, the Company classified and accounted for the arrangements as sales-type leases as of December 31, 2020, as the Company determined it is reasonably certain that the customer will exercise the purchase option. For the sales-type leases, the net investment of the Company’s lease receivable is measured at the commencement date and is included in the condensed consolidated balance sheets as a component of other current assets and prepaid expenses. As of December 31, 2020, the Company recorded $0.7 million of revenue for the sales-type leases in the condensed consolidated statement of operations and the related lease receivable in other current assets of the condensed consolidated balance sheet. There was no revenue recognized from the sales-type lease arrangement for the three and nine months ended September 30, 2021 and 2020, respectively. During the three and nine months ended September 30, 2021, the Company received a full payment of $0.1 million and $0.3 million from a customer who exercised a purchase option. As of September 30, 2021, the lease receivable balance included in other current assets of the condensed consolidated balance sheet was $0.4 million Equipment lease revenue for operating lease agreements is recognized over the life of the lease. The amount of operating lease income included in Product revenue in the accompanying condensed consolidated statements of operations for the nine months ended September 30, 2021 was $0.1 million. |
Leases | Leases The Company is a party to certain operating and finance leases for vehicles, office space and storage facilities. The Company’s operating leases consist of office space, as well as storage facilities and finance leases consist of automobiles. The Company’s leases generally have remaining terms of one The Company determines if a contract contains a lease at inception. Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent the right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of lease payments not yet paid, the Company estimates the incremental secured borrowing rates corresponding to the maturities of the leases. The Company based the rate estimates on prevailing financial market conditions, credit analysis, and management judgment. The Company recognizes expense for these leases on a straight-line basis over the lease term. Additionally, tenant incentives used to fund leasehold improvements are recognized when earned and reduce the Company’s right-of-use (“ROU”) asset related to the lease. These are amortized through the ROU asset as reductions of expense over the lease term. Supplemental balance sheet information related to leases was as follows (in thousands): Leases Classification September 30, December 31, Assets Right-of-use assets Operating lease assets $ 15,269 $ 17,076 Finance lease Property and equipment, net 377 467 Total leased assets $ 15,646 $ 17,543 Liabilities Classification September 30, December 31, Operating lease liabilities Operating lease liabilities, current Operating lease liabilities $ 2,394 $ 2,260 Operating lease liabilities, non-current Operating lease liabilities, net of current portion 14,117 15,950 Total Operating lease liabilities $ 16,511 $ 18,210 Finance lease liabilities Finance lease liabilities, current Accrued liabilities $ 497 $ 370 Finance lease liabilities, non-current Other long-term liabilities 333 242 Total Finance lease liabilities $ 830 $ 612 Lease costs during the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended Nine Months Ended Lease costs Classification 2021 2020 2021 2020 Finance lease cost Amortization expense $ 103 $ 121 $ 340 $ 545 Finance lease cost Interest for finance lease $ 12 $ 14 $ 40 $ 49 Operating lease cost Operating lease expense $ 882 $ 752 $ 2,641 $ 2,208 Cash paid for amounts included in the measurement of lease liabilities during the nine months ended September 30, 2021 and 2020 was as follows (in thousands): Nine Months Ended September 30, Cash paid for amounts included in the measurement of lease liabilities Classification 2021 2020 Operating cash flow Finance lease $ 38 $ 49 Financing cash flow Finance lease $ 314 $ 513 Operating cash flow Operating lease $ 2,324 $ 1,987 Facility leases Maturities of facility leases were as follows as of September 30, 2021 (in thousands): As of September 30, 2021 Amount Remainder of 2021 $ 771 2022 3,135 2023 3,173 2024 2,877 2025 2,875 2026 and thereafter 6,308 Total lease payments 19,139 Less: imputed interest 2,628 Present value of lease liabilities $ 16,511 Vehicle Leases As of September 30, 2021, the Company was committed to minimum lease payments for vehicles leased under long-term non-cancelable finance leases as follows (in thousands): As of September 30, 2021 Amount Remainder of 2021 $ 130 2022 453 2023 199 2024 132 2025 9 Total lease payments 923 Less: imputed interest 93 Present value of lease liabilities $ 830 Weighted-average remaining lease term and discount rate, as of September 30, 2021, were as follows: Lease Term and Discount Rate September 30, 2021 Weighted-average remaining lease term (years) Operating leases 6.0 Finance leases 1.7 Weighted-average discount rate Operating leases 4.8 % Finance leases 6.5 % Lessor Information related to the Company ’ s system leasing During fiscal year ended December 31, 2020, the Company entered into leasing transactions, in which the Company is the lessor, offered through the Company's membership program. The Company's leases for equipment rentals were all accounted for as operating leases during the second and third quarters of 2020. During the fourth quarter ended December 31, 2020, certain of the membership program agreements were amended, granting the customers the exclusive right and option to purchase the leased system from the Company, at any time during the period of 12 months from signing the amended agreement. For contracts signed under the amended membership agreement, the Company classified and accounted for the arrangements as sales-type leases as of December 31, 2020, as the Company determined it is reasonably certain that the customer will exercise the purchase option. For the sales-type leases, the net investment of the Company’s lease receivable is measured at the commencement date and is included in the condensed consolidated balance sheets as a component of other current assets and prepaid expenses. As of December 31, 2020, the Company recorded $0.7 million of revenue for the sales-type leases in the condensed consolidated statement of operations and the related lease receivable in other current assets of the condensed consolidated balance sheet. There was no revenue recognized from the sales-type lease arrangement for the three and nine months ended September 30, 2021 and 2020, respectively. During the three and nine months ended September 30, 2021, the Company received a full payment of $0.1 million and $0.3 million from a customer who exercised a purchase option. As of September 30, 2021, the lease receivable balance included in other current assets of the condensed consolidated balance sheet was $0.4 million Equipment lease revenue for operating lease agreements is recognized over the life of the lease. The amount of operating lease income included in Product revenue in the accompanying condensed consolidated statements of operations for the nine months ended September 30, 2021 was $0.1 million. |
Leases | Leases The Company is a party to certain operating and finance leases for vehicles, office space and storage facilities. The Company’s operating leases consist of office space, as well as storage facilities and finance leases consist of automobiles. The Company’s leases generally have remaining terms of one The Company determines if a contract contains a lease at inception. Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent the right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of lease payments not yet paid, the Company estimates the incremental secured borrowing rates corresponding to the maturities of the leases. The Company based the rate estimates on prevailing financial market conditions, credit analysis, and management judgment. The Company recognizes expense for these leases on a straight-line basis over the lease term. Additionally, tenant incentives used to fund leasehold improvements are recognized when earned and reduce the Company’s right-of-use (“ROU”) asset related to the lease. These are amortized through the ROU asset as reductions of expense over the lease term. Supplemental balance sheet information related to leases was as follows (in thousands): Leases Classification September 30, December 31, Assets Right-of-use assets Operating lease assets $ 15,269 $ 17,076 Finance lease Property and equipment, net 377 467 Total leased assets $ 15,646 $ 17,543 Liabilities Classification September 30, December 31, Operating lease liabilities Operating lease liabilities, current Operating lease liabilities $ 2,394 $ 2,260 Operating lease liabilities, non-current Operating lease liabilities, net of current portion 14,117 15,950 Total Operating lease liabilities $ 16,511 $ 18,210 Finance lease liabilities Finance lease liabilities, current Accrued liabilities $ 497 $ 370 Finance lease liabilities, non-current Other long-term liabilities 333 242 Total Finance lease liabilities $ 830 $ 612 Lease costs during the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended Nine Months Ended Lease costs Classification 2021 2020 2021 2020 Finance lease cost Amortization expense $ 103 $ 121 $ 340 $ 545 Finance lease cost