Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Oct. 31, 2013 | Nov. 15, 2013 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'VERINT SYSTEMS INC | ' |
Entity Central Index Key | '0001166388 | ' |
Current Fiscal Year End Date | '--01-31 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Oct-13 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Amendment Flag | 'false | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' |
Entity Voluntary Filers | 'No | ' |
Entity Common Stock, Shares Outstanding | ' | 53,455,327 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Oct. 31, 2013 | Jan. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current Assets: | ' | ' |
Cash and cash equivalents | $237,460 | $209,973 |
Restricted cash and bank time deposits | 8,172 | 11,128 |
Short-term investments | 138,851 | 13,593 |
Accounts receivable, net of allowance for doubtful accounts of $1.2 million and $1.8 million, respectively | 178,478 | 168,415 |
Inventories | 14,873 | 15,014 |
Deferred cost of revenue | 7,487 | 6,253 |
Prepaid expenses and other current assets | 58,564 | 77,277 |
Total current assets | 643,885 | 501,653 |
Property and equipment, net | 37,317 | 38,161 |
Goodwill | 838,722 | 829,909 |
Intangible assets, net | 126,086 | 144,261 |
Capitalized software development costs, net | 8,434 | 6,343 |
Long-term deferred cost of revenue | 8,916 | 7,742 |
Other assets | 63,164 | 36,200 |
Total assets | 1,726,524 | 1,564,269 |
Current Liabilities: | ' | ' |
Accounts payable | 57,425 | 47,355 |
Accrued expenses and other current liabilities | 166,015 | 177,736 |
Current maturities of long-term debt | 6,559 | 5,867 |
Deferred revenue | 156,188 | 163,252 |
Total current liabilities | 386,187 | 394,210 |
Long-term debt | 637,356 | 570,822 |
Long-term deferred revenue | 13,630 | 13,562 |
Other liabilities | 91,976 | 70,457 |
Total liabilities | 1,129,149 | 1,049,051 |
Preferred Stock - $0.001 par value; authorized 2,500,000 shares. Series A convertible preferred stock; Issued and outstanding 0 and 293,000 shares as of October 31, 2013 and January 31, 2013, respectively; aggregate liquidation preference and redemption value of $365,914 at January 31, 2013. | 0 | 285,542 |
Commitments and Contingencies | ' | ' |
Stockholders' Equity: | ' | ' |
Common stock - $0.001 par value; authorized 120,000,000 shares. Issued 53,756,000 and 40,460,000 shares; outstanding 53,454,000 and 40,158,000 shares as of October 31, 2013 and January 31, 2013, respectively. | 54 | 40 |
Additional paid-in capital | 911,971 | 580,762 |
Treasury stock, at cost - 302,000 shares as of October 31, 2013 and January 31, 2013. | -8,013 | -8,013 |
Accumulated deficit | -272,892 | -303,762 |
Accumulated other comprehensive loss | -42,251 | -44,225 |
Total Verint Systems Inc. stockholders' equity | 588,869 | 224,802 |
Noncontrolling interest | 8,506 | 4,874 |
Total stockholders' equity | 597,375 | 229,676 |
Total liabilities, preferred stock, and stockholders' equity | $1,726,524 | $1,564,269 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Oct. 31, 2013 | Jan. 31, 2013 |
Statement of Financial Position [Abstract] | ' | ' |
Allowance for Doubtful Accounts Receivable, Current | $1,200,000 | $1,800,000 |
Preferred Stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred Stock, authorized (in shares) | 2,500,000 | 2,500,000 |
Series A convertible preferred stock, issued (in shares) | 0 | 293,000 |
Series A convertible preferred stock, outstanding (in shares) | 0 | 293,000 |
Series A convertible preferred stock, aggregate liquidation preference value (in dollars) | 0 | 365,914,000 |
Series A convertible preferred stock, redemption value (in dollars) | $0 | $365,914,000 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, authorized (in shares) | 120,000,000 | 120,000,000 |
Common stock, issued (in shares) | 53,756,000 | 40,460,000 |
Common stock, outstanding (in shares) | 53,454,000 | 40,158,000 |
Treasury stock, (in shares) | 302,000 | 302,000 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 |
Revenue: | ' | ' | ' | ' |
Product | $101,974 | $87,404 | $287,189 | $281,393 |
Service and support | 122,340 | 114,116 | 364,358 | 329,188 |
Total revenue | 224,314 | 201,520 | 651,547 | 610,581 |
Cost of revenue: | ' | ' | ' | ' |
Product | 33,322 | 25,420 | 94,584 | 92,694 |
Service and support | 36,900 | 36,166 | 115,568 | 105,772 |
Amortization of acquired technology and backlog | 1,935 | 3,696 | 7,920 | 11,124 |
Total cost of revenue | 72,157 | 65,282 | 218,072 | 209,590 |
Gross profit | 152,157 | 136,238 | 433,475 | 400,991 |
Operating expenses: | ' | ' | ' | ' |
Research and development, net | 30,704 | 27,732 | 91,935 | 86,330 |
Selling, general and administrative | 77,472 | 85,626 | 240,540 | 232,302 |
Amortization of other acquired intangible assets | 6,150 | 6,109 | 18,193 | 18,342 |
Total operating expenses | 114,326 | 119,467 | 350,668 | 336,974 |
Operating income | 37,831 | 16,771 | 82,807 | 64,017 |
Other income (expense), net: | ' | ' | ' | ' |
Interest income | 242 | 125 | 563 | 379 |
Interest expense | -7,416 | -7,698 | -21,987 | -23,283 |
Loss on extinguishment of debt | 0 | 0 | -9,879 | 0 |
Other expense, net | -646 | -340 | -5,013 | -189 |
Total other expense, net | -7,820 | -7,913 | -36,316 | -23,093 |
Income before provision for income taxes | 30,011 | 8,858 | 46,491 | 40,924 |
Provision for income taxes | 5,957 | 2,243 | 11,869 | 9,414 |
Net income | 24,054 | 6,615 | 34,622 | 31,510 |
Net income attributable to noncontrolling interest | 1,567 | 1,144 | 3,752 | 3,397 |
Net income attributable to Verint Systems Inc. | 22,487 | 5,471 | 30,870 | 28,113 |
Dividends on preferred stock | 0 | -3,909 | -174 | -11,521 |
Net income attributable to Verint Systems Inc. common shares | $22,487 | $1,562 | $30,696 | $16,592 |
Net income per common share attributable to Verint Systems Inc.: | ' | ' | ' | ' |
Basic (in dollars per share) | $0.42 | $0.04 | $0.58 | $0.42 |
Diluted (in dollars per share) | $0.42 | $0.04 | $0.57 | $0.41 |
Weighted-average common shares outstanding | ' | ' | ' | ' |
Basic (in shares) | 53,374 | 39,785 | 52,781 | 39,622 |
Diluted (in shares) | 53,946 | 39,922 | 53,561 | 40,094 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 |
Net income | $24,054 | $6,615 | $34,622 | $31,510 |
Other comprehensive income, net of reclassification adjustments: | ' | ' | ' | ' |
Foreign currency translation adjustments | 12,232 | 7,258 | 1,537 | 2,877 |
Net unrealized gains on available-for-sale investments | 125 | 0 | 3 | 0 |
Net unrealized (losses) gains on derivative financial instruments designated as hedges | -870 | 2,632 | 283 | -708 |
Benefit from (provision for) income taxes on net unrealized (losses) gains on derivative financial instruments designated as hedges | 96 | -258 | 31 | 70 |
Other comprehensive income | 11,583 | 9,632 | 1,854 | 2,239 |
Comprehensive income | 35,637 | 16,247 | 36,476 | 33,749 |
Comprehensive income attributable to noncontrolling interest | 1,618 | 1,349 | 3,632 | 3,651 |
Comprehensive income attributable to Verint Systems Inc. | $34,019 | $14,898 | $32,844 | $30,098 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Stockholders' Equity (USD $) | Total | Total Verint Systems Inc. Stockholders' Equity | Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Deficit | Accumulated Other Comprehensive Loss | Noncontrolling Interest |
In Thousands, unless otherwise specified | ||||||||
Balances at Jan. 31, 2012 | $144,295 | $141,425 | $40 | $554,351 | ($7,466) | ($357,764) | ($47,736) | $2,870 |
Balances (in shares) at Jan. 31, 2012 | ' | ' | 38,982 | ' | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | 31,510 | 28,113 | ' | ' | ' | 28,113 | ' | 3,397 |
Other comprehensive income (loss) | 2,239 | 1,985 | ' | ' | ' | ' | 1,985 | 254 |
Stock-based compensation - equity portion | 15,022 | 15,022 | ' | 15,022 | ' | ' | ' | ' |
Exercises of stock options | 1,388 | 1,388 | ' | 1,388 | ' | ' | ' | ' |
Exercises of stock options (in shares) | ' | ' | 78 | ' | ' | ' | ' | ' |
Common stock issued for stock awards and stock bonuses | 3,764 | 3,764 | ' | 3,764 | ' | ' | ' | ' |
Common stock issued for stock awards and stock bonuses (in shares) | ' | ' | 1,056 | ' | ' | ' | ' | ' |
Purchases of treasury stock | -615 | -615 | ' | ' | -615 | ' | ' | ' |
Purchases of treasury stock (in shares) | ' | ' | -21 | ' | ' | ' | ' | ' |
Treasury stock retired | ' | ' | ' | 68 | -68 | ' | ' | ' |
Tax effects from stock award plans | 5 | 5 | ' | 5 | ' | ' | ' | ' |
Balances at Oct. 31, 2012 | 197,608 | 191,087 | 40 | 574,462 | -8,013 | -329,651 | -45,751 | 6,521 |
Balances (in shares) at Oct. 31, 2012 | ' | ' | 40,095 | ' | ' | ' | ' | ' |
Balances at Jan. 31, 2013 | 229,676 | 224,802 | 40 | 580,762 | -8,013 | -303,762 | -44,225 | 4,874 |
Balances (in shares) at Jan. 31, 2013 | ' | ' | 40,158 | ' | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | 34,622 | 30,870 | ' | ' | ' | 30,870 | ' | 3,752 |
Other comprehensive income (loss) | 1,854 | 1,974 | ' | ' | ' | ' | 1,974 | -120 |
Stock-based compensation - equity portion | 22,304 | 22,304 | ' | 22,304 | ' | ' | ' | ' |
Exercises of stock options | 6,432 | 6,432 | ' | 6,432 | ' | ' | ' | ' |
Exercises of stock options (in shares) | ' | ' | 246 | ' | ' | ' | ' | ' |
Common stock issued for stock awards and stock bonuses | 2,851 | 2,851 | 1 | 2,850 | ' | ' | ' | ' |
Common stock issued for stock awards and stock bonuses (in shares) | ' | ' | 776 | ' | ' | ' | ' | ' |
Stock issued for CTI Merger | 299,639 | 299,639 | 13 | 299,626 | ' | ' | ' | ' |
Stock Issued for CTI Merger (in shares) | ' | ' | 12,274 | ' | ' | ' | ' | ' |
Tax effects from stock award plans | -3 | -3 | ' | -3 | ' | ' | ' | ' |
Balances at Oct. 31, 2013 | $597,375 | $588,869 | $54 | $911,971 | ($8,013) | ($272,892) | ($42,251) | $8,506 |
Balances (in shares) at Oct. 31, 2013 | ' | ' | 53,454 | ' | ' | ' | ' | ' |
Condensed_Consolidated_Stateme3
Condensed Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 |
Cash flows from operating activities: | ' | ' |
Net income | $34,622 | $31,510 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 40,230 | 42,476 |
Stock-based compensation (equity portion) | 22,006 | 15,544 |
Non-cash losses on derivative financial instruments, net | 44 | 123 |
Losses on extinguishments of debt | 9,879 | 0 |
Other non-cash items, net | 1,783 | -5,955 |
Changes in operating assets and liabilities, net of effects of business combinations and CTI Merger: | ' | ' |
Accounts receivable | -8,820 | -2,481 |
Inventories | -861 | 1,761 |
Deferred cost of revenue | -1,951 | 13,185 |
Prepaid expenses and other assets | 24,822 | 6,261 |
Accounts payable and accrued expenses | 1,607 | -10,170 |
Deferred revenue | -7,918 | -29,968 |
Other, net | -424 | 2,848 |
Net cash provided by operating activities | 115,019 | 65,134 |
Cash flows from investing activities: | ' | ' |
Purchases of short-term investments | -195,509 | 0 |
Maturities of short-term investments | 70,000 | 0 |
Cash paid for business combinations, net of cash acquired | -10,457 | -660 |
Purchases of property and equipment | -9,439 | -11,472 |
Settlements of derivative financial instruments not designated as hedges | 205 | -266 |
Cash paid for capitalized software development costs | -3,892 | -2,921 |
Change in restricted cash and bank time deposits, including long-term portion | 5,935 | 1,271 |
Net cash used in investing activities | -143,157 | -14,048 |
Cash flows from financing activities: | ' | ' |
Proceeds from borrowings, net of original issuance discount | 646,750 | 0 |
Repayments of borrowings and other financing obligations | -584,309 | -5,130 |
Payments of debt issuance and other debt-related costs | -7,754 | -217 |
Cash received in CTI Merger | 10,370 | 0 |
Proceeds from exercises of stock options | 6,432 | 1,771 |
Purchases of treasury stock | 0 | -615 |
Payments of contingent consideration for business combinations (financing portion) | -16,087 | -6,074 |
Net cash provided by (used in) financing activities | 55,402 | -10,265 |
Effect of exchange rate changes on cash and cash equivalents | 223 | 545 |
Net increase in cash and cash equivalents | 27,487 | 41,366 |
Cash and cash equivalents, beginning of period | 209,973 | 150,662 |
Cash and cash equivalents, end of period | $237,460 | $192,028 |
BASIS_OF_PRESENTATION_AND_SIGN
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Oct. 31, 2013 | |
Accounting Policies [Abstract] | ' |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | ' |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
Description of Business | |
Unless the context otherwise requires, the terms "Verint", "we", "us", and "our" in these notes to condensed consolidated financial statements refer to Verint Systems Inc. and its consolidated subsidiaries. | |
Verint is a global leader in Actionable Intelligence solutions and value-added services. Our solutions enable organizations of all sizes to make more timely and effective decisions to improve enterprise performance and make the world a safer place. Our solutions are used to capture, distill, and analyze complex and underused information sources, such as voice, video, and unstructured text. In the enterprise intelligence market, our workforce optimization and voice of the customer solutions help organizations enhance the customer service experience, increase customer loyalty, enhance products and services, reduce operating costs, and drive revenue. In the security intelligence market, our communications and cyber intelligence, video and situation intelligence, and public safety solutions help government and commercial organizations in their efforts to protect people and property and neutralize terrorism and crime. | |
Preparation of Condensed Consolidated Financial Statements | |
The condensed consolidated financial statements included herein have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and on the same basis as the audited consolidated financial statements included in our Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”) for the year ended January 31, 2013. The condensed consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for the periods ended October 31, 2013 and 2012, and the condensed consolidated balance sheet as of October 31, 2013, are not audited but reflect all adjustments that are of a normal recurring nature and that are considered necessary for a fair presentation of the results for the periods shown. The condensed consolidated balance sheet as of January 31, 2013 is derived from the audited consolidated financial statements presented in our Annual Report on Form 10-K for the year ended January 31, 2013. Certain information and disclosures normally included in annual consolidated financial statements have been omitted pursuant to the rules and regulations of the SEC. Because the condensed consolidated interim financial statements do not include all of the information and disclosures required by GAAP for a complete set of financial statements, they should be read in conjunction with the audited consolidated financial statements and notes included in our Annual Report on Form 10-K filed with the SEC for the year ended January 31, 2013. The results for interim periods are not necessarily indicative of a full year’s results. | |
Significant Change in Ownership | |
On February 4, 2013, we successfully completed the acquisition of our former parent company, Comverse Technology, Inc. ("CTI"), eliminating CTI's majority ownership and control of us and establishing us as a fully independent public company. Prior to February 4, 2013, CTI beneficially owned a majority of our common stock (assuming the conversion of CTI’s holdings of our Series A Convertible Preferred Stock ("Preferred Stock") into common stock) and held a majority of the voting power of our common stock. Our acquisition of CTI is described in greater detail in Note 4, "Merger with CTI". | |
Principles of Consolidation | |
The accompanying condensed consolidated financial statements include the accounts of Verint Systems Inc., our wholly owned subsidiaries, and a joint venture in which we hold a 50% equity interest. This joint venture functions as a systems integrator for Asian markets and is a variable interest entity in which we are the primary beneficiary. Investments in companies in which we have less than a 20% ownership interest and do not exercise significant influence are accounted for at cost. We include the results of operations of acquired companies from the date of acquisition. All significant intercompany transactions and balances are eliminated. | |