Interest for finance lease $ 12 $ 14 $ 40 $ 49 Operating lease cost Operating lease expense $ 882 $ 752 $ 2,641 $ 2,208 Cash paid for amounts included in the measurement of lease liabilities during the nine months ended September 30, 2021 and 2020 was as follows (in thousands): Nine Months Ended September 30, Cash paid for amounts included in the measurement of lease liabilities Classification 2021 2020 Operating cash flow Finance lease $ 38 $ 49 Financing cash flow Finance lease $ 314 $ 513 Operating cash flow Operating lease $ 2,324 $ 1,987 Facility leases Maturities of facility leases were as follows as of September 30, 2021 (in thousands): As of September 30, 2021 Amount Remainder of 2021 $ 771 2022 3,135 2023 3,173 2024 2,877 2025 2,875 2026 and thereafter 6,308 Total lease payments 19,139 Less: imputed interest 2,628 Present value of lease liabilities $ 16,511 Vehicle Leases As of September 30, 2021, the Company was committed to minimum lease payments for vehicles leased under long-term non-cancelable finance leases as follows (in thousands): As of September 30, 2021 Amount Remainder of 2021 $ 130 2022 453 2023 199 2024 132 2025 9 Total lease payments 923 Less: imputed interest 93 Present value of lease liabilities $ 830 Weighted-average remaining lease term and discount rate, as of September 30, 2021, were as follows: Lease Term and Discount Rate September 30, 2021 Weighted-average remaining lease term (years) Operating leases 6.0 Finance leases 1.7 Weighted-average discount rate Operating leases 4.8 % Finance leases 6.5 % Lessor Information related to the Company ’ s system leasing During fiscal year ended December 31, 2020, the Company entered into leasing transactions, in which the Company is the lessor, offered through the Company's membership program. The Company's leases for equipment rentals were all accounted for as operating leases during the second and third quarters of 2020. During the fourth quarter ended December 31, 2020, certain of the membership program agreements were amended, granting the customers the exclusive right and option to purchase the leased system from the Company, at any time during the period of 12 months from signing the amended agreement. For contracts signed under the amended membership agreement, the Company classified and accounted for the arrangements as sales-type leases as of December 31, 2020, as the Company determined it is reasonably certain that the customer will exercise the purchase option. For the sales-type leases, the net investment of the Company’s lease receivable is measured at the commencement date and is included in the condensed consolidated balance sheets as a component of other current assets and prepaid expenses. As of December 31, 2020, the Company recorded $0.7 million of revenue for the sales-type leases in the condensed consolidated statement of operations and the related lease receivable in other current assets of the condensed consolidated balance sheet. There was no revenue recognized from the sales-type lease arrangement for the three and nine months ended September 30, 2021 and 2020, respectively. During the three and nine months ended September 30, 2021, the Company received a full payment of $0.1 million and $0.3 million from a customer who exercised a purchase option. As of September 30, 2021, the lease receivable balance included in other current assets of the condensed consolidated balance sheet was $0.4 million Equipment lease revenue for operating lease agreements is recognized over the life of the lease. The amount of operating lease income included in Product revenue in the accompanying condensed consolidated statements of operations for the nine months ended September 30, 2021 was $0.1 million. |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies The Company is named from time to time as a party to other legal proceedings, product liability, commercial disputes, employee disputes, and contractual lawsuits in the normal course of business. A liability and related charge are recorded to earnings in the Company’s consolidated financial statements for legal contingencies when the loss is considered probable and the amount can be reasonably estimated. The assessment is re-evaluated each accounting period and is based on all available information, including discussion with outside legal counsel. If a reasonable estimate of a known or probable loss cannot be made, but a range of probable losses can be estimated, the low-end of the range of losses is recognized if no amount within the range is a better estimate than any other. If a material loss is reasonably possible, but not probable and can be reasonably estimated, the estimated loss or range of loss is disclosed in the notes to the consolidated financial statements. The Company expenses legal fees as incurred. InMode Ltd. filed a complaint with the United States International Trade Commission alleging that Ilooda, Co., Ltd’s Secret RF fractional radiofrequency microneedling system, distributed in the United States by the Company, infringes U.S. Patent No. 10,799,285 ("285 patent"). The Company intends to vigorously defend against this lawsuit and, based on a preliminary investigation, believes that the Company has a strong defense and that the patent claim at issue is likely invalid in view of prior art. Based on the current information available to the Company, it believes that any possible loss will not be material. If, following a successful third-party action for infringement, the Company cannot obtain a license for the Company’s products, it may have to stop selling the applicable products. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Debt Convertible notes, net of unamortized debt issuance costs In March 2021, the Company issued $138.3 million aggregate principal amount of convertible senior notes due on March 15, 2026 in a private placement offering. The Convertible notes bear interest at a rate of 2.25% per year payable semiannually in arrears on March 15 and September 15 of each year, beginning on September 15, 2021. Upon conversion, the Convertible notes will be convertible into cash, shares of the Company’s common stock or a combination thereof, at the Company’s election. The Convertible notes are presented as Convertible notes, net of unamortized debt issuance costs, on the condensed consolidated balance sheet. Proceeds from the offering were $133.6 million, net of issuance costs, including initial purchasers fees. Initially, each $1,000 principal amount of Notes was convertible into 30.1427 shares of the Company’s common stock at a conversion price of $33.18 per share. The conversion rate for the Convertible notes is subject to adjustment for certain events as set forth in the Indenture governing the Convertible notes. The Convertible notes will mature on March 15, 2026, unless earlier converted, redeemed, or repurchased in accordance with the terms of the Convertible notes. No sinking fund is provided for the Notes. As of September 30, 2021, the net carrying amount of the Company’s Convertible notes was $134.0 million and the unamortized debt issuance costs were $4.2 million. Holders may convert their Notes at their option prior to the close of business on the business day immediately preceding December 15, 2025, in multiples of $1,000 principal amount, only under the following circumstances: • During any fiscal quarter commencing after the fiscal quarter ending on June 30, 2021 (and only during such fiscal quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on and including, the last trading day of the immediately preceding fiscal quarter, is greater than or equal to 130% of the conversion price for the Convertible notes on each applicable trading day; • During the five-business day period after any five consecutive trading day period (the “measurement period”) in which the “trading price” per $1,000 principal amount of Convertible notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company's common stock and the conversion rate on each such trading day; • The Company calls such Convertible notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date; or • Upon the occurrence of specified corporate events. On or after December 15, 2025, and until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their Notes, in multiples of $1,000 principal amount, at the option of the holder regardless of the foregoing circumstances. The circumstances described in the first bullet of the paragraph above were met during the second and third quarters of 2021 as the Company's stock traded at a price in excess of the conversion price for the required number of days during each quarter. As a result, the Notes were convertible at the option of the holder from July 1, 2021 until September 30, 2021, and are currently convertible at the option of the holder from October 1, 2021 until December 31, 2021. Upon any conversion requests of the Convertible notes, the Company would be required to pay or deliver, as the case may be, cash, shares of its common stock, or a combination of cash and shares of its common stock, at the Company’s election with respect to such conversion requests. To the extent there are any conversion requests during the period from October 1, 2021 until December 31, 2021, the Company intends to settle such conversion requests in shares of common stock. Therefore, as of September 30, 2021, the Convertible notes have been included as Long-term debt on the condensed consolidated balance sheet. The Company may not redeem the Convertible notes prior to March 20, 2024. On or after March 20, 2024, the Company may redeem for cash all or any portion of the Notes, at the Company’s option, 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 (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. If the Company elects to redeem fewer than all of the outstanding Notes, at least $50.0 million aggregate principal amount of Notes must be outstanding and not subject to redemption as of the relevant redemption notice date. If a fundamental change occurs, note holders have the option to require the Company to repurchase any portion or all of their Convertible notes in $1,000 principal increments for cash. The price for such repurchase is calculated as 100% of the principal amounts of Notes, plus accrued and unpaid interest to the day immediately preceding the Fundamental Change repurchase date. Additionally, holders of the Notes who convert in connection with a fundamental change are, under certain circumstances, entitled to an increase in conversion rate. The Convertible notes are general senior unsecured obligations that rank senior to any of the Company’s indebtedness that is explicitly subordinated to the Notes. The Notes have equal rank in right of payment with all existing and future unsecured indebtedness that is not subordinated to the Notes. The Notes will be junior to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness. The Notes do not contain any financial or operating covenants or any restrictions on the payment of dividends, the issuance of other indebtedness or the issuance or repurchase of securities by the Company. The estimated fair value of the Convertible notes was approximately $217.1 million as of September 30, 2021, which the Company determined through consideration of market prices. The fair value measurement is classified as Level 2, as defined in Note 3. The following table presents the outstanding principal amount and carrying value of the Convertible notes (in thousands): September 30, December 31, Outstanding principal amount $ 138,250 $ — Unamortized debt issuance costs (4,225) — Carrying Value $ 134,025 $ — In connection with issuance of the Convertible notes, the Company entered into capped call transactions with certain option counterparties. The capped call transactions are generally intended to reduce the potential dilution of the Company's common stock upon any conversion or settlement of the Notes or to offset any cash payment the Company is required to make in excess of the principal amount upon conversion of the Notes, as the case may be, with such reduction or offset subject to a cap based on the cap price. If the market price per share of the Company’s common stock exceeds the cap price of the capped calls transaction, then the Company’s stock would experience some dilution and/or the capped call would not fully offset the potential cash payments, in each case to the extent the then-market price per share of its common stock exceeds the cap price. Under the capped call transactions, the Company purchased from the option counterparties capped call options that in the aggregate relate to the total number of shares of the Company's common stock underlying the Convertible notes, with a strike price equal to the conversion price of the Convertible notes and with an initial cap price equal to $45.5350, which represents a 75% premium over the last reported sale price of the Company's common stock of $26.02 per share on March 4, 2021, with certain adjustments to the settlement terms that reflect standard anti-dilution provisions. The capped call transactions expire over 40 consecutive scheduled trading days ended on March 12, 2026. The capped calls were purchased for $16.1 million. The Company evaluated the capped call transaction under authoritative accounting guidance and determined that it should be accounted for as a separate transaction and classified as a net reduction to Additional paid-in capital within stockholders’ equity with no recurring fair value measurement recorded. The Company early adopted ASU 2020-6, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40). In accordance with Subtopic 470-20 and 815-40, as revised by ASU 2020-6, the Company records the Convertible notes in long-term debt with no separation between the Notes and the conversion option. Each reporting period, the Company will determine whether any criteria is met for the note holders to have the option to redeem the Notes early, which could result in a change in the classification of the Notes to current liabilities. Debt Issuance Cost The issuance costs related to the Convertible notes are presented in the condensed consolidated balance sheet as a direct deduction from the carrying amount of the Convertible notes. During the nine months ended September 30, 2021, the Company incurred direct costs associated with the issuance of Convertible notes of $4.7 million. The issuance costs are amortized using an effective interest method basis over the term of the Convertible notes and accordingly the Company recorded approximately $0.2 million and $0.5 million of amortization of debt issuance costs during the three and nine months ended September 30, 2021, respectively. The effective interest rate on the Convertible notes is 2.97%. Interest expense for the three and nine months ended September 30, 2021, including the amortization of debt issuance cost, totaled approximately $1.0 million and $2.2 million, respectively. Loan and Security Agreement On July 9, 2020, the Company entered into a Loan and Security Agreement with Silicon Valley Bank for a four-year secured revolving loan facility (“SVB Revolving Line of Credit”) in an aggregate principal amount of up to $30.0 million. The SVB Revolving Line of Credit matures on July 9, 2024. In order to draw on the full amount of the SVB Revolving Line of Credit, the Company must satisfy certain liquidity ratios. If the Company is unable to meet these liquidity ratios, then availability under the revolving line is calculated as 80% of the Company’s qualifying accounts receivable. The proceeds of the revolving loans may be used for general corporate purposes. The Company’s obligations under the Loan and Security Agreement with Silicon Valley Bank are secured by substantially all of the assets of the Company. Interest on principal amount outstanding under the revolving line shall accrue at a floating per annum rate equal to the greater of either 1.75% above the Prime Rate or five percent (5.0%). The Company paid a non-refundable revolving line commitment fee of $0.3 million, on the effective date of the Loan and Security Agreement with Silicon Valley Bank of July 9, 2020, and the Company is required to pay an anniversary fee of $0.3 million on each twelve-month anniversary of the effective date of the Loan and Security Agreement. The Loan and Security Agreement with Silicon Valley Bank contains customary affirmative covenants, such as financial statement reporting requirements and delivery of borrowing base certificates, as well as customary covenants that restrict the Company’s ability to, among other things, incur additional indebtedness, sell certain assets, guarantee obligations of third parties, declare dividends, or make certain distributions, and undergo a merger or consolidation or certain other transactions. The Loan and Security Agreement also contains certain financial covenants, including maintaining a quarterly minimum revenue of $90.0 million, determined in accordance with GAAP on a trailing twelve-month basis, but which is only applicable if the Company has an outstanding balance under the loan facility. On March 4, 2021, the Loan and Security Agreement dated July 9, 2020 was amended to (i) permit the Company to issue the Convertible notes and perform its obligations in connection therewith, and (ii) permit the Capped Call transactions. On or about May 28, 2021, the Loan and Security Agreement was amended. The amendment removed the quarterly minimum revenue requirement but kept in place the other financial covenants. As of September 30, 2021, the Company had not drawn on the SVB Revolving Line of Credit and the Company is in compliance with all financial covenants of the SVB Revolving Line of Credit. The Paycheck Protection Program (PPP) Loan On April 22, 2020, the Company received loan proceeds of $7.2 million pursuant to the Paycheck Protection Program (the “PPP”) under the CARES Act. The loan, which was in the form of a promissory note dated April 21, 2020, between the Company and Silicon Valley Bank as the lender, originally matured on April 21, 2022 and bore interest at a fixed rate of 1.00% per annum, payable monthly commencing September 2021. There was no prepayment penalty. Under the terms of the PPP, all or a portion of the principal may have been forgiven if the loan proceeds were used for qualifying expenses as described in the CARES Act, such as payroll costs, benefits, rent, and utilities. The PPP loan and related accrued interest were forgiven in June 2021 under the provisions of the CARES Act, and a $7.2 million gain on forgiveness was recorded as Gain on extinguishment of PPP loan in the condensed consolidated statement of operations. |
Segment reporting