Use of Estimates | |
The preparation of financial statements in conformity with GAAP requires our management to make estimates and assumptions, which may affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | |
Significant Accounting Policies | |
Our significant accounting policies are described in Note 1 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended January 31, 2013. There were no significant changes to our significant accounting policies during the nine months ended October 31, 2013. | |
New Accounting Pronouncements | |
New Accounting Pronouncements Implemented | |
In July 2012, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2012-02, Intangibles—Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment, which simplifies how entities test indefinite-lived intangible assets for impairment and improves consistency in impairment testing requirements among long-lived asset categories. These amended standards permit an assessment of qualitative factors to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying value. For assets in which this assessment concludes that it is more likely than not that the fair value is more than its carrying value, these amended standards eliminate the requirement to perform quantitative impairment testing. The amended guidance is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012, with early adoption permitted. Our adoption of this guidance effective February 1, 2013 did not materially impact our condensed consolidated financial statements. | |
In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income, which contained amended standards regarding disclosure requirements for items reclassified out of accumulated other comprehensive income ("AOCI"). These amended standards require the disclosure of information about the amounts reclassified out of AOCI by component and, in addition, require disclosure, either on the face of the financial statements or in the notes, of significant amounts reclassified out of AOCI by the respective line items of net income, but only if the amount reclassified is required to be reclassified in its entirety in the same reporting period. For amounts that are not required to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional details about those amounts. These amended standards do not change the current requirements for reporting net income or other comprehensive income in the condensed consolidated financial statements. These amended standards were effective for us on February 1, 2013, and adoption of this guidance did not materially impact our condensed consolidated financial statements. The disclosures required by the amended standards appear in Note 10, "Stockholders' Equity". | |
In July 2013, the FASB issued ASU No. 2013-10, Derivatives and Hedging (Topic 815): Inclusion of the Fed Funds Effective Swap Rate (or Overnight Index Swap Rate) as a Benchmark Interest Rate for Hedge Accounting Purposes, permitting entities to use the Fed Funds Effective Swap Rate as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815, in addition to the U.S. Treasury rate and the London Interbank Offered Rate (LIBOR). The amendments also remove the restriction on using different benchmark rates for similar hedges. The amendments in this ASU were effective prospectively for qualifying new or redesignated hedging relationships entered into on or after July 17, 2013. We adopted the amendments in this ASU effective July 17, 2013, and the initial adoption of the amendments in this ASU did not impact our condensed consolidated financial statements. | |
New Accounting Pronouncements To Be Implemented | |
In March 2013, the FASB issued ASU No. 2013-05, Foreign Currency Matters (Topic 830): Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity. This new standard is intended to resolve diversity in practice regarding the release into net income of a cumulative translation adjustment upon derecognition of a subsidiary or group of assets within a foreign entity. ASU No. 2013-05 is effective prospectively for fiscal years (and interim reporting periods within those years) beginning after December 15, 2013. We are currently reviewing this standard, but we do not anticipate that its adoption will have a material impact on our condensed consolidated financial statements, absent any material transactions involving the derecognition of subsidiaries or groups of assets within a foreign entity. | |
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. ASU No. 2013-11 requires that entities with an unrecognized tax benefit and a net operating loss carryforward or similar tax loss or tax credit carryforward in the same jurisdiction as the uncertain tax position present the unrecognized tax benefit as a reduction of the deferred tax asset for the loss or tax credit carryforward rather than as a liability, when the uncertain tax position would reduce the loss or tax credit carryforward under the tax law, thereby eliminating diversity in practice regarding this presentation issue. This new guidance is effective prospectively for annual reporting periods beginning on or after December 15, 2013, although retrospective application in permitted. We are currently assessing the impact of this guidance, if any, on our condensed consolidated financial statements. |
NET_INCOME_PER_COMMON_SHARE_AT
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC. | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC. | ' | ||||||||||||||||
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC. | |||||||||||||||||
The following table summarizes the calculation of basic and diluted net income per common share attributable to Verint Systems Inc. for the three and nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands, except per share amounts) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Net income | $ | 24,054 | $ | 6,615 | $ | 34,622 | $ | 31,510 | |||||||||
Net income attributable to noncontrolling interest | 1,567 | 1,144 | 3,752 | 3,397 | |||||||||||||
Net income attributable to Verint Systems Inc. | 22,487 | 5,471 | 30,870 | 28,113 | |||||||||||||
Dividends on Preferred Stock | — | (3,909 | ) | (174 | ) | (11,521 | ) | ||||||||||
Net income attributable to Verint Systems Inc. for basic net income per common share | 22,487 | 1,562 | 30,696 | 16,592 | |||||||||||||
Dilutive effect of dividends on Preferred Stock | — | — | — | — | |||||||||||||
Net income attributable to Verint Systems Inc. for diluted net income per common share | $ | 22,487 | $ | 1,562 | $ | 30,696 | $ | 16,592 | |||||||||
Weighted-average shares outstanding: | |||||||||||||||||
Basic | 53,374 | 39,785 | 52,781 | 39,622 | |||||||||||||
Dilutive effect of employee equity award plans | 572 | 137 | 780 | 472 | |||||||||||||
Dilutive effect of assumed conversion of Preferred Stock | — | — | — | — | |||||||||||||
Diluted | 53,946 | 39,922 | 53,561 | 40,094 | |||||||||||||
Net income per common share attributable to Verint Systems Inc.: | |||||||||||||||||
Basic | $ | 0.42 | $ | 0.04 | $ | 0.58 | $ | 0.42 | |||||||||
Diluted | $ | 0.42 | $ | 0.04 | $ | 0.57 | $ | 0.41 | |||||||||
We excluded the following weighted-average common shares underlying stock-based awards and the assumed conversion of our Preferred Stock from the calculations of diluted net income per common share because their inclusion would have been anti-dilutive: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Common shares excluded from calculation: | |||||||||||||||||
Stock options and restricted stock-based awards | 343 | 1,348 | 263 | 888 | |||||||||||||
Convertible Preferred Stock | — | 11,095 | 164 | 10,989 | |||||||||||||
Our Preferred Stock was canceled in conjunction with the CTI Merger on February 4, 2013. The weighted-average common shares underlying the assumed conversion of the Preferred Stock for the nine months ended October 31, 2013 in the table above reflect the Preferred Stock as outstanding for only four days during the nine months ended October 31, 2013. Further details regarding the CTI Merger appear in Note 4, "Merger with CTI". |
CASH_CASH_EQUIVALENTS_AND_SHOR
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Cash, Cash Equivalents, and Short-term Investments [Abstract] | ' | ||||||||||||||||
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS | ' | ||||||||||||||||
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS | |||||||||||||||||
The following tables summarize our cash, cash equivalents and short-term investments as of October 31, 2013 and January 31, 2013: | |||||||||||||||||
31-Oct-13 | |||||||||||||||||
(in thousands) | Cost Basis | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | |||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Cash and bank time deposits | $ | 191,922 | $ | — | $ | — | $ | 191,922 | |||||||||
Money market funds | 45,538 | — | — | 45,538 | |||||||||||||
Total cash and cash equivalents | $ | 237,460 | $ | — | $ | — | $ | 237,460 | |||||||||
Short-term investments: | |||||||||||||||||
Commercial paper and corporate debt securities (available-for-sale) | $ | 113,589 | $ | 3 | $ | — | $ | 113,592 | |||||||||
Bank time deposits | 25,259 | — | — | 25,259 | |||||||||||||
Total short-term investments | $ | 138,848 | $ | 3 | $ | — | $ | 138,851 | |||||||||
31-Jan-13 | |||||||||||||||||
(in thousands) | Cost Basis | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | |||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Cash and bank time deposits | $ | 143,888 | $ | — | $ | — | $ | 143,888 | |||||||||
Money market funds | 62,085 | — | — | 62,085 | |||||||||||||
Commercial paper | 4,000 | — | — | 4,000 | |||||||||||||
Total cash and cash equivalents | $ | 209,973 | $ | — | $ | — | $ | 209,973 | |||||||||
Short-term investments: | |||||||||||||||||
Bank time deposits | $ | 13,593 | $ | — | $ | — | $ | 13,593 | |||||||||
Total short-term investments | $ | 13,593 | $ | — | $ | — | $ | 13,593 | |||||||||
Bank time deposits which are reported within short-term investments consist of deposits held outside of the U.S. with maturities of greater than three months, or without specified maturity dates which we intend to hold for periods in excess of three months. | |||||||||||||||||
As of October 31, 2013, all of our available-for-sale investments had contractual maturities of less than one year. | |||||||||||||||||
We report our available-for-sale securities at fair value, based on quoted market prices or other readily available market information. Unrealized gains and losses, net of applicable income taxes, are included in accumulated other comprehensive income (loss) within stockholders’ equity on our condensed consolidated balance sheets. Realized gains or losses, if applicable, are recorded in other income (expense), net in our condensed consolidated statement of operations, using the specific identification method. We did not realize any gains or losses on sales of available-for-sale securities during the nine months ended October 31, 2013 and October 31, 2012. | |||||||||||||||||
We periodically review our investment portfolios to determine if any investment is other-than-temporarily impaired due to changes in credit risk or other potential valuation concerns. We believe that the investments we held at October 31, 2013 were not other-than-temporarily impaired. We held no available-for-sale securities with unrealized losses at October 31, 2013. We do not intend to sell our available-for-sale securities and it is not more likely than not that we will be required to sell them before recovery at par, which may be at maturity. | |||||||||||||||||
During the nine months ended October 31, 2013, proceeds from maturities of available-for-sale securities were $70.0 million. We received no proceeds from sales or maturities of available-for-sale securities during the nine months ended October 31, 2012. |
MERGER_WITH_CTI
MERGER WITH CTI | 9 Months Ended | |
Oct. 31, 2013 | ||
MERGER WITH CTI [Abstract] | ' | |
MERGER WITH CTI | ' | |
MERGER WITH CTI | ||
Overview | ||
On August 12, 2012, we entered into an agreement and plan of merger with CTI (the "CTI Merger Agreement"), providing for the merger of CTI with and into our new, wholly owned subsidiary (the "CTI Merger") upon the terms and subject to the conditions set forth in the CTI Merger Agreement. Pursuant to the terms of the CTI Merger Agreement, the completion of the CTI Merger was contingent upon, among other things, CTI's completion of a distribution to its shareholders of substantially all of its assets other than its interests in us (the "Comverse share distribution") or other sale or disposition by CTI of these assets. On October 31, 2012, CTI completed the Comverse share distribution in which it distributed all of the outstanding shares of common stock of its subsidiary, Comverse, Inc. ("Comverse"), to its shareholders. As a result of the Comverse share distribution, Comverse became an independent public company and ceased to be a wholly owned subsidiary of CTI. | ||
Following the satisfaction of the various conditions precedent to closing the CTI Merger, including the requisite approval of the CTI Merger Agreement and the transactions contemplated by that agreement by our stockholders and the shareholders of CTI, the CTI Merger was completed on February 4, 2013. As of January 31, 2013, prior to the effective time of the CTI Merger, CTI held approximately a 53.5% beneficial ownership position in us, assuming conversion of all of our Preferred Stock then held by CTI into shares of our common stock. The CTI Merger eliminated CTI's majority ownership and control of us. | ||
At the closing of the CTI Merger, each issued and outstanding share of CTI common stock was converted into the right to receive new shares of our common stock at an exchange ratio of 0.1298 shares of our common stock for each share of CTI common stock, pursuant to which approximately 28.6 million of newly issued shares of our common stock were exchanged for approximately 220.0 million issued and outstanding shares of CTI common stock. In addition, the 16.3 million shares of our common stock and all shares of our Preferred Stock held by CTI at the time of the CTI Merger were canceled, resulting in approximately 12.3 million incremental shares of our common stock outstanding upon completion of the CTI Merger. | ||
The 28.6 million shares of our common stock issued to CTI shareholders in the CTI Merger were comprised of the following: | ||
• | 16.3 million shares in exchange for the same number of shares held by CTI at the time of the CTI Merger. | |
• | 11.2 million shares in exchange for all shares of our Preferred Stock held by CTI at the time of the CTI Merger, calculated using the $366.1 million liquidation preference of the Preferred Stock at the CTI Merger date and a conversion price of $32.66 per share. | |
• | 0.8 million shares determined by dividing a $25.0 million "Target Amount" by $32.78, which was the average of the daily volume weighted averages of the trading prices of our common stock during the 20 consecutive trading days ending on January 31, 2013. The $25.0 million "Target Amount" was determined in accordance with the CTI Merger Agreement based on CTI's successful completion of the Comverse share distribution on October 31, 2012. | |
• | 0.3 million shares determined by dividing CTI's $9.9 million positive net worth (as defined in the CTI Merger Agreement) at the effective date of the CTI Merger, by $32.78, which was the average of the daily volume weighted averages of the trading prices of our common stock during the 20 consecutive trading days ending on January 31, 2013. The maximum allowable CTI positive net worth for which consideration was to be paid in the CTI Merger was $10.0 million. | |
Holders of shares of our common stock immediately prior to the completion of the CTI Merger, other than CTI, continued to own their existing shares, which were not affected by the CTI Merger. | ||
The CTI Merger qualified as a tax-free reorganization for U.S. federal income tax purposes. | ||
Several agreements between Verint and CTI were executed concurrently with the CTI Merger Agreement, including a Voting Agreement and a Governance and Repurchase Rights Agreement, which terminated upon completion of the CTI Merger on February 4, 2013. These agreements governed certain activities of the parties prior to the CTI Merger, and also provided for certain rights and obligations in the event that the CTI Merger Agreement was terminated. | ||
During the three and nine months ended October 31, 2013, we incurred expenses associated with this matter of $0.1 million and $0.6 million, respectively, consisting primarily of legal and other professional fees, which have been expensed as incurred and are reflected within selling, general and administrative expenses. During the year ended January 31, 2013, we incurred $16.1 million of expenses associated with this matter, $9.6 million and $12.9 million of which were incurred during the three and nine months ended October 31, 2012, respectively. | ||
As noted previously, on October 31, 2012, CTI completed the spin-off of Comverse as an independent, publicly traded company, accomplished by means of a pro rata distribution of 100% of Comverse's outstanding common shares to CTI's shareholders. Following the Comverse share distribution, Comverse and CTI operated independently, and neither had any ownership interest in the other. In order to govern certain ongoing relationships between CTI and Comverse after the Comverse share distribution and to provide mechanisms for an orderly transition, CTI and Comverse entered into a Distribution Agreement, Transition Services Agreement, Tax Disaffiliation Agreement and Employee Matters Agreement in connection with the Comverse share distribution. | ||
The Distribution Agreement, among other things, provides for the allocation between CTI and Comverse of various assets, liabilities and obligations attributable to periods prior to the Comverse share distribution. Under the Distribution Agreement, Comverse agreed to indemnify CTI and its affiliates (including Verint following the CTI Merger) against certain losses, including losses arising as a result of the CTI Merger and the Comverse share distribution. Certain of Comverse's indemnification obligations are capped at $25.0 million and certain obligations are uncapped. Pursuant to the terms of the Distribution Agreement, at the closing of the CTI Merger, CTI placed $25.0 million of cash into an escrow account to support indemnification claims to the extent made against Comverse by CTI and its affiliates (including Verint after the CTI Merger). The balance remaining in such escrow account on August 4, 2014 (18 months after the closing of the CTI Merger), if any, will be released to Comverse. Claims related to an Israeli option holder lawsuit, details of which appear in Note 16, "Commitments and Contingencies", are excluded from the escrow account and would be indemnifiable directly by Comverse without cap. | ||
Under the Transition Services Agreement, each of Comverse and CTI (including Verint after the CTI Merger) provide the other with certain administrative services on an interim basis for agreed upon fees. The Tax Disaffiliation Agreement governs rights, responsibilities and obligations of CTI and Comverse after the Comverse share distribution with respect to tax liabilities and benefits, tax attributes, tax contests and other tax matters. The Employee Matters Agreement allocates liabilities and responsibilities relating to CTI and Comverse employee compensation and benefit plans. | ||
Condensed Consolidated Financial Statement Impact | ||
For financial reporting purposes, the CTI Merger was accounted for as our acquisition of CTI in a combination of entities under common control. We are the continuing financial reporting entity. Common control transactions are transfers and exchanges between entities that are under the control of the same parent, or are transactions in which all of the combining entities are controlled by the same party or parties before and after the transaction and that control is not transitory. When accounting for a transfer of assets or exchange of shares between entities under common control, the entity receiving the net assets or the equity interests recognizes the assets and liabilities transferred at their carrying amounts in the accounts of the transferring entity at the date of the transfer. | ||
Following the October 31, 2012 Comverse share distribution, the net assets of CTI consisted primarily of its controlling equity interests in Verint, as well as certain residual cash and cash equivalents and other sundry net assets. In addition, CTI had net operating loss ("NOL") carryforwards for income tax reporting purposes and other tax attributes. No CTI employees, operations or business processes moved to the combined company in the CTI Merger. As a result, our net assets and operations prior to the CTI Merger represent the vast majority of the net assets and all of the operations of the combined company. | ||
As a result of the CTI Merger, our consolidated stockholders' equity was adjusted to reflect the $285.5 million carrying value of our Preferred Stock, all of which was held by CTI, and the $14.1 million carrying value of CTI's net assets (other than its equity interests in us) at February 4, 2013, as increases to our additional paid-in capital. Prior to the CTI Merger, our Preferred Stock had been classified as mezzanine equity on our condensed consolidated balance sheet. The majority of CTI's net assets (other than its equity interests in us) at February 4, 2013 consisted of cash and cash equivalents. | ||
As noted above, CTI's net assets also included net deferred tax assets primarily relating to CTI's NOL carryforwards for income tax purposes. The net deferred tax assets were fully offset by unrecognized tax benefits and valuation allowances. Also included in CTI's net assets were $15.8 million of liabilities primarily related to certain unrecognized tax benefits (not offsetting NOL carryforwards) and accrued penalties and interest and corresponding indemnification assets totaling the same amount, recognizing Comverse's contractual obligation under the Tax Disaffiliation Agreement to indemnify us for these liabilities. All of these amounts are preliminary and are based on the information that was available to us through the date of this report. We are continuing to gather and assess information in this regard, and changes to the amounts previously recorded resulting from facts and circumstances that existed as of the merger date regarding these matters, if any, will be recorded as an adjustment to CTI's net assets. |
BUSINESS_COMBINATIONS_BUSINESS
BUSINESS COMBINATIONS BUSINESS COMBINATIONS | 9 Months Ended | ||||
Oct. 31, 2013 | |||||
Business Combinations [Abstract] | ' | ||||
Business Combination Disclosure | ' | ||||
BUSINESS COMBINATIONS | |||||
Nine Months Ended October 31, 2013 | |||||
CTI Merger | |||||
On February 4, 2013, we completed the CTI Merger which is discussed in Note 4, "Merger with CTI". | |||||
Other Business Combinations | |||||
During the three months ended October 31, 2013, we completed two business combinations: | |||||
• | On August 1, 2013, we acquired certain technology and other assets for use in our Communications Intelligence operating segment in a transaction that qualified as a business combination. | ||||
• | On October 4, 2013, we acquired all of the outstanding shares of a privately held company specializing in performance improvements in customer contact centers, based in the Europe, the Middle East and Africa ("EMEA") region, that is being integrated into our Enterprise Intelligence operating segment. | ||||
These business combinations were not individually material to our condensed consolidated financial statements. | |||||
We have included the financial results of these business combinations in our condensed consolidated financial statements from their respective acquisition dates. | |||||
The combined consideration for these business combinations was approximately $15.4 million, including $10.9 million of combined cash paid at the closings. We also agreed to make potential additional cash payments to the respective former shareholders or asset owners aggregating up to approximately $5.4 million, contingent upon the achievement of certain performance targets over periods ending through July 2014. The combined fair values of these contingent consideration obligations were estimated to be $4.6 million as of the respective acquisition dates, and have not significantly changed as of October 31, 2013. | |||||
The fair values assigned to identifiable intangible assets acquired in these business combinations were determined primarily by using the income approach, which discounts expected future cash flows attributable to these assets to present value using estimates and assumptions determined by management. The acquired identifiable finite-lived intangible assets are being amortized on a straight-line basis, which we believe approximates the pattern in which the assets are utilized, over their estimated useful lives. | |||||
Included among the factors contributing to the recognition of goodwill in these transactions were synergies in products and technologies, and the addition of a skilled, assembled workforce. Of the $7.8 million of goodwill associated with these business combinations, $7.1 million was assigned to our Enterprise Intelligence segment and is not deductible for income tax purposes and $0.7 million was assigned to our Communications Intelligence segment, which is deductible for income tax purposes. | |||||
Revenue and the impact on net income attributable to these acquisitions for the three months ended October 31, 2013 were not significant. | |||||
Transaction and related costs, consisting primarily of professional fees and integration expenses, directly related to these acquisitions, totaled $0.6 million and $1.1 million for the three and nine months ended October 31, 2013, respectively. All transaction and related costs were expensed as incurred within selling, general and administrative expenses. | |||||
The following table sets forth the components and the allocations of the purchase prices for the two business combinations completed during the three months ended October 31, 2013. These purchase price allocations have been prepared on a preliminary basis and changes to those allocations may occur as additional information becomes available during the respective measurement periods (up to one year from the respective acquisition dates). | |||||
(in thousands) | Amount | ||||
Components of Combined Purchase Price: | |||||
Cash | $ | 10,853 | |||
Fair value of contingent consideration | 4,557 | ||||
Total Combined Purchase Price | $ | 15,410 | |||
Allocation of Combined Purchase Price: | |||||
Net tangible liabilities: | |||||
Accounts receivable | $ | 1,545 | |||
Other current assets, including cash acquired | 1,468 | ||||
Other assets | 245 | ||||
Current and other liabilities | (1,118 | ) | |||
Deferred revenue | (760 | ) | |||
Deferred income taxes, net - current and long-term | (2,164 | ) | |||
Net tangible liabilities | (784 | ) | |||
Identifiable intangible assets: | |||||
Customer relationships | 6,809 | ||||
Developed technology | 1,209 | ||||
Trademarks and trade names | 409 | ||||
Total identifiable intangible assets | 8,427 | ||||
Goodwill | 7,767 | ||||
Total Combined Purchase Price | $ | 15,410 | |||
For these acquisitions, customer relationships, developed technology, and trademarks and trade names were assigned estimated useful lives of nine years, from three years to five years, and two years, respectively, the weighted average of which is approximately 8.1 years. | |||||
The pro forma impact of these acquisitions was not material to our historical condensed consolidated operating results and is therefore not presented. | |||||
In October 2013, we signed a definitive agreement to acquire all of the outstanding shares of a privately held provider of fraud prevention and identity authentication solutions, based in the Americas region, which would be integrated into our Enterprise Intelligence operating segment. This business combination, if completed, will not be material to our condensed consolidated financial statements. We expect to close this acquisition prior to January 31, 2014. | |||||
Please refer to Note 18, "Subsequent Event", for information regarding a business combination completed subsequent to October 31, 2013. | |||||
Business Combinations in Prior Periods | |||||
Transactions associated with business combinations completed in prior periods that impacted our condensed consolidated financial statements as of October 31, 2013, and for the nine months ended October 31, 2013 and 2012, are described below. | |||||
Vovici Corporation | |||||
On August 4, 2011, we acquired all of the outstanding shares of Vovici Corporation (“Vovici”), a U.S.-based provider of online survey management and enterprise feedback solutions, for total consideration of $66.1 million. Included in this consideration was $9.9 million for the fair value of potential additional cash payments to the former Vovici shareholders of up to approximately $19.1 million, payment of which was contingent upon the achievement of certain performance targets over the period from the acquisition date through January 31, 2013. | |||||
At each reporting date, we revalue all contingent consideration obligations associated with business combinations to their estimated fair values, and any increases or decreases in fair values are reflected within selling, general and administrative expenses in our condensed consolidated statement of operations. Changes in the fair value of the contingent consideration obligation may result from changes in discount periods and rates, and changes in probability assumptions with respect to the likelihood of achieving the performance targets. | |||||
As of January 31, 2013, $6.4 million had been accrued for the actual contingent consideration earned and expected to be paid to the former Vovici shareholders under this arrangement. This liability changed by a negligible amount during the three months ended April 30, 2013, and payment of this amount was made during the three months ending July 31, 2013. No contingent consideration had been paid to the former Vovici shareholders prior to this payment. We have no further contingent consideration obligations for this acquisition. | |||||
For the three and nine months ended October 31, 2012, we recorded an expense of $0.8 million and a benefit of $2.9 million, respectively, within selling, general and administrative expenses for changes in the fair value of the Vovici contingent consideration obligation, which primarily reflected the impacts of revised expectations of achieving the performance targets. | |||||
Transaction and related costs, consisting primarily of professional fees and integration expenses, directly related to the acquisition of Vovici totaled $0.3 million and $0.5 million for the three and nine months ended October 31, 2012, respectively, and were expensed as incurred within selling, general and administrative expenses. Such costs for the nine months ended October 31, 2013 were not significant. | |||||
Global Management Technologies | |||||
On October 7, 2011, we acquired all of the outstanding shares of Global Management Technologies (“GMT”), a U.S.-based provider of workforce management solutions whose software and services are widely used by organizations, particularly in retail branch banking environments, for total consideration of $36.6 million. Included in this consideration was $12.0 million for the fair value of potential additional cash payments to the former GMT shareholders of up to approximately $17.4 million, payment of which is contingent upon the achievement of certain performance targets over the period from the acquisition date through January 31, 2014. | |||||