Segment reporting | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment reportingSegment reporting is based on the “management approach,” following the method that management organizes the Company’s reportable segments for which separate financial information is made available to, and evaluated regularly by, the chief operating decision maker in allocating resources and in assessing performance. The Company’s chief operating decision makers ("CODM") are its Chief Executive Officer ("CEO") and Chief Financial Officer (“CFO”), who make decisions on allocating resources and in assessing performance. The CEO and CFO review the Company's consolidated results as one operating segment. In making operating decisions, the CODM primarily considers consolidated financial information, accompanied by disaggregated information about revenues by geography and product. All of the Company’s principal operations and decision-making functions are located in the U.S. The Company’s CODM view its operations, manages its business, and uses one measurement of profitability for the one operating segment - which sells aesthetic medical equipment and services, and distributes skincare products, to qualified medical practitioners. Substantially all of the Company’s long-lived assets are located in the U.S. The following table presents a summary of revenue by geography for the three and nine months September 30, 2021 and 2020 (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Revenue mix by geography: United States $ 22,737 $ 15,443 $ 64,553 $ 40,142 Japan 19,335 11,497 53,311 27,176 Asia, excluding Japan 3,790 3,204 9,869 8,279 Europe 3,651 2,769 12,703 6,910 Rest of the World, other than United States, Asia and Europe 7,871 6,219 25,205 15,233 Total consolidated revenue $ 57,384 $ 39,132 $ 165,641 $ 97,740 Revenue mix by product category: Products $ 32,191 $ 24,121 $ 96,079 $ 60,621 Consumables 3,684 2,304 11,040 6,263 Skincare 14,819 6,829 38,937 14,506 Total product revenue 50,694 33,254 146,056 81,390 Service 6,690 5,878 19,585 16,350 Total consolidated revenue $ 57,384 $ 39,132 $ 165,641 $ 97,740 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Operations and Principles of Consolidation | Description of Operations and Principles of Consolidation Cutera, Inc. (“Cutera” or the “Company”) provides energy-based aesthetic systems for practitioners worldwide. The Company develops, manufactures, distributes, and markets energy-based product platforms for use by physicians and other qualified practitioners, enabling them to offer safe and effective aesthetic treatments to their customers. The Company currently markets the following system platforms: enlighten, excel, Secret PRO, Secret RF, truSculpt and xeo . Several of the Company’s systems offer multiple hand pieces and applications, providing customers the flexibility to upgrade their systems. The sales of (i) systems, system upgrades, and hand pieces (collectively “Systems” revenue); (ii) replacement hand pieces, Titan, truSculpt 3 D,truSculpt iD and truSculpt flex cycle refills, as well as single use disposable tips applicable to Secret PRO and Secret RF (“Consumables” revenue); (iii) the distribution of third party manufactured skincare products (“Skincare” revenue); and (iv) the leasing of equipment through a membership program; are collectively classified as “Products” revenue. In addition to Product revenue, the Company generates revenue from the sale of post-warranty service contracts, parts, detachable hand piece replacements (except for Titan, truSculpt 3D, truSculpt iD and truSculpt flex) and service labor for the repair and maintenance of products that are out of warranty, all of which are collectively classified as “Service” revenue. |
Basis of Presentation | Basis of Presentation In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements included in this report reflect all adjustments necessary for a fair statement of its condensed consolidated statements of financial position as of September 30, 2021 and December 31, 2020, and its condensed consolidated statements of results of operations, comprehensive income (loss), changes in equity, and cash flows for the three and nine months ended September 30, 2021, and 2020. The December 31, 2020 condensed consolidated balance sheet was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). The results for interim periods are not necessarily indicative of results for the entire year or any other interim period. Presentation of certain prior year balances have been updated to conform with current year presentation. All significant intercompany accounts and transactions have been eliminated upon consolidation. The accompanying condensed consolidated financial statements should be read in conjunction with the Company’s previously filed audited financial statements and the related notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2020 filed with the Securities and Exchange Commission (the “SEC”) on March 23, 2021. |
Risks and Uncertainties | Risks and Uncertainties The Company's future results of operations involve a number of risks and uncertainties. Factors that could affect the Company's future operating results and cause actual results to vary materially from expectations include, but are not limited to, rapid technological change, continued acceptance of the Company's products, stability of global financial markets, cybersecurity breaches and other disruptions that could compromise the Company’s information or results, business disruptions that are caused by natural disasters or pandemic events, management of international activities, competition from substitute products and larger companies, ability to obtain and maintain regulatory approvals, government regulations and oversight, patent and other types of litigation, ability to protect proprietary technology from counterfeit versions of the Company's products, strategic relationships and dependence on key individuals. In March 2020, the World Health Organization declared the COVID-19 outbreak a pandemic. The COVID-19 outbreak has negatively affected the United States and global economies. Though the economy is gradually recovering as of the third quarter of 2021, the timing and extent of a full global economic recovery is still uncertain. The spread of the coronavirus and the Delta variant in particular, has impacted the global economy broadly in 2020 and 2021, including restrictions on travel, shifting work forces to work remotely and quarantine policies put into place by businesses and governments, had a material economic effect on the Company’s business during the year ended December 31, 2020 and in the nine months ended September 30, 2021. Healthcare facilities in many countries effectively banned elective procedures and this had a significant impact on the Company. Many of the Company’s products are used in aesthetic elective procedures and as such, the bans on elective procedures substantially reduced the Company’s sales and marketing efforts in the early months of the pandemic and led the Company to implement cost control measures. Although the Company’s revenues and profits have improved compared to the first three quarters of fiscal 2020 and the overall economic outlook has also improved in 2021, the COVID-19 outbreak continues to be fluid especially in light of the Delta variant, and the long-term impact on the Company's business due to COVID-19 is still uncertain. The Company cannot presently predict the scope and severity of any impacts in future periods from business shutdowns or disruptions due to the COVID-19 pandemic, but the impact on economic activity including the possibility of recession or financial market instability could have a material adverse effect on the Company’s business, revenue, operating results, cash flows and financial condition. The Company continues to assess whether any impairment of its goodwill or its long-lived assets has occurred and has determined that no charges were necessary during the nine months ended September 30, 2021, other than an impairment loss of $0.2 million on capitalized costs of cloud-based customer relationship management ("CRM") software. The Company will continue to monitor future conditions important to its assessment of potential impairment of its long-lived assets and goodwill, including the impacts of the COVID–19 pandemic and other ongoing impacts which are subject to uncertainty. The Company has experienced a significant increase in sales of skincare products under the exclusive distribution agreement with ZO Skin Health, Inc. (“ZO”), which allows the Company to sell ZO’s skincare products in Japan. The reason for the increase in skincare products sales may have been the result of the COVID-19 pandemic changing customers’ spending habits, resulting in customers purchasing aesthetic treatments that were able to be applied at home, due to limitations on in-person aesthetic procedures. Future growth in sales of skincare products depends on customers maintaining spending habits adopted during the COVID-19 pandemic. If customers revert to original spending habits after the COVID-19 pandemic, such changes may have a material adverse effect on the Company’s revenue, operating results, and cash flows. |