As of January 31, 2013, the fair value of this contingent consideration was $2.8 million. During the three months ended July 31, 2013, we reached an agreement to settle our potential obligations under the GMT contingent consideration arrangement with respect to the former GMT securityholders in exchange for a payment of $2.7 million. This payment, which was made during the three months ending July 31, 2013, eliminated any remaining contingent consideration obligations to these former securityholders. No contingent consideration had been paid under the GMT contingent consideration arrangement prior to this payment. Certain other participants under the GMT contingent consideration arrangement, who were not GMT securityholders, remain eligible to earn contingent consideration for the period ended January 31, 2014, the fair value of which was negligible at October 31, 2013. For the three and nine months ended October 31, 2013, we recorded benefits of $0.8 million and $0.1 million, respectively, within selling, general and administrative expenses for the change in the fair value of the GMT contingent consideration obligation. | |||||
For the three and nine months ended October 31, 2012, we recorded benefits of $1.3 million and $5.8 million, respectively, within selling, general and administrative expenses for changes in the fair value of the GMT contingent consideration obligation, which primarily reflected the impacts of revised expectations of achieving the performance targets. | |||||
Transaction and related costs, consisting primarily of professional fees and integration expenses, directly related to the acquisition of GMT, totaled $0.1 million and $0.3 million for the three and nine months ended October 31, 2012, and were expensed as incurred within selling, general and administrative expenses. Such costs for the nine months ended October 31, 2013 were not significant. | |||||
Other Business Combinations | |||||
During the year ended January 31, 2012, in addition to the acquisitions of Vovici and GMT, we executed five additional business combinations for total combined consideration of $55.2 million, including $20.5 million for the fair value of potential additional cash payments to the respective former shareholders or asset owners aggregating up to approximately $41.0 million, payment of which is contingent upon the achievement of certain performance targets over periods extending through January 31, 2015. | |||||
For the three and nine months ended October 31, 2013, we recorded net benefits of $1.0 million and $1.6 million, respectively, within selling, general and administrative expenses for changes in the aggregate fair values of the contingent consideration obligations associated with these acquisitions, reflecting the impacts of revised expectations of achieving the performance targets, as well as decreases in the discount periods since the acquisition dates. As of October 31, 2013, the aggregate fair value of the contingent consideration obligations associated with these acquisitions was $6.4 million. During the nine months ended October 31, 2013 and 2012, we made payments of $7.8 million and $5.2 million, respectively, to the respective former shareholders or asset owners under these arrangements. | |||||
Transaction and related costs, consisting primarily of professional fees and integration expenses, directly related to these acquisitions, totaled $0.1 million and $0.6 million for the three and nine months ended October 31, 2012, respectively, and were expensed as incurred within selling, general and administrative expenses. Such costs for the nine months ended October 31, 2013 were not significant. | |||||
In connection with one of the foregoing business combinations, the purchase price allocation included liabilities for uncertain tax positions and certain other liabilities associated with pre-acquisition business activities of the acquired company. Based upon our evaluation of these matters, including assessments of additional information obtained subsequent to the acquisition date regarding facts and circumstances that existed as of the acquisition date, the purchase price allocation for this acquisition included current liabilities of approximately $4.7 million associated with certain other pre-acquisition business activities of the acquired company and long-term liabilities of approximately $5.2 million associated with uncertain tax positions of the acquired company. Corresponding indemnification assets of $4.7 million and $5.2 million, respectively, classified in the same manner, were also recorded as components of the purchase price allocation for this acquisition, in recognition of the selling shareholders’ contractual obligation to indemnify us for these pre-acquisition liabilities and were measured on the same basis as the corresponding liabilities. | |||||
As of January 31, 2013, the liability associated with pre-acquisition uncertain tax positions of the acquired company was $3.0 million and was included within other liabilities, and the corresponding indemnification asset of $2.6 million was included within other assets. Also as of January 31, 2013, the liability associated with certain other pre-acquisition business activities of the acquired company was $3.0 million, and was included within accrued expenses and other current liabilities, and the corresponding indemnification asset, reflected within prepaid expenses and other current assets, was $3.0 million. | |||||
As of October 31, 2013, the liability associated with certain other pre-acquisition business activities of the acquired company, included within accrued expenses and other current liabilities, and the corresponding indemnification asset, reflected within prepaid expenses and other current assets, were $2.2 million. The changes in these carrying values during the nine months ended October 31, 2013 reflected derecognition of certain liabilities and corresponding indemnification assets and the impact of foreign currency exchange rate fluctuations. These changes were offsetting and therefore did not impact our condensed consolidated statement of operations for the three and nine months ended October 31, 2013. | |||||
As of October 31, 2013, the liability associated with pre-acquisition uncertain tax positions of the acquired company was $2.2 million and was included within other liabilities. The change in the carrying value of this liability during the nine months ended October 31, 2013 reflected the settlement of an uncertain tax position and the impact of foreign currency exchange rate fluctuations. In addition, during the three months ended April 30, 2013 and October 31, 2013, based upon our assessment of the collectibility of the indemnification from the former shareholders of the acquired company, we recognized impairments of $0.3 million and $0.4 million, respectively, of the indemnification asset associated with these liabilities, which is included in other income (expense), net. No impairment was recognized for the three months ended July 31, 2013. The indemnification asset associated with these liabilities was $1.2 million as of October 31, 2013 and is included within other assets. |
INTANGIBLE_ASSETS_AND_GOODWILL
INTANGIBLE ASSETS AND GOODWILL | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||
INTANGIBLE ASSETS AND GOODWILL | ' | ||||||||||||||||
INTANGIBLE ASSETS AND GOODWILL | |||||||||||||||||
Acquisition-related intangible assets consisted of the following as of October 31, 2013 and January 31, 2013: | |||||||||||||||||
October 31, 2013 | |||||||||||||||||
(in thousands) | Cost | Accumulated | Net | ||||||||||||||
Amortization | |||||||||||||||||
Intangible assets with finite lives: | |||||||||||||||||
Customer relationships | $ | 232,256 | $ | (135,140 | ) | $ | 97,116 | ||||||||||
Acquired technology | 95,733 | (72,612 | ) | 23,121 | |||||||||||||
Trade names | 13,113 | (11,085 | ) | 2,028 | |||||||||||||
Non-competition agreements | 5,516 | (4,785 | ) | 731 | |||||||||||||
Distribution network | 2,440 | (1,779 | ) | 661 | |||||||||||||
Backlog | 843 | (114 | ) | 729 | |||||||||||||
Total intangible assets with finite lives | 349,901 | (225,515 | ) | 124,386 | |||||||||||||
In-process research and development, with indefinite lives | 1,700 | — | 1,700 | ||||||||||||||
Total | $ | 351,601 | $ | (225,515 | ) | $ | 126,086 | ||||||||||
January 31, 2013 | |||||||||||||||||
(in thousands) | Cost | Accumulated | Net | ||||||||||||||
Amortization | |||||||||||||||||
Intangible assets with finite lives: | |||||||||||||||||
Customer relationships | $ | 225,321 | $ | (117,903 | ) | $ | 107,418 | ||||||||||
Acquired technology | 93,860 | (64,617 | ) | 29,243 | |||||||||||||
Trade names | 12,737 | (10,537 | ) | 2,200 | |||||||||||||
Non-competition agreements | 5,516 | (4,227 | ) | 1,289 | |||||||||||||
Distribution network | 2,440 | (1,596 | ) | 844 | |||||||||||||
Backlog | 843 | (76 | ) | 767 | |||||||||||||
Total intangible assets with finite lives | 340,717 | (198,956 | ) | 141,761 | |||||||||||||
In-process research and development, with indefinite lives | 2,500 | — | 2,500 | ||||||||||||||
Total | $ | 343,217 | $ | (198,956 | ) | $ | 144,261 | ||||||||||
The following table presents net acquisition-related intangible assets by reportable segment as of October 31, 2013 and January 31, 2013: | |||||||||||||||||
October 31, | January 31, | ||||||||||||||||
(in thousands) | 2013 | 2013 | |||||||||||||||
Enterprise Intelligence | $ | 111,291 | $ | 126,341 | |||||||||||||
Video Intelligence | 3,002 | 3,880 | |||||||||||||||
Communications Intelligence | 11,793 | 14,040 | |||||||||||||||
Total | $ | 126,086 | $ | 144,261 | |||||||||||||
Total amortization expense recorded for acquisition-related intangible assets was $8.1 million and $26.1 million for the three and nine months ended October 31, 2013, respectively, and $9.8 million and $29.5 million for the three and nine months ended October 31, 2012, respectively. | |||||||||||||||||
The reported amount of net acquisition-related intangible assets can fluctuate from the impact of changes in foreign exchange rates on intangible assets not denominated in U.S. dollars. | |||||||||||||||||
Estimated future amortization expense on finite-lived acquisition-related intangible assets as of October 31, 2013 is as follows: | |||||||||||||||||
(in thousands) | |||||||||||||||||
Years Ending January 31, | Amount | ||||||||||||||||
2014 (remainder of year) | $ | 8,544 | |||||||||||||||
2015 | 32,491 | ||||||||||||||||
2016 | 30,806 | ||||||||||||||||
2017 | 27,873 | ||||||||||||||||
2018 | 11,575 | ||||||||||||||||
2019 and thereafter | 13,097 | ||||||||||||||||
Total | $ | 124,386 | |||||||||||||||
No impairment indicators were identified for finite-lived intangible assets during the nine months ended October 31, 2013 and 2012. Our in-process research and development assets were acquired during the year ended January 31, 2012, and no impairment indicators were identified for these assets during the nine months ended October 31, 2013 and 2012. | |||||||||||||||||
Goodwill represents the excess of the purchase price in a business combination over the fair value of net tangible and identifiable intangible assets acquired. At the acquisition date, goodwill resulting from a business combination is assigned to those reporting units expected to benefit from the synergies of the combination. Reporting units may either be at, or one level below, our operating segment level. | |||||||||||||||||
Goodwill activity and related information for the nine months ended October 31, 2013, in total and by reportable segment, was as follows: | |||||||||||||||||
Reportable Segment | |||||||||||||||||
(in thousands) | Total | Enterprise | Video | Communications | |||||||||||||
Intelligence | Intelligence | Intelligence | |||||||||||||||
Goodwill, gross, at January 31, 2013 | $ | 896,774 | $ | 771,738 | $ | 76,803 | $ | 48,233 | |||||||||
Accumulated impairment losses through January 31, 2013 | (66,865 | ) | (30,791 | ) | (36,074 | ) | — | ||||||||||
Goodwill, net, at January 31, 2013 | 829,909 | 740,947 | 40,729 | 48,233 | |||||||||||||
Business combinations | 7,767 | 7,055 | — | 712 | |||||||||||||
Foreign currency translation and other | 1,046 | 1,637 | 6 | (597 | ) | ||||||||||||
Goodwill, net, at October 31, 2013 | $ | 838,722 | $ | 749,639 | $ | 40,735 | $ | 48,348 | |||||||||
Goodwill, net, at October 31, 2013: | |||||||||||||||||
Goodwill, gross, at October 31, 2013 | $ | 905,587 | $ | 780,430 | $ | 76,809 | $ | 48,348 | |||||||||
Accumulated impairment losses through October 31, 2013 | (66,865 | ) | (30,791 | ) | (36,074 | ) | — | ||||||||||
Goodwill, net, at October 31, 2013 | $ | 838,722 | $ | 749,639 | $ | 40,735 | $ | 48,348 | |||||||||
No events or circumstances indicating the potential for goodwill impairment were identified during the nine months ended October 31, 2013 and 2012. |
LONGTERM_DEBT
LONG-TERM DEBT | 9 Months Ended | ||||||||
Oct. 31, 2013 | |||||||||
Long-term Debt, Unclassified [Abstract] | ' | ||||||||
LONG-TERM DEBT | ' | ||||||||
LONG-TERM DEBT | |||||||||
The following table summarizes our long-term debt at October 31, 2013 and January 31, 2013: | |||||||||
October 31, | January 31, | ||||||||
(in thousands) | 2013 | 2013 | |||||||
Term loan facility - 2013 Amended Credit Agreement: | |||||||||
Outstanding borrowings | $ | 646,750 | $ | — | |||||
Unamortized debt discount | (2,944 | ) | — | ||||||
Term loan facility - 2011 Credit Agreement: | |||||||||
Outstanding borrowings | — | 576,000 | |||||||
Unamortized debt discount | — | (2,199 | ) | ||||||
Other debt | 109 | 2,888 | |||||||
Total debt | 643,915 | 576,689 | |||||||
Less: current maturities | 6,559 | 5,867 | |||||||
Long-term debt | $ | 637,356 | $ | 570,822 | |||||
In May 2007, we entered into a $675.0 million secured credit agreement (the "2007 Credit Agreement") comprised of a $650.0 million seven-year term loan facility and a $25.0 million six-year revolving line of credit. The borrowing capacity under the revolving line of credit was increased to $75.0 million in July 2010. | |||||||||
In April 2011, we entered into a new credit agreement (the "2011 Credit Agreement") and concurrently terminated the 2007 Credit Agreement. The 2011 Credit Agreement provided for $770.0 million of secured credit facilities, comprised of a $600.0 million term loan maturing in October 2017 and a $170.0 million revolving credit facility maturing in April 2016, subject to increase (up to a maximum increase of $300.0 million) and reduction from time to time according to the terms of the 2011 Credit Agreement. | |||||||||
The 2011 Credit Agreement included an original issuance term loan discount of 0.50%, or $3.0 million, resulting in net term loan proceeds of $597.0 million. This discount was being amortized as interest expense over the term of the term loan using the effective interest method. | |||||||||
The majority of the term loan proceeds under the 2011 Credit Agreement were used to repay all $583.2 million of outstanding term loan borrowings under the 2007 Credit Agreement at the closing date of the 2011 Credit Agreement. There were no outstanding borrowings under the revolving credit facility under the 2007 Credit Agreement at the closing date of the 2011 Credit Agreement. | |||||||||
On March 6, 2013, we entered into an amendment and restatement agreement with the lenders under the 2011 Credit Agreement providing for the amendment and restatement of the 2011 Credit Agreement (as amended and restated, the "2013 Amended Credit Agreement"). The 2013 Amended Credit Agreement provides for $850.0 million of senior secured credit facilities, comprised of (i) a $650.0 million term loan maturing in September 2019 and (ii) a $200.0 million revolving credit facility maturing in March 2018, subject to increase (up to a maximum increase of $300.0 million) and reduction from time to time according to the terms of the 2013 Amended Credit Agreement. | |||||||||
The 2013 Amended Credit Agreement included an original issuance term loan discount of 0.50%, or $3.3 million, resulting in net term loan proceeds of $646.7 million. This discount is being amortized as interest expense over the term of the 2013 term loan using the effective interest method. | |||||||||
The majority of the proceeds of the term loan under the 2013 Amended Credit Agreement were used to repay all $576.0 million of outstanding term loan borrowings under the 2011 Credit Agreement at the March 6, 2013 closing date of the 2013 Amended Credit Agreement. There were no outstanding borrowings under the 2011 Credit Agreement's revolving credit facility at the closing date of the 2013 Amended Credit Agreement. | |||||||||
The terms and conditions of the 2011 Credit Agreement have been superseded by the terms and conditions of the 2013 Amended Credit Agreement, although some terms and conditions have remained consistent. | |||||||||
Loans under the 2013 Amended Credit Agreement bear interest, payable quarterly or, in the case of Eurodollar loans with an interest period of three months or shorter, at the end of any interest period, at a per annum rate of, at our election: | |||||||||
(a) in the case of Eurodollar loans, the Adjusted LIBO Rate plus 3.00% (or, if our corporate credit ratings are BB- and Ba3 or better, 2.75%). The Adjusted LIBO Rate is the greater of (i) 1.00% per annum and (ii) the product of the LIBO Rate and Statutory Reserves (both as defined in the 2013 Amended Credit Agreement), and | |||||||||
(b) in the case of Base Rate loans, the Base Rate plus 2.00% (or, if our corporate credit ratings are BB- and Ba3 or better, 1.75%). The Base Rate is the greatest of (i) the administrative agent's prime rate, (ii) the Federal Funds Effective Rate (as defined in the 2013 Amended Credit Agreement) plus 0.50% and (iii) the Adjusted LIBO Rate for a one-month interest period plus 1.00%. | |||||||||
As of October 31, 2013, the interest rate on the term loan under the 2013 Amended Credit Agreement was 4.00%. Including the impact of the 0.50% original issuance term loan discount and the deferred debt issuance costs, the effective interest rate on the term loan was approximately 4.23% as of October 31, 2013. As of January 31, 2013, the interest rate on the term loan under the 2011 Credit Agreement was 4.50%. | |||||||||
Loans under the 2011 Credit Agreement incurred interest in a similar manner as loans under the 2013 Amended Credit Agreement, as follows: | |||||||||
(a)in the case of Eurodollar loans, the Adjusted LIBO Rate plus 3.25% (or, if our corporate credit ratings were at least BB- and Ba3 or better, 3.00%). The Adjusted LIBO Rate was the greater of (i) 1.25% per annum and (ii) the product of the LIBO Rate and Statutory Reserves (both as defined in the 2011 Credit Agreement), and | |||||||||
(b)in the case of Base Rate loans, the Base Rate plus 2.25% (or, if our corporate credit ratings were at least BB- and Ba3 or better, 2.00%). The Base Rate was the greatest of (i) the administrative agent’s prime rate, (ii) the Federal Funds Effective Rate (as defined in the 2011 Credit Agreement) plus 0.50% and (iii) the Adjusted LIBO Rate for a one-month interest period plus 1.00%. | |||||||||
We incurred debt issuance costs of approximately $7.5 million, associated with the 2013 Amended Credit Agreement, which have been deferred and are classified within Other assets and are being amortized as interest expense over the term of the 2013 Amended Credit Agreement. Of these deferred costs, $5.0 million were associated with the term loan and are being amortized using the effective interest rate method. Deferred costs associated with the revolving credit facility were $2.5 million and are being amortized on a straight-line basis. | |||||||||
At the March 6, 2013 closing date of the 2013 Amended Credit Agreement, there were $11.0 million of unamortized deferred fees and $2.2 million of unamortized original issuance term loan discount associated with the 2011 Credit Agreement. Of the $11.0 million of unamortized deferred fees, $3.5 million were associated with the revolving credit commitments under the 2011 Credit Agreement provided by lenders that are continuing to provide revolving credit commitments under the 2013 Amended Credit Agreement and therefore continue to be deferred, and are being amortized over the term of the 2013 Amended Credit Agreement. The remaining $7.5 million of unamortized deferred fees and the $2.2 million unamortized original issuance discount, all of which related to the 2011 term loan, were expensed as a $9.7 million loss on extinguishment of debt in the three months ended April 30, 2013. | |||||||||
Under the 2013 Amended Credit Agreement, we are required to pay a commitment fee equal to 0.50% per annum of the undrawn portion on the revolving credit facility, payable quarterly, and customary administrative agent and letter of credit fees. These fees are unchanged from the 2011 Credit Agreement. | |||||||||
The 2013 Amended Credit Agreement requires us to make term loan principal payments of $1.6 million per quarter commencing on May 1, 2013 and continuing through August 1, 2019, with the remaining balance due in September 2019. Optional prepayments of the loans are permitted without premium or penalty, other than customary breakage costs associated with the prepayment of loans bearing interest based on LIBO Rates and a 1.0% premium applicable in the event of a Repricing Transaction (as defined in the 2013 Amended Credit Agreement) prior to March 5, 2014. The loans are also subject to mandatory prepayment requirements with respect to certain asset sales, excess cash flows (as defined in the 2013 Amended Credit Agreement), and certain other events. Prepayments are applied first to the eight immediately following scheduled term loan principal payments, then pro rata to other remaining scheduled term loan principal payments, if any, and thereafter as otherwise provided in the 2013 Amended Credit Agreement. | |||||||||
As of October 31, 2013, future scheduled principal payments on the term loan under the 2013 Amended Credit Agreement are presented in the following table: | |||||||||
(in thousands) | |||||||||
Years Ending January 31, | Amount | ||||||||
2014 (remainder of year) | $ | 1,625 | |||||||
2015 | 6,500 | ||||||||
2016 | 6,500 | ||||||||
2017 | 6,500 | ||||||||
2018 | 6,500 | ||||||||
2019 and thereafter | 619,125 | ||||||||
Total | $ | 646,750 | |||||||
We incurred interest expense on borrowings under our credit facilities of $6.6 million and $19.7 million during the three and nine months ended October 31, 2013, respectively, and $6.8 million and $20.3 million during the three and nine months ended October 31, 2012, respectively. In addition, we recorded $0.5 million and $1.6 million, during the three and nine months ended October 31, 2013, respectively, for amortization of our deferred debt issuance costs, which is also reported within interest expense on our condensed consolidated statements of operations. We recorded $0.7 million and $2.1 million of amortization of our deferred debt issuance costs during the three and nine months ended October 31, 2012, respectively. | |||||||||
We recorded $0.1 million and $0.3 million during each of the three and nine months ended October 31, 2013 and October 31, 2012, respectively, for amortization of the original issuance term loan discounts, which is reported within interest expense. | |||||||||
Our obligations under the 2013 Amended Credit Agreement are guaranteed, in the same manner as under the 2011 Credit Agreement, by substantially all of our domestic subsidiaries and certain foreign subsidiaries that have elected to be disregarded for U.S. tax purposes, and are secured, in the same manner as under the 2011 Credit Agreement, by security interests in substantially all of our and their assets, subject to certain exceptions detailed in the 2013 Amended Credit Agreement and related ancillary documents. | |||||||||
The 2013 Amended Credit Agreement contains certain customary affirmative and negative covenants for credit facilities of this type, which covenants are substantially similar to those in the 2011 Credit Agreement. These covenants include limitations on us and our subsidiaries with respect to indebtedness, liens, nature of business, investments and loans, distributions, acquisitions, dispositions of assets, sale-leaseback transactions and transactions with affiliates. The revolving credit facility also contains a financial covenant that requires us to maintain a ratio of Consolidated Total Debt to Consolidated EBITDA (each as defined in the 2013 Amended Credit Agreement) of no greater than 5.00 to 1 until January 31, 2015 and no greater than 4.50 to 1 thereafter (the "Leverage Ratio Covenant"). The limitations imposed by the covenants are subject to certain exceptions as detailed in the 2013 Amended Credit Agreement. | |||||||||
The 2013 Amended Credit Agreement provides for certain customary events of default with corresponding grace periods. These events of default include failure to pay principal or interest when due under the 2013 Amended Credit Agreement, failure to comply with covenants, any representation or warranty made by us proving to be inaccurate in any material respect, defaults under certain other indebtedness of us or our subsidiaries, the occurrence of a Change of Control (as defined in the 2013 Amended Credit Agreement) with respect to us and certain insolvency or receivership events affecting us or our significant subsidiaries. Upon the occurrence of an event of default resulting from a violation of the Leverage Ratio Covenant, the lenders under our revolving credit facility may require us to immediately repay outstanding borrowings under the revolving credit facility and may terminate their commitments to provide loans under that facility. A violation of the Leverage Ratio Covenant would not, by itself, result in an event of default under the term loan but may trigger a cross-default under the term loan in the event we are required to repay outstanding borrowings under the revolving credit facility. Upon the occurrence of other events of default, the lenders may require us to immediately repay all outstanding borrowings under the 2013 Amended Credit Agreement and the lenders under our revolving credit facility may terminate their commitments to provide loans under the facility. | |||||||||
In connection with a business combination completed during the year ended January 31, 2012, we assumed approximately $3.3 million of development bank and government debt in the Americas region. The carrying value of this debt was $2.5 million at January 31, 2013. During the three months ended July 31, 2013, we repaid $2.0 million of this debt, resulting in a $0.2 million loss on extinguishment of debt, which is reported in the condensed consolidated statement of operations for the nine months ended October 31, 2013. The remaining portion of this debt has a carrying value of $0.1 million at October 31, 2013. |
SUPPLEMENTAL_CONDENSED_CONSOLI
SUPPLEMENTAL CONDENSED CONSOLIDATED FINANCIAL STATEMENT INFORMATION | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ||||||||||||||||
SUPPLEMENTAL CONDENSED CONSOLIDATED FINANCIAL STATEMENT INFORMATION | ' | ||||||||||||||||
SUPPLEMENTAL CONDENSED CONSOLIDATED FINANCIAL STATEMENT INFORMATION | |||||||||||||||||
Condensed Consolidated Balance Sheets | |||||||||||||||||
Inventories consisted of the following as of October 31, 2013 and January 31, 2013: | |||||||||||||||||
October 31, | January 31, | ||||||||||||||||
(in thousands) | 2013 | 2013 | |||||||||||||||
Raw materials | $ | 3,837 | $ | 4,263 | |||||||||||||
Work-in-process | 6,039 | 5,633 | |||||||||||||||
Finished goods | 4,997 | 5,118 | |||||||||||||||
Total inventories | $ | 14,873 | $ | 15,014 | |||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||||
Other expense, net consisted of the following for the three and nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Three Months Ended October 31, | Nine Months Ended October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Foreign currency (losses) gains, net | $ | 702 | $ | 1,144 | $ | (2,504 | ) | $ | 1,267 | ||||||||
Gains on derivative financial instruments, net | (721 | ) | (253 | ) | (45 | ) | (122 | ) | |||||||||
Other, net | (627 | ) | (1,231 | ) | (2,464 | ) | (1,334 | ) | |||||||||
Total other expense, net | $ | (646 | ) | $ | (340 | ) | $ | (5,013 | ) | $ | (189 | ) | |||||
Condensed Consolidated Statements of Cash Flows | |||||||||||||||||
The following table provides supplemental information regarding our condensed consolidated cash flows for the nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
October 31, | |||||||||||||||||
(in thousands) | 2013 | 2012 | |||||||||||||||
Cash paid for interest | $ | 17,724 | $ | 20,546 | |||||||||||||
Cash (refunds) payments of income taxes, net | $ | (6,463 | ) | $ | 14,807 | ||||||||||||
Non-cash investing and financing transactions: | |||||||||||||||||
Net non-cash assets acquired in CTI Merger | $ | 3,727 | $ | — | |||||||||||||
Accrued but unpaid purchases of property and equipment | $ | 1,217 | $ | 1,715 | |||||||||||||
Inventory transfers to property and equipment | $ | 658 | $ | 374 | |||||||||||||
Liabilities for contingent consideration in business combinations | $ | 4,557 | $ | — | |||||||||||||
Leasehold improvements funded by lease incentive | $ | — | $ | 5,014 | |||||||||||||
CONVERTIBLE_PREFERRED_STOCK
CONVERTIBLE PREFERRED STOCK | 9 Months Ended |
Oct. 31, 2013 | |
Temporary Equity Disclosure [Abstract] | ' |
CONVERTIBLE PREFERRED STOCK | ' |
CONVERTIBLE PREFERRED STOCK | |
On May 25, 2007, we entered into a Securities Purchase Agreement with CTI whereby CTI purchased, for cash, an aggregate of 293,000 shares of our Series A Convertible Preferred Stock, for an aggregate purchase price of $293.0 million. Proceeds from the issuance of the Preferred Stock were used to partially finance our May 2007 acquisition of Witness Systems Inc. ("Witness"). | |
On August 12, 2012, we entered into the CTI Merger Agreement providing for the CTI Merger. The CTI Merger was completed on February 4, 2013 and eliminated CTI's majority ownership and control of us. Each outstanding share of Preferred Stock, all of which was held by CTI, was canceled upon completion of the CTI Merger. As a result of the CTI Merger, our consolidated stockholders' equity was adjusted to reflect the $285.5 million carrying value of our Preferred Stock at February 4, 2013, as an increase to our additional paid-in capital. Further details regarding the CTI Merger appear in Note 4, "Merger with CTI". | |
The terms of the Preferred Stock provided that upon a fundamental change, as defined in the certificate of designation governing the Preferred Stock, the holders of the Preferred Stock would have had the right to require us to repurchase the Preferred Stock for 100% of the liquidation preference then in effect. Therefore, the Preferred Stock was classified as mezzanine equity on our condensed consolidated balance sheet as of January 31, 2013, separate from permanent equity, because the occurrence of such a fundamental change, and thus a potential required repurchase of the Preferred Stock, however remote in likelihood, was not solely under our control. | |
Under the CTI Merger Agreement, CTI had agreed that the CTI Merger and other transactions contemplated by the CTI Merger Agreement did not constitute fundamental change events under the terms of the Preferred Stock. | |
We concluded that, as of January 31, 2013, the occurrence of a fundamental change and the associated potential required repurchase of the Preferred Stock were not probable under the terms of the Securities Purchase Agreement. We therefore did not adjust the carrying amount of the Preferred Stock to its redemption amount, which was its liquidation preference, at January 31, 2013. Through January 31, 2013, cumulative, undeclared dividends on the Preferred Stock were $72.9 million and, as a result, the liquidation preference of the Preferred Stock was $365.9 million at that date. |
STOCKHOLDERS_EQUITY
STOCKHOLDERS' EQUITY | 9 Months Ended | ||||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||||
Stockholders' Equity Note [Abstract] | ' | ||||||||||||||||||
STOCKHOLDERS' EQUITY | ' | ||||||||||||||||||
STOCKHOLDERS’ EQUITY | |||||||||||||||||||
Dividends on Common Stock | |||||||||||||||||||
We did not declare or pay any dividends on our common stock during the nine months ended October 31, 2013 and 2012. | |||||||||||||||||||