Accounting Policies | Accounting Policies These unaudited condensed consolidated financial statements are prepared in accordance with the rules and regulations of the SEC applicable to interim financial statements. While these statements reflect all normal recurring adjustments that are, in the opinion of management, necessary for fair presentation of the results of the interim period, they do not include all of the information and footnotes required by GAAP for complete financial statements. These condensed consolidated financial statements should be read in conjunction with the financial statement disclosures in its annual report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 23, 2021. The Company uses the same accounting policies in preparing quarterly and annual financial statements. Unless otherwise noted, amounts presented within the notes to condensed consolidated financial statements refer to the Company’s continuing operations. Note 13 provides information about the Company’s adoption of the new accounting standard for debt with conversion and other options, which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. The Company issued $138.3 million of convertible senior notes ("Notes" or "Convertible notes") in a private placement offering on March 5, 2021. The Convertible notes bear interest at a rate of 2.25% per year. In accordance with Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-6, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity ’ s Own Equity (Subtopic 815-40), the Company recorded the Convertible notes as long-term debt with no separation between the Convertible notes and the conversion option. Each reporting period, the Company will determine whether any criteria is met for the note holders to have the option to redeem the Convertible notes early, which may result in a change in the classification of the Convertible notes to current liabilities. The circumstances described in the paragraph above were met during the second and third quarters of 2021, as the Company's stock traded at a price in excess of the conversion price. As a result, the Notes were convertible at the option of the holder from July 1, 2021 until September 30, 2021, and are currently convertible from October 1, 2021 until December 31, 2021. Upon any conversion of the Convertible notes, the Company would be required to pay or deliver, as the case may be, cash, shares of its common stock, or a combination of cash and shares of its common stock, at the Company’s election. The Company did not receive any conversion requests in the three months ended September 30, 2021. To the extent there are any conversion requests during the period from October 1, 2021 until December 31, 2021, the Company intends to settle such conversion requests by issuing shares of common stock. Therefore, as of September 30, 2021, the Convertible notes have been included as long-term liability on the condensed consolidated balance sheet. The costs associated with issuance of the Convertible notes, including underwriters’ fees, are presented in the condensed consolidated balance sheet as a direct deduction from the carrying amount of the Convertible notes. The debt issuance costs are being amortized over the life of the Convertible notes as additional non-cash interest expense. In connection with issuance of the Convertible notes, the Company entered into capped call transactions with certain option counterparties. The capped call transactions are generally designated to reduce the potential dilution of the Company's common stock upon any conversion of the Notes. The capped calls were purchased for $16.1 million and recorded as a reduction to additional paid in capital in the condensed consolidated balance sheet as of September 30, 2021. The Company capitalized cloud computing systems implementation costs of $1.2 million and $1.8 million during the three and nine months ended September 30, 2021, respectively. These costs relate to an on-going implementation of a new Enterprise Resource Planning system and are included in Other long-term assets and Other current assets and prepaid expenses on the condensed consolidated balance sheet. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the amounts reported of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the accompanying notes, and the reported amounts of revenue and expenses during the reported periods. Actual results could differ materially from those estimates. On an ongoing basis, management evaluates its estimates, including those related to warranty obligations, sales commission, allowance for credit losses, sales allowances, valuation of inventories, fair value of goodwill, useful lives of property and equipment, impairment testing for long-lived-assets, implicit and incremental borrowing rates related to the Company’s leases, variables used in calculating the fair value of the Company's equity awards, expected achievement of performance based vesting criteria, management performance bonuses, assumptions used in operating and sales-type lease classification, the standalone selling price of the Company's products and services, the period of benefit used to capitalize and amortize contract acquisition costs, variable consideration, contingent liabilities, recoverability of deferred tax assets, residual value of leased equipment, lease term and effective income tax rates. Management bases estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12 Income Taxes (Topic 740)-Simplifying the Accounting for Income Taxes , to remove certain exceptions and improve consistency of application, including, among other things, requiring that an entity reflect the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. The Company adopted this guidance in the three and nine months ended September 30, 2021. The adoption of this guidance did not have a material impact on the Company’s consolidated financial position and results of operations. In August 2020, the FASB issued ASU No. 2020-6, Debt – Debt with Conversion and Other Options (Topic 470) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Topic 815), to simplify the accounting for convertible debt instruments by removing the beneficial conversion and cash conversion separation models for convertible instruments. Under the amendment, the embedded conversion features are no longer separated from the host contract for convertible instruments with conversion features that are not required to be accounted for as derivatives or that do not result in substantial premiums accounted for as paid-in capital. The update also amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of specific settlement provisions. In addition, the new guidance modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the computation of diluted earnings per share. The Company early adopted the guidance on a prospective basis effective January 1, 2021. See Note 13 – Debt. |
Cash, Cash Equivalents (Tables)
Cash, Cash Equivalents (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Cash and Cash Equivalents [Abstract] | |
Summary of Cash and Cash Equivalents | The following table summarizes the Company's cash and cash equivalents (in thousands): (Dollars in thousands) September 30, December 31, Cash and cash equivalents $ 162,486 $ 47,047 |
Balance Sheet Details (Tables)
Balance Sheet Details (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Inventories | As of September 30, 2021 and December 31, 2020, inventories consist of the following (in thousands): September 30, December 31, Raw materials $ 18,858 $ 14,874 Work in process 1,978 1,030 Finished goods 14,657 12,604 Total $ 35,493 $ 28,508 |
Schedule of Accrued Liabilities | As of September 30, 2021 and December 31, 2020, accrued liabilities consist of the following (in thousands): September 30, December 31, Bonus and payroll-related accruals $ 18,220 $ 12,197 Sales and marketing accruals 3,515 2,352 Accrued inventory in transit 4,623 2,476 Product warranty 3,926 4,124 Accrued sales tax 7,085 5,343 Other accrued liabilities 6,926 5,803 Total $ 44,295 $ 32,295 |
Product Warranty (Tables)
Product Warranty (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Product Warranties Disclosures [Abstract] | |
Product Warranty Liability Accrual | The following table provides the changes in the product warranty accrual for the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Beginning Balance $ 4,438 $ 4,815 $ 4,124 $ 6,400 Add: Accruals for warranties issued during the period 803 1,274 3,970 3,234 Less: Settlements made during the period (1,315) (1,668) (4,168) (5,213) Ending Balance $ 3,926 $ 4,421 $ 3,926 $ 4,421 |
Deferred Revenue (Tables)
Deferred Revenue (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Deferred Service Contract Revenue | The following table provides changes in the deferred revenue balance for the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Beginning balance $ 11,403 $ 11,779 $ 11,237 $ 14,222 Add: Payments received 3,880 3,854 13,226 9,314 Less: Revenue (2,576) (762) (4,851) (2,342) Less: Revenue recognized from beginning balance (2,027) (3,047) (8,932) (9,370) Ending balance $ 10,680 $ 11,824 $ 10,680 $ 11,824 |
Stockholders' Equity and Stoc_2
Stockholders' Equity and Stock-based Compensation Expense (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Activity under the 2019 Plan | Activity under the Company's equity incentive plans is summarized as follows: Shares Balance, December 31, 2020 1,085,170 Additional shares reserved 450,000 RSUs granted (213,522) PSUs granted (463,593) Options granted (172,139) Stock awards canceled / forfeited / expired 295,392 Options canceled / forfeited / expired 24,090 Balance, September 30, 2021 1,005,398 Options Outstanding Number of Weighted- Weighted Average Remaining Term Balance, December 31, 2020 217,007 $ 22.35 3.75 Options granted 172,139 $ 30.71 Options exercised (57,498) $ 24.49 Options canceled / forfeited / expired (24,090) $ 32.90 Balance, September 30, 2021 307,558 $ 25.80 4.84 Stock Awards Outstanding Number of Awards Outstanding Weighted Average Grant Date Fair Value per Share Balance, December 31, 2020 779,757 $ 23.96 RSUs granted 213,522 $ 36.80 PSUs granted 463,593 $ 41.23 Awards released (175,813) $ 22.45 Stock awards canceled / forfeited / expired (298,028) $ 27.24 Balance, September 30, 2021 983,031 $ 33.91 |