We have been and continue to be subject to certain restrictions on declaring and paying dividends on our common stock under the terms of our credit facilities. We were also subject to certain restrictions on declaring and paying dividends on our common stock under the terms of our Preferred Stock, prior to its cancellation on February 4, 2013 in connection with the CTI Merger, further details of which appear in Note 4, "Merger with CTI". | |||||||||||||||||||
Treasury Stock | |||||||||||||||||||
Repurchased shares of common stock are recorded as treasury stock, at cost. At October 31, 2013 and January 31, 2013, we held 302,000 shares of treasury stock with a cost of $8.0 million. | |||||||||||||||||||
Shares of restricted stock awards that are forfeited when recipients separate from their employment prior to the lapsing of the award’s restrictions are recorded as treasury stock. | |||||||||||||||||||
From time to time, our board of directors has approved limited programs to repurchase shares of our common stock from directors or officers in connection with the vesting of restricted stock or restricted stock units to facilitate required income tax withholding by us or the payment of required income taxes by such holders. In addition, the terms of some of our equity award agreements with all grantees provide for automatic repurchases by us for the same purpose if a vesting-related or delivery-related tax event occurs at a time when the holder is not permitted to sell shares in the market. Our stock bonus program contains similar terms. Any such repurchases of common stock occur at prevailing market prices and are recorded as treasury stock. | |||||||||||||||||||
During the nine months ended October 31, 2013, we did not acquire any shares of treasury stock. During the nine months ended October 31, 2012, we acquired approximately 18,000 shares of treasury stock from directors, executive officers, and other employees at a cost of $0.5 million. | |||||||||||||||||||
As previously disclosed, in connection with the resumption of option exercises following the conclusion of our previous extended filing delay period and the vesting of restricted stock units after the relisting of our common stock on the NASDAQ Global Market, during the summer of 2010, we issued up to an aggregate of approximately 135,000 shares of common stock to certain current and former employees and a former director in transactions that did not involve public offerings and that were made in reliance on available exemptions from registration under the Securities Act. In April 2012, we repurchased 2,250 of these securities at a cost of less than $0.1 million, all of which were retired. The cost of the retired shares was deducted from common stock at par value, which was negligible, and from additional paid-in capital for the excess over par value. | |||||||||||||||||||
Accumulated Other Comprehensive Loss | |||||||||||||||||||
In addition to net income, accumulated other comprehensive income (loss) includes items such as foreign currency translation adjustments and unrealized gains and losses on certain marketable securities and derivative financial instruments designated as hedges. Accumulated other comprehensive income (loss) is presented as a separate line item in the stockholders’ equity section of our condensed consolidated balance sheets. Accumulated other comprehensive income (loss) items have no impact on our net income as presented in our condensed consolidated statements of operations. | |||||||||||||||||||
The following table summarizes changes in the components of our accumulated other comprehensive loss by component for the nine months ended October 31, 2013: | |||||||||||||||||||
(in thousands) | Unrealized Gains on Derivative Financial Instruments Designated as Hedges | Unrealized Gains on Available-for-Sale Investments | Foreign Currency Translation Adjustments | Total | |||||||||||||||
Accumulated other comprehensive income (loss) at January 31, 2013 | $ | 2,447 | $ | — | $ | (46,672 | ) | $ | (44,225 | ) | |||||||||
Other comprehensive income before reclassifications | 4,355 | 3 | 1,657 | 6,015 | |||||||||||||||
Amounts reclassified out of accumulated other comprehensive income (loss) | (4,041 | ) | — | — | (4,041 | ) | |||||||||||||
Net other comprehensive income (loss), current period | 314 | 3 | 1,657 | 1,974 | |||||||||||||||
Accumulated other comprehensive income (loss) at October 31, 2013 | $ | 2,761 | $ | 3 | $ | (45,015 | ) | $ | (42,251 | ) | |||||||||
All amounts presented in the table above are net of income taxes, if applicable. The accumulated net losses in foreign currency translation adjustments primarily reflect the strengthening of the U.S. dollar against the British pound sterling since our acquisition of Witness in May 2007, which has resulted in lower U.S. dollar-translated balances of British pound sterling-denominated goodwill and intangible assets associated with that acquisition. | |||||||||||||||||||
The amounts reclassified out of accumulated other comprehensive loss into the condensed consolidated condensed statements of operations, with presentation location, for the three months ended October 31, 2013 and 2012 were as follows: | |||||||||||||||||||
Three Months Ended | Nine Months Ended | Affected Line Items in the Condensed Consolidated Statements of Operations | |||||||||||||||||
October 31, | October 31, | ||||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||||
Unrealized (gains) losses on derivative financial instruments: | |||||||||||||||||||
Foreign currency forward contracts | $ | (167 | ) | $ | 37 | $ | (370 | ) | $ | 114 | Cost of product revenue | ||||||||
(178 | ) | 43 | (383 | ) | 109 | Cost of service revenue | |||||||||||||
(1,123 | ) | 238 | (2,455 | ) | 646 | Research and development | |||||||||||||
(516 | ) | 122 | (1,140 | ) | 336 | Selling, general and administrative | |||||||||||||
(1,984 | ) | 440 | (4,348 | ) | 1,205 | Total, before provision for income taxes | |||||||||||||
(174 | ) | 44 | (307 | ) | 119 | (Provision for) benefit from income taxes | |||||||||||||
$ | (1,810 | ) | $ | 396 | $ | (4,041 | ) | $ | 1,086 | Total, net of income taxes | |||||||||
Noncontrolling Interest | |||||||||||||||||||
The noncontrolling interest presented in our condensed consolidated financial statements reflects a 50% noncontrolling equity interest in a joint venture which functions as a systems integrator for Asian markets. Net income attributable to noncontrolling interest, as reported on our condensed consolidated statements of operations, represents the net income of this joint venture attributable to the noncontrolling equity interest. The noncontrolling interest is reflected within stockholders’ equity on the condensed consolidated balance sheet but is presented separately from our equity. |
INCOME_TAXES
INCOME TAXES | 9 Months Ended |
Oct. 31, 2013 | |
Income Tax Disclosure [Abstract] | ' |
INCOME TAXES | ' |
INCOME TAXES | |
Our interim provision for income taxes is measured using an estimated annual effective tax rate, adjusted for discrete items that occur within the periods presented. The comparison of our effective tax rate between periods is significantly impacted by the level and mix of earnings and losses by tax jurisdiction, foreign income tax rate differentials, amount of permanent book to tax differences, the impact of unrecognized tax benefits, and the effects of valuation allowances on certain loss jurisdictions. | |
For the three months ended October 31, 2013, we recorded a $6.0 million provision for income taxes on pre-tax income of $30.0 million, which represented an effective income tax rate of 19.8%. The income tax rate was lower than the 35% U.S. federal statutory rate primarily due to the mix and levels of income and losses among taxing jurisdictions. Although we did not recognize U.S. federal income tax benefits on losses incurred by certain domestic operations where we maintain valuation allowances, income from certain foreign subsidiaries was taxed at rates lower than the U.S. federal statutory rate. | |
For the three months ended October 31, 2012, we recorded a $2.2 million provision for income taxes on pre-tax income of $8.9 million, which represented an effective income tax rate of 25.3%. This effective income tax rate was lower than the 35% U.S. federal statutory rate primarily due to the mix and levels of income and losses among taxing jurisdictions and the recognition of previously unrecognized tax benefits, offset by the write-off of certain tax attributes resulting from the merger of certain foreign subsidiaries. Although we did not recognize U.S. federal income tax benefits on losses incurred by certain domestic operations where we maintain valuation allowances, income from certain foreign subsidiaries was taxed at rates lower than the U.S. federal statutory rate. | |
For the nine months ended October 31, 2013, we recorded an $11.9 million provision for income taxes on pre-tax income of $46.5 million, which represented an effective tax rate of 25.5%. The income tax provision does not include income tax benefit on losses incurred by certain domestic operations where we maintain valuation allowances and is mainly the result of the activities of profitable jurisdictions. The effective tax rate was also reduced because CTI received a favorable ruling from the Internal Revenue Service which resulted in adjustments to deferred taxes and an indemnified tax liability. Our pre-tax income in foreign jurisdictions, where we recorded tax provisions at rates lower than the U.S. federal statutory rate, was higher than domestic losses where we maintain valuation allowances and do not record tax benefits. | |
For the nine months ended October 31, 2012, we recorded a $9.4 million provision for income taxes on pre-tax income of $40.9 million, which represented an effective tax rate of 23.0%. The effective tax rate was lower than the U.S. federal statutory rate of 35% primarily due to the mix and levels of income and losses by jurisdiction and the recognition of previously unrecognized tax benefits, offset by the write-off of certain tax attributes resulting from the merger of certain foreign subsidiaries. We recorded an income tax provision on income from certain foreign subsidiaries taxed at rates lower than the U.S. federal statutory rate, but we did not recognize a U.S. federal income tax benefit on losses incurred by certain domestic operations because we maintain valuation allowances against the deferred tax assets, including those assets related to loss carryforwards. | |
As required by the authoritative guidance on accounting for income taxes, we evaluate the realizability of deferred tax assets on a jurisdictional basis at each reporting date. Accounting for income taxes guidance requires that a valuation allowance be established when it is more-likely-than-not that all or a portion of the deferred tax assets will not be realized. In circumstances where there is sufficient negative evidence indicating that the deferred tax assets are not more-likely-than-not realizable, we establish a valuation allowance. We determined that there is sufficient negative evidence to maintain the valuation allowances against our federal and certain state and foreign deferred tax assets as a result of historical losses in the most recent three-year period in the U.S. and in certain foreign jurisdictions. We intend to maintain valuation allowances until sufficient positive evidence exists to support a reversal. | |
We had unrecognized tax benefits of $142.1 million and $55.4 million (excluding interest and penalties) as of October 31, 2013 and January 31, 2013, respectively. The accrued liability for interest and penalties was $20.0 million and $8.3 million at October 31, 2013 and January 31, 2013, respectively. Interest and penalties are recorded as a component of the provision for income taxes in our condensed consolidated statements of operations. As of October 31, 2013 and January 31, 2013, the total amount of unrecognized tax benefits that, if recognized, would impact our effective tax rate were approximately $137.3 million and $50.8 million, respectively. We regularly assess the adequacy of our provisions for income tax contingencies in accordance with the applicable authoritative guidance on accounting for income taxes. As a result, we may adjust the reserves for unrecognized tax benefits for the impact of new facts and developments, such as changes to interpretations of relevant tax law, assessments from taxing authorities, settlements with taxing authorities, and lapses of statutes of limitation. Further, we believe that it is reasonably possible that the total amount of unrecognized tax benefits at October 31, 2013 could decrease by approximately $2.4 million in the next twelve months as a result of settlement of certain tax audits or lapses of statutes of limitation. Such decreases may involve the payment of additional taxes, the adjustment of deferred taxes including the need for additional valuation allowances, and the recognition of tax benefits. Our income tax returns are subject to ongoing tax examinations in several jurisdictions in which we operate. We also believe that it is reasonably possible that new issues may be raised by tax authorities or developments in tax audits may occur which would require increases or decreases to the balance of reserves for unrecognized tax benefits; however, an estimate of such changes cannot reasonably be made. |
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended | ||||||||||||
Oct. 31, 2013 | |||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||
FAIR VALUE MEASUREMENTS | ' | ||||||||||||
FAIR VALUE MEASUREMENTS | |||||||||||||
Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and consider assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance. | |||||||||||||
Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. An instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. This fair value hierarchy consists of three levels of inputs that may be used to measure fair value: | |||||||||||||
•Level 1: quoted prices in active markets for identical assets or liabilities; | |||||||||||||
• | Level 2: inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets 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 assets or liabilities; or | ||||||||||||
• | Level 3: unobservable inputs that are supported by little or no market activity. | ||||||||||||
Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. We review the fair value hierarchy classification of our applicable assets and liabilities on a quarterly basis. Changes in the observability of valuation inputs may result in transfers within the fair value measurement hierarchy. There were no transfers between levels of the fair value measurement hierarchy during the nine months ended October 31, 2013 and 2012. | |||||||||||||
Assets and Liabilities Measured at Fair Value on a Recurring Basis | |||||||||||||
Our assets and liabilities measured at fair value on a recurring basis consisted of the following as of October 31, 2013 and January 31, 2013: | |||||||||||||
October 31, 2013 | |||||||||||||
Fair Value Hierarchy Category | |||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | ||||||||||
Assets: | |||||||||||||
Money market funds | $ | 45,538 | $ | — | $ | — | |||||||
Short-term investments, classified as available-for-sale | — | 113,592 | — | ||||||||||
Foreign currency forward contracts | — | 3,262 | — | ||||||||||
Total assets | $ | 45,538 | $ | 116,854 | $ | — | |||||||
Liabilities: | |||||||||||||
Foreign currency forward contracts | $ | — | $ | 1,040 | $ | — | |||||||
Contingent consideration - business combinations | — | — | 10,869 | ||||||||||
Total liabilities | $ | — | $ | 1,040 | $ | 10,869 | |||||||
31-Jan-13 | |||||||||||||
Fair Value Hierarchy Category | |||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | ||||||||||
Assets: | |||||||||||||
Money market funds | $ | 62,085 | $ | — | $ | — | |||||||
Commercial paper (1) | — | 4,000 | — | ||||||||||
Foreign currency forward contracts | — | 2,854 | — | ||||||||||
Total assets | $ | 62,085 | $ | 6,854 | $ | — | |||||||
Liabilities: | |||||||||||||
Foreign currency forward contracts | $ | — | $ | 542 | $ | — | |||||||
Contingent consideration - business combinations | — | — | 25,041 | ||||||||||
Total liabilities | $ | — | $ | 542 | $ | 25,041 | |||||||
(1) Commerical paper investments with remaining maturities of three months or less at time of purchase, classified within cash and cash equivalents. | |||||||||||||
The following table presents the change in the estimated fair value of our liability for contingent consideration measured using significant unobservable inputs (Level 3) for the nine months ended October 31, 2013 and 2012: | |||||||||||||
Nine Months Ended | |||||||||||||
October 31, | |||||||||||||
(in thousands) | 2013 | 2012 | |||||||||||
Fair value measurement at beginning of period | $ | 25,041 | $ | 38,646 | |||||||||
Contingent consideration liabilities recorded for business combinations | 4,557 | — | |||||||||||
Changes in fair values, recorded in operating expenses | (1,635 | ) | (8,428 | ) | |||||||||
Payments of contingent consideration | (17,094 | ) | (6,902 | ) | |||||||||
Fair value measurement at end of period | $ | 10,869 | $ | 23,316 | |||||||||
Our estimated liability for contingent consideration represents potential payments of additional consideration for business combinations, payable if certain defined performance goals are achieved. Changes in fair value of contingent consideration are recorded in the condensed consolidated statements of operations within selling, general and administrative expenses. | |||||||||||||
Fair Value Measurements | |||||||||||||
Money Market Funds - We value our money market funds using quoted active market prices for such funds. | |||||||||||||
Short-term Investments - Short-term investments represent investments in commercial paper and corporate bonds classified as available-for-sale. Investments in commercial paper with remaining maturities of three months or less at time of purchase are classified within cash and cash equivalents. The fair values of these investments are estimated using observable market prices for identical securities that are traded in inactive markets, if available. When observable market prices for identical securities are not available, we value these short-term investments using non-binding market price quotes from brokers which we review for reasonableness using observable market data; quoted market prices for similar instruments; or pricing models, such as a discounted cash flow model. | |||||||||||||
Foreign Currency Forward Contracts - The estimated fair value of foreign currency forward contracts is based on quotes received from the counterparties thereto. These quotes are reviewed for reasonableness by discounting the future estimated cash flows under the contracts, considering the terms and maturities of the contracts and market exchange rates using readily observable market prices for similar contracts. | |||||||||||||
Contingent Consideration - Business Combinations - The fair value of the contingent consideration related to business combinations is estimated using a probability-adjusted discounted cash flow model. These fair value measurements are based on significant inputs not observable in the market. The key internally developed assumptions used in these models are discount rates and the probabilities assigned to the milestones to be achieved. We remeasure the fair value of the contingent consideration at each reporting period, and any changes in fair value resulting from either the passage of time or events occurring after the acquisition date, such as changes in discount rates, or in the expectations of achieving the performance targets, are recorded within selling, general, and administrative expenses. Increases or decreases in discount rates would have inverse impacts on the related fair value measurements, while favorable or unfavorable changes in expectations of achieving performance targets would result in corresponding increases or decreases in the related fair value measurements. We utilized discount rates ranging from 1.7% to 15.0% in our calculations of the estimated fair values of our contingent consideration liabilities as of October 31, 2013. We utilized discount rates ranging from 3.1% to 16.5% in our calculations of the estimated fair values of our contingent consideration liabilities as of October 31, 2012. | |||||||||||||
Other Financial Instruments | |||||||||||||
The carrying amounts of other short-term investments, accounts receivable, accounts payable, and accrued liabilities and other current liabilities approximate fair value due to their short maturities. | |||||||||||||
The estimated fair values of our term loan borrowings were $647.0 million and $583.0 million at October 31, 2013 and January 31, 2013, respectively. The estimated fair values of the term loan are based upon indicative bid and ask prices as determined by the agent responsible for the syndication of our term loan. We consider these inputs to be within Level 3 of the fair value hierarchy because we cannot reasonably observe activity in the limited market in which participations in our term loan are traded. The indicative prices provided to us as at each of October 31, 2013 and January 31, 2013 did not significantly differ from par value. | |||||||||||||
Assets and Liabilities Not Measured at Fair Value on a Recurring Basis | |||||||||||||
In addition to assets and liabilities that are measured at fair value on a recurring basis, we also measure certain assets and liabilities at fair value on a nonrecurring basis. Our non-financial assets, including goodwill, intangible assets and property, plant and equipment, are measured at fair value when there is an indication of impairment and the carrying amount exceeds the asset’s projected undiscounted cash flows. These assets are recorded at fair value only when an impairment charge is recognized. No such impairment charges were recorded during the three months ended October 31, 2013 and 2012. |
DERIVATIVE_FINANCIAL_INSTRUMEN
DERIVATIVE FINANCIAL INSTRUMENTS | 9 Months Ended | ||||||||||||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ||||||||||||||||||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS | |||||||||||||||||||||||||||
Our primary objective for holding derivative financial instruments is to manage foreign currency exchange rate risk and interest rate risk, when deemed appropriate. We enter into these contracts in the normal course of business to mitigate risks and not for speculative purposes. | |||||||||||||||||||||||||||
Foreign Currency Forward Contracts | |||||||||||||||||||||||||||
Under our risk management strategy, we periodically use derivative financial instruments to manage our short-term exposures to fluctuations in foreign currency exchange rates. We utilize foreign exchange forward contracts to hedge certain operational cash flow exposures resulting from changes in foreign currency exchange rates. These cash flow exposures result from portions of our forecasted operating expenses, primarily compensation and related expenses, which are transacted in currencies other than the U.S. dollar, primarily the Israeli shekel and the Canadian dollar. We also periodically utilize foreign currency forward contracts to manage exposures resulting from forecasted customer collections to be remitted in currencies other than the applicable functional currency, and exposures from cash, cash equivalents and short-term investments denominated in currencies other than the applicable functional currency. Our joint venture, which has a Singapore dollar functional currency, also utilizes foreign exchange forward contracts to manage its exposure to exchange rate fluctuations related to settlements of liabilities denominated in U.S. dollars. These foreign currency forward contracts are reported at fair value on our condensed consolidated balance sheets and generally have maturities of no longer than twelve months, although occasionally we will execute a contract that extends beyond twelve months, depending upon the nature of the underlying risk. | |||||||||||||||||||||||||||
The counterparties to our derivative financial instruments consist of several major international financial institutions. We regularly monitor the financial strength of these institutions. While the counterparties to these contracts expose us to credit-related losses in the event of a counterparty’s non-performance, the risk would be limited to the unrealized gains on such affected contracts. We do not anticipate any such losses. | |||||||||||||||||||||||||||
Certain of these foreign currency forward contracts are not designated as hedging instruments under accounting guidance for derivatives, and gains and losses from changes in their fair values are therefore reported in other income (expense), net. Changes in the fair values of foreign currency forward contracts that are designated and effective as cash flow hedges are recorded net of related tax effects in accumulated other comprehensive income (loss), and are reclassified to the condensed consolidated statements of operations when the effects of the item being hedged are recognized in the condensed consolidated statements of operations. | |||||||||||||||||||||||||||
Notional Amounts of Derivative Financial Instruments | |||||||||||||||||||||||||||
Our outstanding derivative financial instruments consisted only of foreign currency forward contracts with notional amounts of $121.0 million and $108.1 million as of October 31, 2013 and January 31, 2013, respectively. | |||||||||||||||||||||||||||
Fair Values of Derivative Financial Instruments | |||||||||||||||||||||||||||
The fair values of our derivative financial instruments as of October 31, 2013 and January 31, 2013 were as follows: | |||||||||||||||||||||||||||
31-Oct-13 | |||||||||||||||||||||||||||
Assets | Liabilities | ||||||||||||||||||||||||||
(in thousands) | Balance Sheet | Fair Value | Balance Sheet | Fair Value | |||||||||||||||||||||||
Classification | Classification | ||||||||||||||||||||||||||
Derivative financial instruments designated as hedging instruments: | |||||||||||||||||||||||||||
Foreign currency forward contracts | Prepaid expenses and other current assets | $ | 3,262 | Accrued expenses and other liabilities | $ | 236 | |||||||||||||||||||||
Total derivative financial instruments designated as hedging instruments | $ | 3,262 | $ | 236 | |||||||||||||||||||||||
Derivative financial instruments not designated as hedging instruments: | |||||||||||||||||||||||||||
Foreign currency forward contracts | — | $ | — | Accrued expenses and other liabilities | $ | 804 | |||||||||||||||||||||
Total derivative financial instruments not designated as hedging instruments | $ | — | $ | 804 | |||||||||||||||||||||||
31-Jan-13 | |||||||||||||||||||||||||||
Assets | Liabilities | ||||||||||||||||||||||||||
(in thousands) | Balance Sheet | Fair Value | Balance Sheet | Fair Value | |||||||||||||||||||||||
Classification | Classification | ||||||||||||||||||||||||||
Derivative financial instruments designated as hedging instruments: | |||||||||||||||||||||||||||
Foreign currency forward contracts | Prepaid expenses and other current assets | $ | 2,808 | Accrued expenses and other liabilities | $ | 64 | |||||||||||||||||||||
Total derivative financial instruments designated as hedging instruments | $ | 2,808 | $ | 64 | |||||||||||||||||||||||
Derivative financial instruments not designated as hedging instruments: | |||||||||||||||||||||||||||
Foreign currency forward contracts | Prepaid expenses and other current assets | $ | 46 | Accrued expenses and other liabilities | $ | 478 | |||||||||||||||||||||
Total derivative financial instruments not designated as hedging instruments | $ | 46 | $ | 478 | |||||||||||||||||||||||
Derivative Financial Instruments in Cash Flow Hedging Relationships | |||||||||||||||||||||||||||
The effects of derivative financial instruments designated as cash flow hedging instruments as of October 31, 2013 and January 31, 2013, and for the three and nine months ended October 31, 2013 and 2012 were as follows: | |||||||||||||||||||||||||||
Net Unrealized Gains Recognized in | Classification of Net Gains (Losses) Reclassified from Other Comprehensive Loss | Net Gains (Losses) Reclassified | |||||||||||||||||||||||||
Accumulated Other | into the Condensed Consolidated Statements of Operations | from Other Comprehensive Loss | |||||||||||||||||||||||||
Comprehensive Loss | into the Condensed Consolidated | ||||||||||||||||||||||||||
Statements of Operations | |||||||||||||||||||||||||||
October 31, | January 31, | Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
October 31, | October 31, | ||||||||||||||||||||||||||
(in thousands) | 2013 | 2013 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||
Foreign currency forward contracts | $ | 2,761 | $ | 2,447 | Operating Expenses | $ | 1,984 | $ | (440 | ) | $ | 4,348 | $ | (1,205 | ) | ||||||||||||
There were no gains or losses from ineffectiveness of these hedging instruments recorded for the nine months ended October 31, 2013 and 2012. All of the foreign currency forward contracts underlying the $2.8 million of net unrealized gains recorded in accumulated other comprehensive loss at October 31, 2013 mature within twelve months, and therefore we expect all such gains to be reclassified into earnings within the next twelve months. | |||||||||||||||||||||||||||
Derivative Financial Instruments Not Designated as Hedging Instruments | |||||||||||||||||||||||||||
Losses recognized on derivative financial instruments not designated as hedging instruments in our condensed consolidated statements of operations for the three and nine months ended October 31, 2013 and 2012 were as follows: | |||||||||||||||||||||||||||
Classification in Condensed Consolidated Statements of Operations | Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
October 31, | October 31, | ||||||||||||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||
Foreign currency forward contracts | Other expense, net | $ | (721 | ) | $ | (254 | ) | $ | (44 | ) | $ | (123 | ) |
STOCKBASED_COMPENSATION
STOCK-BASED COMPENSATION | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||||||
STOCK-BASED COMPENSATION | ' | ||||||||||||||||
STOCK-BASED COMPENSATION | |||||||||||||||||
We recognized stock-based compensation expense in the following line items on the condensed consolidated statements of operations for the three and nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Cost of revenue - product | $ | 243 | $ | 257 | $ | 572 | $ | 583 | |||||||||
Cost of revenue - service and support | 458 | 564 | 1,208 | 1,531 | |||||||||||||
Research and development, net | 890 | 769 | 2,432 | 1,906 | |||||||||||||
Selling, general and administrative | 8,138 | 5,095 | 20,942 | 14,298 | |||||||||||||
Total stock-based compensation expense | $ | 9,729 | $ | 6,685 | $ | 25,154 | $ | 18,318 | |||||||||
The following table summarizes stock-based compensation expense by type of award for the three and nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Stock options | $ | 45 | $ | 59 | $ | 152 | $ | 236 | |||||||||
Restricted stock awards and restricted stock units | 8,335 | 4,605 | 21,727 | 15,050 | |||||||||||||
Phantom stock units | 23 | 28 | 87 | 517 | |||||||||||||
Stock bonus program | 1,326 | 1,993 | 3,188 | 2,515 | |||||||||||||
Total stock-based compensation expense | $ | 9,729 | $ | 6,685 | $ | 25,154 | $ | 18,318 | |||||||||
Total stock-based compensation expense by classification was as follows for the three and nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Equity-classified awards | $ | 8,318 | $ | 4,550 | $ | 22,304 | $ | 15,022 | |||||||||
Stock bonus program | — | — | (298 | ) | 522 | ||||||||||||
Total equity-settled awards | 8,318 | 4,550 | 22,006 | 15,544 | |||||||||||||
Other liability-classified awards | 1,411 | 2,135 | 3,148 | 2,774 | |||||||||||||
Total stock-based compensation expense | $ | 9,729 | $ | 6,685 | $ | 25,154 | $ | 18,318 | |||||||||