Summary of Stock-based Compensation Expense | Stock-based compensation expense by department recognized during the three and nine months ended September 30, 2021 and 2020 was as follows (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Cost of revenue $ 330 $ 326 $ 908 $ 1,359 Sales and marketing 711 648 1,954 2,618 Research and development 1,020 254 1,628 1,344 General and administrative 1,681 754 4,017 2,736 Total stock-based compensation expense $ 3,742 $ 1,982 $ 8,507 $ 8,057 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Income (Loss) | The following table sets forth the computation of basic and diluted net income (loss) and the weighted average number of shares used in computing basic and diluted net income (loss) per share (in thousands, except per share data): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Numerator: Net income (loss) used in calculating net income (loss) per share, basic and diluted $ (1,390) $ (2,257) $ 5,997 $ (26,065) Denominator: Weighted average shares of common stock outstanding used in computing net income (loss) per share, basic 17,945 17,603 17,860 16,368 Dilutive effect of incremental shares and share equivalents: Options — — 70 — RSUs — — 297 — PSUs — — 81 — ESPP — — 19 — Weighted average shares of common stock outstanding used in computing net income (loss) per share, diluted 17,945 17,603 18,327 16,368 Net income (loss) per share: Net income (loss) per share, basic $ (0.08) $ (0.13) $ 0.34 $ (1.59) Net income (loss) per share, diluted $ (0.08) $ (0.13) $ 0.33 $ (1.59) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following numbers of shares outstanding, prior to the application of the treasury stock method and the if-converted method, were excluded from the computation of diluted net income (loss) per common share for the periods presented because including them would have had an anti-dilutive effect (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Capped call 4,167 — 4,167 — Convertible notes 4,167 — 4,167 — Options to purchase common stock 308 232 187 246 Restricted stock units 528 733 72 735 Performance stock units 455 24 24 83 Employee stock purchase plan shares 22 17 — 57 Total 9,647 1,006 8,617 1,121 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases was as follows (in thousands): Leases Classification September 30, December 31, Assets Right-of-use assets Operating lease assets $ 15,269 $ 17,076 Finance lease Property and equipment, net 377 467 Total leased assets $ 15,646 $ 17,543 Liabilities Classification September 30, December 31, Operating lease liabilities Operating lease liabilities, current Operating lease liabilities $ 2,394 $ 2,260 Operating lease liabilities, non-current Operating lease liabilities, net of current portion 14,117 15,950 Total Operating lease liabilities $ 16,511 $ 18,210 Finance lease liabilities Finance lease liabilities, current Accrued liabilities $ 497 $ 370 Finance lease liabilities, non-current Other long-term liabilities 333 242 Total Finance lease liabilities $ 830 $ 612 Weighted-average remaining lease term and discount rate, as of September 30, 2021, were as follows: Lease Term and Discount Rate September 30, 2021 Weighted-average remaining lease term (years) Operating leases 6.0 Finance leases 1.7 Weighted-average discount rate Operating leases 4.8 % Finance leases 6.5 % |
Summary of Lease Costs | Lease costs during the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended Nine Months Ended Lease costs Classification 2021 2020 2021 2020 Finance lease cost Amortization expense $ 103 $ 121 $ 340 $ 545 Finance lease cost Interest for finance lease $ 12 $ 14 $ 40 $ 49 Operating lease cost Operating lease expense $ 882 $ 752 $ 2,641 $ 2,208 Cash paid for amounts included in the measurement of lease liabilities during the nine months ended September 30, 2021 and 2020 was as follows (in thousands): Nine Months Ended September 30, Cash paid for amounts included in the measurement of lease liabilities Classification 2021 2020 Operating cash flow Finance lease $ 38 $ 49 Financing cash flow Finance lease $ 314 $ 513 Operating cash flow Operating lease $ 2,324 $ 1,987 |
Summary of Maturities of Facility Leases | Maturities of facility leases were as follows as of September 30, 2021 (in thousands): As of September 30, 2021 Amount Remainder of 2021 $ 771 2022 3,135 2023 3,173 2024 2,877 2025 2,875 2026 and thereafter 6,308 Total lease payments 19,139 Less: imputed interest 2,628 Present value of lease liabilities $ 16,511 |
Summary of Minimum Finance Lease Payments | As of September 30, 2021, the Company was committed to minimum lease payments for vehicles leased under long-term non-cancelable finance leases as follows (in thousands): As of September 30, 2021 Amount Remainder of 2021 $ 130 2022 453 2023 199 2024 132 2025 9 Total lease payments 923 Less: imputed interest 93 Present value of lease liabilities $ 830 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Summary of Convertible Notes | The following table presents the outstanding principal amount and carrying value of the Convertible notes (in thousands): September 30, December 31, Outstanding principal amount $ 138,250 $ — Unamortized debt issuance costs (4,225) — Carrying Value $ 134,025 $ — |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Summary of Revenue by Geography | The following table presents a summary of revenue by geography for the three and nine months September 30, 2021 and 2020 (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Revenue mix by geography: United States $ 22,737 $ 15,443 $ 64,553 $ 40,142 Japan 19,335 11,497 53,311 27,176 Asia, excluding Japan 3,790 3,204 9,869 8,279 Europe 3,651 2,769 12,703 6,910 Rest of the World, other than United States, Asia and Europe 7,871 6,219 25,205 15,233 Total consolidated revenue $ 57,384 $ 39,132 $ 165,641 $ 97,740 Revenue mix by product category: Products $ 32,191 $ 24,121 $ 96,079 $ 60,621 Consumables 3,684 2,304 11,040 6,263 Skincare 14,819 6,829 38,937 14,506 Total product revenue 50,694 33,254 146,056 81,390 Service 6,690 5,878 19,585 16,350 Total consolidated revenue $ 57,384 $ 39,132 $ 165,641 $ 97,740 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Narrative (Details) $ in Thousands | Mar. 05, 2021USD ($) | Sep. 30, 2021USD ($)country | Sep. 30, 2021USD ($)country | Sep. 30, 2020USD ($) | Mar. 31, 2021 |
Product Information [Line Items] | |||||
Number of countries in which entity utilizes a distributor network | country | 42 | 42 | |||
Impairment loss | $ 200 | ||||
Proceeds from issuance of Convertible notes | 138,250 | $ 0 | |||
Capitalized cloud computing systems implementation costs | $ 1,200 | $ 1,800 | |||
Convertible Senior Notes Due 2026 | |||||
Product Information [Line Items] | |||||
Capped call transactions costs | $ 16,100 | ||||
Convertible Notes | Convertible Senior Notes Due 2026 | |||||
Product Information [Line Items] | |||||
Proceeds from issuance of Convertible notes | $ 138,300 | ||||
Interest rate | 2.25% | 2.25% |
Cash, Cash Equivalents - Summar
Cash, Cash Equivalents - Summary of Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Cash and Cash Equivalents [Abstract] | ||
Cash and cash equivalents | $ 162,486 | $ 47,047 |
Cash, Cash Equivalents - Narrat
Cash, Cash Equivalents - Narrative (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Cash and Cash Equivalents [Abstract] | ||
Marketable Securities | $ 0 | $ 0 |
Balance Sheet Details - Invento
Balance Sheet Details - Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Raw materials | $ 18,858 | $ 14,874 |
Work in process | 1,978 | 1,030 |
Finished goods | 14,657 | 12,604 |
Total | $ 35,493 | $ 28,508 |
Balance Sheet Details - Accrued
Balance Sheet Details - Accrued Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Bonus and payroll-related accruals | $ 18,220 | $ 12,197 |
Sales and marketing accruals | 3,515 | 2,352 |
Accrued inventory in transit | 4,623 | 2,476 |
Product warranty | 3,926 | 4,124 |
Accrued sales tax | 7,085 | 5,343 |
Other accrued liabilities | 6,926 | 5,803 |
Total | $ 44,295 | $ 32,295 |
Product Warranty - Summary of W
Product Warranty - Summary of Warranties (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||||
Beginning Balance | $ 4,438 | $ 4,815 | $ 4,124 | $ 6,400 |
Add: Accruals for warranties issued during the period | 803 | 1,274 | 3,970 | 3,234 |
Less: Settlements made during the period | (1,315) | (1,668) | (4,168) | (5,213) |
Ending Balance | $ 3,926 | $ 4,421 | $ 3,926 | $ 4,421 |
Deferred Revenue - Narrative (D
Deferred Revenue - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Deferred revenue balance, amount | $ 10.7 | $ 10.7 | ||
Costs for Extended Service Contracts | $ 2.1 | $ 6.3 | $ 1.9 | $ 5.6 |
Service | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Extended service contract, option one, term | 1 year | |||
Extended service contract, option two, term | 2 years | |||
Extended service contract, option three, term | 3 years | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Deferred revenue balance, percentage | 86.00% | 86.00% | ||
Expected timing of satisfaction, period | 12 months | 12 months |
Deferred Revenue - Summary of D
Deferred Revenue - Summary of Deferred Service Contract Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Change in Contract with Customer, Liability [Roll Forward] | ||||
Beginning balance | $ 11,403 | $ 11,779 | $ 11,237 | $ 14,222 |
Add: Payments received | 3,880 | 3,854 | 13,226 | 9,314 |
Less: Revenue | (2,576) | (762) | (4,851) | (2,342) |
Less: Revenue recognized from beginning balance | (2,027) | (3,047) | (8,932) | (9,370) |
Ending balance | $ 10,680 | $ 11,824 | $ 10,680 | $ 11,824 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||||||||
Typical payment receipt, period post shipment | 30 days | |||||||
Sales-type lease, revenue | $ 0 | $ 0 | $ 0 | $ 0 | $ 700,000 | |||
Training provided with sale of system, period | 180 days | |||||||
Contract with customer, liability | $ 10,680,000 | 11,824,000 | $ 10,680,000 | 11,824,000 | 11,237,000 | $ 11,403,000 | $ 11,779,000 | $ 14,222,000 |
Minimum | ||||||||
Disaggregation of Revenue [Line Items] | ||||||||
Capitalized costs, expected period of benefit | 2 years | 2 years | ||||||
Maximum | ||||||||
Disaggregation of Revenue [Line Items] | ||||||||
Capitalized costs, expected period of benefit | 3 years | 3 years | ||||||
Sales and marketing | ||||||||
Disaggregation of Revenue [Line Items] | ||||||||
Amortization expense | $ 400,000 | $ 600,000 | $ 1,400,000 | $ 2,000,000 | ||||
Other Assets | ||||||||
Disaggregation of Revenue [Line Items] | ||||||||
Capitalized contract costs | 3,800,000 | $ 3,800,000 | 3,400,000 | |||||
Service | ||||||||
Disaggregation of Revenue [Line Items] | ||||||||
Extended service contract, option one, term | 1 year | |||||||
Extended service contract, option two, term | 2 years | |||||||
Extended service contract, option three, term | 3 years | |||||||
Loyalty | ||||||||
Disaggregation of Revenue [Line Items] | ||||||||
Contract with customer, liability | $ 400,000 | $ 400,000 | $ 300,000 | |||||
Skincare | Japan | ||||||||
Disaggregation of Revenue [Line Items] | ||||||||
Sale of third-party product, warranty period | 90 days | |||||||
Transferred over Time | Service | ||||||||
Disaggregation of Revenue [Line Items] | ||||||||
Revenue from performance obligations transferred to customers, percent | 12.00% | 15.00% | 12.00% | 17.00% |
Stockholders' Equity and Stoc_3
Stockholders' Equity and Stock-based Compensation Expense - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Jul. 31, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options granted in period (in shares) | 172,139 | |||||
Total stock-based compensation expense | $ 3,742 | $ 1,982 | $ 8,507 | $ 8,057 | ||
Stock awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vested in period (in shares) | 175,813 | |||||
RSUs | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted (in shares) | 213,522 | |||||
PSUs | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted (in shares) | 463,593 | |||||
PSUs | Executive Officers, Senior Management, and Certain Employees | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted (in shares) | 463,593 | |||||
PSUs | Executive Officers, Senior Management, and Certain Employees | Continued service and operational goals for FY2021 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted (in shares) | 198,591 | |||||
PSUs | Executive Officers, Senior Management, and Certain Employees | Continued service and milestones from April 2023 through June 2024 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted (in shares) | 265,002 | |||||
2019 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Additional shares authorized (in shares) | 450,000 |
Stockholders' Equity and Stoc_4
Stockholders' Equity and Stock-based Compensation Expense - Activity Of Options Outstanding Under the 2019 Plans (Details) - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Shares Available for Grant | ||
Beginning balance (in shares) | 1,085,170 | |
Additional shares reserved (in shares) | 450,000 | |
Options granted (in shares) | (172,139) | |
Stock awards canceled (in shares) | 295,392 | |
Options canceled / forfeited / expired (in shares) | (24,090) | |
Ending balance (in shares) | 1,005,398 | 1,085,170 |
Number of Stock Options Outstanding | ||
Beginning balance (in shares) | 217,007 | |
Options granted (in shares) | 172,139 | |
Options exercised (in shares) | (57,498) | |
Options canceled / forfeited / expired (in shares) | (24,090) | |
Ending balance (in shares) | 307,558 | 217,007 |
Weighted- Average Exercise Price | ||
Beginning balance (in dollars per share) | $ 22.35 | |
Granted (in dollars per share) | 30.71 | |
Options exercised (in dollars per share) | 24.49 | |
Options canceled / forfeited / expired (in dollars per share) | 32.90 | |
Ending balance (in dollars per share) | $ 25.80 | $ 22.35 |
Weighted Average Remaining Term (in Years) | ||
Weighted average remaining term (in years) | 4 years 10 months 2 days | 3 years 9 months |
RSUs | ||
Shares Available for Grant | ||
Awards granted (in shares) | (213,522) | |
PSUs | ||
Shares Available for Grant | ||
Awards granted (in shares) | (463,593) |
Stockholders' Equity and Stoc_5
Stockholders' Equity and Stock-based Compensation Expense - Activity of Stock Awards Outstanding Under the 2019 Plans (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Number of Awards Outstanding | |
Stock awards canceled / forfeited / expired (in shares) | (295,392) |
Stock awards | |
Number of Awards Outstanding | |
Beginning balance (in shares) | 779,757 |
Awards released (in shares) | (175,813) |
Stock awards canceled / forfeited / expired (in shares) | (298,028) |
Ending balance (in shares) | 983,031 |
Weighted Average Grant Date Fair Value per Share | |
Beginning balance (in dollars per share) | $ / shares | $ 23.96 |
Awards released (in dollars per share) | $ / shares | 22.45 |
Stock awards canceled / forfeited / expired (in dollars per share) | $ / shares | 27.24 |
Ending balance (in dollars per share) | $ / shares | $ 33.91 |
PSUs | |
Number of Awards Outstanding | |
Milestone | 463,593 |
Weighted Average Grant Date Fair Value per Share | |
Stock awards granted (in dollars per share) | $ / shares | $ 41.23 |
RSUs | |
Number of Awards Outstanding | |
Milestone | 213,522 |
Weighted Average Grant Date Fair Value per Share | |
Stock awards granted (in dollars per share) | $ / shares | $ 36.80 |
Stockholders' Equity and Stoc_6
Stockholders' Equity and Stock-based Compensation Expense - Stock-based Compensation Expense By Department (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 3,742 | $ 1,982 | $ 8,507 | $ 8,057 |
Cost of revenue | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 330 | 326 | 908 | 1,359 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 711 | 648 | 1,954 | 2,618 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 1,020 | 254 | 1,628 | 1,344 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 1,681 | $ 754 | $ 4,017 | $ 2,736 |
Net Income (Loss) Per Share - N
Net Income (Loss) Per Share - Narrative (Details) | 9 Months Ended |
Sep. 30, 2021shares | |
Convertible Senior Notes Due 2026 | Convertible notes | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Debt convertible to common shares (in shares) | 4,167,232 |
Net Income (Loss) Per Share -_2
Net Income (Loss) Per Share - Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Numerator: | ||||
Net income (loss) used in calculating net income (loss) per share, basic | $ (1,390) | $ (2,257) | $ 5,997 | $ (26,065) |
Net income (loss) used in calculating net income (loss) per share, diluted | $ (1,390) | $ (2,257) | $ 5,997 | $ (26,065) |
Denominator: | ||||
Weighted average shares of common stock outstanding used in computing net income (loss) per share, basic (in shares) | 17,945 | 17,603 | 17,860 | 16,368 |
Dilutive effect of incremental shares and share equivalents: | ||||
Weighted average shares of common stock outstanding used in computing net income (loss) per share, diluted (in shares) | 17,945 | 17,603 | 18,327 | 16,368 |
Net income (loss) per share: | ||||
Net income (loss) per share, basic (USD per share) | $ (0.08) | $ (0.13) | $ 0.34 | $ (1.59) |
Net income (loss) per share, diluted (USD per share) | $ (0.08) | $ (0.13) | $ 0.33 | $ (1.59) |
Options | ||||
Dilutive effect of incremental shares and share equivalents: | ||||
Dilutive effect of share-based payment arrangements (in shares) | 0 | 0 | 70 | 0 |
RSUs | ||||
Dilutive effect of incremental shares and share equivalents: | ||||
Dilutive effect of share-based payment arrangements (in shares) | 0 | 0 | 297 | 0 |
PSUs | ||||
Dilutive effect of incremental shares and share equivalents: | ||||
Dilutive effect of share-based payment arrangements (in shares) | 0 | 0 | 81 | 0 |
ESPP | ||||
Dilutive effect of incremental shares and share equivalents: | ||||
Dilutive effect of share-based payment arrangements (in shares) | 0 | 0 | 19 | 0 |
Net Income (Loss) Per Share - A
Net Income (Loss) Per Share - Antidilutive Securities Excluded From Computation of Earnings Per Share (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 9,647 | 1,006 | 8,617 | 1,121 |
Capped call | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 4,167 | 0 | 4,167 | 0 |
Convertible notes | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 4,167 | 0 | 4,167 | 0 |
Options to purchase common stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 308 | 232 | 187 | 246 |
Restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 528 | 733 | 72 | 735 |
Performance stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 455 | 24 | 24 | 83 |
Employee stock purchase plan shares | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 22 | 17 | 0 | 57 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense | $ 462 | $ 664 | $ 842 | $ 1,207 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Lessee, Lease, Description [Line Items] | ||||||
Operating leases renewal terms (up to) | 5 years | 5 years | ||||
Finance leases renewal terms (up to) | 5 years | 5 years | ||||
Lessor, Lease, Description [Line Items] | ||||||
Customers' right to purchase leased system, term | 12 months | |||||
Sales-type lease, revenue | $ 0 | $ 0 | $ 0 | $ 0 | $ 700,000 | |
Proceeds from customer's exercise of purchase option | $ 100,000 | 300,000 | ||||
Revenue from equipment leases | $ 100,000 | |||||
Minimum | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Remaining lease terms of operating leases | 1 year | 1 year | ||||
Remaining lease terms of finance leases | 1 year | 1 year | ||||
Maximum | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Remaining lease terms of operating leases | 10 years | 10 years | ||||
Other Current Assets | ||||||
Lessor, Lease, Description [Line Items] | ||||||
Sales-type lease receivable | $ 400,000 | $ 700,000 | $ 400,000 | $ 700,000 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 |
Assets | |||
Right-of-use assets | $ 15,269 | $ 17,076 | |
Finance lease | 377 | 467 | |
Total leased assets | $ 15,646 | $ 17,543 | |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property and equipment, net | Property and equipment, net | |
Operating lease liabilities | |||
Operating lease liabilities, current | $ 2,394 | $ 2,260 | |
Operating lease liabilities, non-current | 14,117 | 15,950 | |
Present value of lease liabilities | 16,511 | 18,210 | |
Finance lease liabilities | |||
Finance lease liabilities, current | 497 | 370 | |
Finance lease liabilities, non-current | 333 | 242 | |
Total Finance lease liabilities | $ 830 | $ 612 | |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued liabilities | Accrued liabilities | |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other long-term liabilities | Other long-term liabilities |
Leases - Lease Costs (Details)
Leases - Lease Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Leases [Abstract] | ||||
Finance lease cost, Amortization expense | $ 103 | $ 121 | $ 340 | $ 545 |
Finance lease cost, Interest for finance lease | 12 | 14 | 40 | 49 |
Operating lease cost | $ 882 | $ 752 | $ 2,641 | $ 2,208 |
Leases - Cash Paid for Amounts
Leases - Cash Paid for Amounts Included in the Measurement of Lease Liabilities (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Leases [Abstract] | ||
Operating cash flow, Finance lease | $ 38 | $ 49 |
Financing cash flow, Finance lease | 314 | 513 |
Operating cash flow, Operating lease | $ 2,324 | $ 1,987 |
Leases - Maturities of Operatin
Leases - Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Remainder of 2021 | $ 771 | |
2022 | 3,135 | |
2023 | 3,173 | |
2024 | 2,877 | |
2025 | 2,875 | |
2026 and thereafter | 6,308 | |
Total lease payments | 19,139 | |
Less: imputed interest | 2,628 | |
Present value of lease liabilities | $ 16,511 | $ 18,210 |
Leases - Maturities of Finance
Leases - Maturities of Finance Leases Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Remainder of 2021 | $ 130 | |
2022 | 453 | |
2023 | 199 | |
2024 | 132 | |
2025 | 9 | |
Total lease payments | 923 | |
Less: imputed interest | 93 | |
Present value of lease liabilities | $ 830 | $ 612 |
Leases - Lease Information (Det
Leases - Lease Information (Details) | Sep. 30, 2021 |
Weighted-average remaining lease term (years) | |
Operating leases | 6 years |
Finance leases | 1 year 8 months 12 days |
Weighted-average discount rate | |
Operating leases | 4.80% |
Finance leases | 6.50% |
Contingencies - Narrative (Deta
Contingencies - Narrative (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Pending Litigation | ||
Loss Contingencies [Line Items] | ||
Accrued litigation liabilities | $ 0.8 | $ 0.4 |
Debt - Narrative (Details)
Debt - Narrative (Details) | Jul. 09, 2020USD ($) | Apr. 22, 2020USD ($) | Mar. 31, 2021USD ($)day$ / shares$ / item | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Mar. 05, 2021 | Mar. 04, 2021$ / shares |
Debt Instrument [Line Items] | |||||||||
Cap price (in USD per per share) | $ / item | 45.5350 | ||||||||
Premium over stock price (percent) | 75.00% | ||||||||
Stock price (in USD per share) | $ / shares | $ 26.02 | ||||||||
Capped-call transaction term, consecutive trading days | day | 40 | ||||||||
Purchase of capped call | $ 16,100,000 | $ 16,134,000 | $ 0 | ||||||
Interest on Convertible notes | $ 768,000 | $ 0 | 1,737,000 | 0 | |||||
Gain on extinguishment of PPP loan | 0 | $ 0 | 7,185,000 | $ 0 | |||||
Convertible Senior Notes Due 2026 | |||||||||
Debt Instrument [Line Items] | |||||||||
Convertible debt, conversion ratio | 0.0301 | ||||||||
Convertible Senior Notes Due 2026 | Common Stock | |||||||||
Debt Instrument [Line Items] | |||||||||
Conversion price (in dollars per share) | $ / shares | $ 33.18 | ||||||||
Loan and Security Agreement | Silicon Valley Bank | Revolving Credit Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate | 5.00% | ||||||||
Debt instrument term | 4 years | ||||||||
Maximum borrowing capacity | $ 30,000,000 | ||||||||
Qualifying accounts receivable | 80.00% | ||||||||
Commitment fee amount | $ 300,000 | ||||||||
Anniversary fee amount | 300,000 | ||||||||
Quarterly minimum revenue | $ 90,000,000 | ||||||||
Loan and Security Agreement | Silicon Valley Bank | Revolving Credit Facility | Prime Rate | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 1.75% | ||||||||
PPP Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate | 1.00% | ||||||||
Loan proceeds | $ 7,200,000 | ||||||||
Gain on extinguishment of PPP loan | 7,200,000 | 7,200,000 | |||||||
Convertible Notes | Convertible Senior Notes Due 2026 | |||||||||
Debt Instrument [Line Items] | |||||||||
Notes issued | $ 138,300,000 | ||||||||
Interest rate | 2.25% | 2.25% | |||||||
Proceeds from convertible notes, net of unamortized debt issuance costs | $ 133,600,000 | ||||||||
Carrying amount of convertible debt | 134,000,000 | 134,000,000 | |||||||
Unamortized debt issuance costs | 4,200,000 | 4,200,000 | |||||||
Redemption threshold percentage of stock price trigger | 130.00% | ||||||||
Redemption threshold trading days | day | 20 | ||||||||
Redemption threshold consecutive trading days | day | 30 | ||||||||
Redemption price, percentage | 100.00% | ||||||||
Required outstanding amount not subject to redemption | $ 50,000,000 | ||||||||
Debt issuance costs | 4,700,000 | 4,700,000 | |||||||
Amortization of Debt Issuance Costs | $ 200,000 | $ 500,000 | |||||||
Effective interest rate during period | 2.97% | 2.97% | |||||||
Interest on Convertible notes | $ 1,000,000 | $ 2,200,000 | |||||||
Convertible Notes | Convertible Senior Notes Due 2026 | Occurrence of Fundamental Change | |||||||||
Debt Instrument [Line Items] | |||||||||
Redemption price, percentage | 100.00% | ||||||||
Incremental repurchase amount | $ 1,000 | ||||||||
Convertible Notes | Convertible Senior Notes Due 2026 | Level 2 | |||||||||
Debt Instrument [Line Items] | |||||||||
Convertible debt at fair value | $ 217,100,000 | $ 217,100,000 | |||||||
Convertible Notes | Convertible Senior Notes Due 2026, First Conversion Trigger | |||||||||
Debt Instrument [Line Items] | |||||||||
Conversion threshold trading days | day | 20 | ||||||||
Threshold Consecutive trading days | day | 30 | ||||||||
Conversion threshold percentage of stock price trigger | 130.00% | ||||||||
Convertible Notes | Convertible Senior Notes Due 2026, Second Conversion Trigger | |||||||||
Debt Instrument [Line Items] | |||||||||
Conversion threshold trading days | day | 5 | ||||||||
Threshold Consecutive trading days | day | 5 | ||||||||
Conversion threshold percentage of stock price trigger | 98.00% |
Debt - Outstanding Debt and Car
Debt - Outstanding Debt and Carrying Value (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Unamortized debt issuance costs | $ (4,225) | |
Convertible Senior Notes Due 2026 | Convertible Notes | ||
Debt Instrument [Line Items] | ||
Outstanding principal amount | 138,250 | $ 0 |
Unamortized debt issuance costs | (4,225) | 0 |
Carrying Value | $ 134,025 | $ 0 |
Segment Reporting - Narrative (
Segment Reporting - Narrative (Details) | 9 Months Ended |
Sep. 30, 2021segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 1 |
Segment Reporting - Summary of
Segment Reporting - Summary of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | $ 57,384 | $ 39,132 | $ 165,641 | $ 97,740 |
Total product revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 50,694 | 33,254 | 146,056 | 81,390 |
Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 32,191 | 24,121 | 96,079 | 60,621 |
Consumables | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 3,684 | 2,304 | 11,040 | 6,263 |
Skincare | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 14,819 | 6,829 | 38,937 | 14,506 |
Service | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 6,690 | 5,878 | 19,585 | 16,350 |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 22,737 | 15,443 | 64,553 | 40,142 |
Japan | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 19,335 | 11,497 | 53,311 | 27,176 |
Asia, excluding Japan | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 3,790 | 3,204 | 9,869 | 8,279 |
Europe | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 3,651 | 2,769 | 12,703 | 6,910 |
Rest of the World, other than United States, Asia and Europe | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | $ 7,871 | $ 6,219 | $ 25,205 | $ 15,233 |