Awards under our stock bonus program are accounted for as liability-classified awards because the obligations are based predominantly on fixed monetary amounts that are generally known at inception of the obligation, to be settled with a variable number of shares of our common stock. Amounts reported in the stock bonus program caption in the preceding table represent stock bonus expenses recognized in those periods for awards that were subsequently settled with equity during the nine months ended October 31, 2013 and 2012. Expenses associated with stock bonus program awards that remain outstanding as of October 31, 2013 and 2012 are reflected within other liability-classified awards in the preceding table. Our other liability-classified awards also include our phantom stock awards, the values of which track the market price of our common stock and are therefore subject to volatility, and which are settled with cash payments equivalent to the market value of our common stock upon vesting. Upon settlement of other liability-classified awards with equity, the current period's compensation expense associated with those awards is reported within equity-classified awards in the preceding table. | |||||||||||||||||
Stock Options | |||||||||||||||||
We have generally not granted stock options subsequent to January 31, 2006, other than in connection with several business combinations whereby stock options to purchase shares of the acquired companies were converted into stock options to purchase shares of our common stock. | |||||||||||||||||
The following table summarizes stock option activity and related information for the nine months ended October 31, 2013: | |||||||||||||||||
(in thousands, except per share data) | Number of Stock Options | Weighted-Average Exercise Price | |||||||||||||||
Outstanding at January 31, 2013 | 924 | $ | 31.88 | ||||||||||||||
Options exercised | (246 | ) | $ | 26.2 | |||||||||||||
Options forfeited or expired | (15 | ) | $ | 24.88 | |||||||||||||
Outstanding at October 31, 2013 | 663 | $ | 34.14 | ||||||||||||||
Options exercisable at October 31, 2013 | 658 | $ | 34.35 | ||||||||||||||
Cash proceeds received from the exercise of stock options were $6.4 million for the nine months ended October 31, 2013. | |||||||||||||||||
At October 31, 2013, there was approximately $0.1 million of unrecognized compensation expense, net of estimated forfeitures, related to unvested stock options that we expect to recognize over a weighted-average period of one year. | |||||||||||||||||
Restricted Stock Units and Restricted Stock Awards | |||||||||||||||||
We periodically award restricted stock units, as well as shares of restricted stock, to our directors, officers, and other employees. These awards contain various vesting conditions and are subject to certain restrictions and forfeiture provisions prior to vesting. | |||||||||||||||||
The following table summarizes restricted stock unit activity and related information for the nine months ended October 31, 2013: | |||||||||||||||||
(in thousands, except per share data) | Number of RSUs | Weighted-Average Grant Date Fair Value | |||||||||||||||
Outstanding at January 31, 2013 | 1,536 | $ | 31.42 | ||||||||||||||
RSUs granted | 1,537 | $ | 33.16 | ||||||||||||||
RSUs released | (776 | ) | $ | 31.67 | |||||||||||||
RSUs forfeited | (78 | ) | $ | 31.79 | |||||||||||||
Outstanding at October 31, 2013 | 2,219 | $ | 32.51 | ||||||||||||||
Activity presented in the table above includes shares earned and released under our stock bonus program, further details regarding which appear below under “Stock Bonus Program”. | |||||||||||||||||
The table above includes RSUs granted to executive officers and certain other employees that vest upon the achievement of specified performance goals. At each reporting date, we update our assessment of the probability that the specified performance criteria will be achieved and adjust the related stock-based compensation expenses of the performance-based RSUs, if necessary. We amortize the fair values of performance-based RSUs over the requisite service period for each separately vesting tranche of the award. | |||||||||||||||||
Substantially all of the restricted stock units granted during the year ended January 31, 2013 included a provision which allows these awards to be settled with cash payments upon vesting, rather than with delivery of common stock, at the discretion of our board of directors. As of October 31, 2013, for such awards that remain outstanding, settlement of these awards with cash payments was not considered probable, and therefore these awards have been accounted for as equity-classified awards. | |||||||||||||||||
As of October 31, 2013, there was approximately $52.8 million of total unrecognized compensation expense, net of estimated forfeitures, related to unvested restricted stock units, which is expected to be recognized over a weighted-average period of 2.2 years. | |||||||||||||||||
Phantom Stock Units | |||||||||||||||||
We have periodically issued phantom stock units to certain non-officer employees that settle, or are expected to settle, with cash payments upon vesting. Like equity-settled awards, phantom stock units are awarded with vesting conditions and are subject to certain forfeiture provisions prior to vesting. | |||||||||||||||||
During the nine months ended October 31, 2013, grants and forfeitures of phantom stock units were not significant. Total cash payments made upon vesting of phantom stock units for the nine months ended October 31, 2013 were $0.2 million. Total accrued liabilities for phantom stock units were $0.1 million and $0.2 million at October 31, 2013 and January 31, 2013, respectively. | |||||||||||||||||
Stock Bonus Program | |||||||||||||||||
We have a stock bonus program under which eligible employees may receive a portion of their annual or quarterly bonuses (depending on the employee’s bonus plan) in the form of fully vested shares of our common stock. Through January 31, 2013, executive officers were not eligible to participate in this program. This program is subject to annual funding approval by our board of directors and an annual cap on the number of shares that can be issued. Subject to these limitations, the number of shares to be issued under the program for a given year is determined using a five-day trailing average price of our common stock when the awards are calculated, reduced by a discount to be determined by the board of directors each year (the "discount"). To the extent that this program is not funded in a given year or the number of shares of common stock needed to fully satisfy employee enrollment exceeds the annual cap, the applicable portion of the employee bonuses will generally revert to being paid in cash. Obligations under this program are accounted for as liabilities, because the obligations are based predominantly on fixed monetary amounts that are generally known at inception of the obligation, to be settled with a variable number of shares of common stock determined using a discounted average price of our common stock, as described above. | |||||||||||||||||
For the year ended January 31, 2013, our board of directors approved up to 150,000 shares of common stock for awards under this program and a discount of 15%, (the "2013 stock bonus program"). Approximately 93,000 shares of our common stock were earned and issued to participants under the 2013 stock bonus program, including 80,000 shares issued during the nine months ended October 31, 2013, which completed our obligations under the 2013 stock bonus program. | |||||||||||||||||
On March 15, 2013, our board of directors approved up to 150,000 shares of common stock, and a discount of 15%, for awards under our stock bonus program for the year ending January 31, 2014 (the "2014 stock bonus program"). Executive officers are permitted to participate in the 2014 stock bonus program, but only to the extent that shares remain available for awards following the enrollment of all other participants. Shares awarded to executive officers with respect to the 15% discount will be subject to a one year vesting period. | |||||||||||||||||
Total accrued liabilities for stock bonus programs were $3.5 million and $3.1 million as of October 31, 2013 and January 31, 2013, respectively. |
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Oct. 31, 2013 | |
Related Party Transactions [Abstract] | ' |
RELATED PARTY TRANSACTIONS | ' |
RELATED PARTY TRANSACTIONS | |
Transactions with CTI | |
As discussed in Note 4, "Merger with CTI", on February 4, 2013 we completed the CTI Merger, which eliminated CTI's majority ownership and control of us. As of January 31, 2013, prior to the CTI Merger, CTI beneficially owned approximately 53.5%, and also held a majority of the voting power, of our common stock on an as-converted basis. | |
During the three months ended April 30, 2012, we paid $0.3 million to a subsidiary of CTI for its assignment to us of user licenses for certain third-party internal-use software. | |
Other Related Party Transactions | |
Our joint venture incurs certain operating expenses, including office rent and other administrative costs, and realizes revenue, under arrangements with one of its noncontrolling shareholders. Transactions with this shareholder during the three and nine months ended October 31, 2013 were not significant. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended | ||||||||
Oct. 31, 2013 | |||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||||
COMMITMENTS AND CONTINGENCIES | ' | ||||||||
COMMITMENTS AND CONTINGENCIES | |||||||||
Warranty Liability | |||||||||
The following table summarizes the activity in our warranty liability, which is included in accrued expenses and other liabilities in the condensed consolidated balance sheets, for the nine months ended October 31, 2013 and 2012: | |||||||||
Nine Months Ended | |||||||||
October 31, | |||||||||
(in thousands) | 2013 | 2012 | |||||||
Warranty liability, beginning of period | $ | 1,045 | $ | 2,015 | |||||
Provisions credited to expenses | (253 | ) | (701 | ) | |||||
Warranty charges | — | (188 | ) | ||||||
Foreign currency translation and other | (2 | ) | (8 | ) | |||||
Warranty liability, end of period | $ | 790 | $ | 1,118 | |||||
Legal Proceedings | |||||||||
On March 26, 2009, legal actions were commenced by Ms. Orit Deutsch, a former employee of our subsidiary, Verint Systems Limited ("VSL"), against VSL in the Tel Aviv Regional Labor Court (Case Number 4186/09) (the “Deutsch Labor Action”) and against CTI in the Tel Aviv Regional District Court (Case Number 1335/09) (the “Deutsch District Action”). In the Deutsch Labor Action, Ms. Deutsch filed a motion to approve a class action lawsuit on the grounds that she purports to represent a class of our employees and former employees who were granted Verint and CTI stock options and were allegedly damaged as a result of the suspension on option exercises during our previous extended filing delay period. In the Deutsch District Action, in addition to a small amount of individual damages, Ms. Deutsch is seeking to certify a class of plaintiffs who were allegedly damaged due to their inability to exercise Verint and CTI stock options as a result of alleged negligence by CTI in its financial reporting. The class certification motions do not specify an amount of damages. On February 8, 2010, the Deutsch Labor Action was dismissed for lack of material jurisdiction and was transferred to the Tel Aviv Regional District Court and consolidated with the Deutsch District Action. On March 16, 2009 and March 26, 2009, respectively, legal actions were commenced by Ms. Roni Katriel, a former employee of CTI's former subsidiary, Comverse Limited, against Comverse Limited in the Tel Aviv Regional Labor Court (Case Number 3444/09) (the “Katriel Labor Action”) and against CTI in the Tel Aviv Regional District Court (Case Number 1334/09) (the “Katriel District Action”). In the Katriel Labor Action, Ms. Katriel is seeking to certify a class of plaintiffs who were granted CTI stock options and were allegedly damaged as a result of the suspension on option exercises during CTI's previous extended filing delay period. In the Katriel District Action, in addition to a small amount of individual damages, Ms. Katriel is seeking to certify a class of plaintiffs who were allegedly damaged due to their inability to exercise CTI stock options as a result of alleged negligence by CTI in its financial reporting. The class certification motions do not specify an amount of damages. On March 2, 2010, the Labor Court ordered the transfer of the case to the District Court in Tel Aviv - Jaffa, based on an agreed motion filed by the parties requesting such transfer. | |||||||||
On April 4, 2012, Ms. Deutsch and Ms. Katriel filed an uncontested motion to consolidate and amend their claims and on June 7, 2012, the court allowed Ms. Deutsch and Ms. Katriel to file the consolidated class certification motion and an amended consolidated complaint against VSL, CTI, and Comverse Limited. Following CTI's announcement of its intention to effect the Comverse share distribution, on July 12, 2012, the plaintiffs filed a motion requesting that the District Court order CTI to set aside up to $150.0 million in assets to secure any future judgment. The District Court ruled that it would not decide this motion until the Deutsch and Katriel class certification motion was heard. On August 16, 2012, in light of the announcement of the signing of the CTI Merger Agreement, the plaintiffs filed a motion for leave to appeal this District Court ruling to the Israeli Supreme Court. We filed our response to this motion on September 6, 2012. | |||||||||
Prior to the consummation of the Comverse share distribution, CTI either sold or transferred substantially all of its business operations and assets (other than its equity ownership interests in us and Comverse) to Comverse or unaffiliated third parties. On October 31, 2012, CTI completed the Comverse share distribution, in which it distributed all of the outstanding shares of common stock of Comverse to CTI's shareholders. As a result of the Comverse share distribution, Comverse became an independent public company and ceased to be a wholly owned subsidiary of CTI, and CTI ceased to have any material assets other than its equity interest in us. | |||||||||
We and the other defendants filed our responses to the complaint on November 11, 2012 and plaintiffs filed their replies on December 20, 2012. A pre-trial hearing for the case was held on December 25, 2012, during which all parties agreed to attempt to settle the dispute through mediation. | |||||||||
On February 4, 2013, we completed the CTI Merger. As a result of the CTI Merger, we have assumed certain rights and liabilities of CTI, including any liability of CTI arising out of the Deutsch District Action and the Katriel District Action. However, under the terms of the Distribution Agreement between CTI and Comverse relating to the Comverse share distribution, we, as successor to CTI, are entitled to indemnification from Comverse for any losses we suffer in our capacity as successor-in-interest to CTI in connection with the Deutsch District Action and the Katriel District Action. | |||||||||
On February 28, 2013, the mediation process began and, as of the date of this report, remains ongoing. | |||||||||
From time to time we or our subsidiaries may be involved in legal proceedings and/or litigation arising in the ordinary course of our business. While the outcome of these matters cannot be predicted with certainty, we do not believe that the outcome of any current claims will have a material effect on our consolidated financial position, results of operations, or cash flows. |
SEGMENT_INFORMATION
SEGMENT INFORMATION | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
SEGMENT INFORMATION | ' | ||||||||||||||||
SEGMENT INFORMATION | |||||||||||||||||
Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the enterprise’s chief operating decision maker ("CODM"), or decision making group, in deciding how to allocate resources and in assessing performance. Our Chief Executive Officer is our CODM. | |||||||||||||||||
We conduct our business in three operating segments — Enterprise Intelligence, Video Intelligence and Communications Intelligence. | |||||||||||||||||
Our Enterprise Intelligence solutions help large organizations and small-to-medium sized business organizations to extract and analyze valuable information from customer interactions and related operational and transactional data for the purpose of optimizing the performance of their customer service operations, including contact centers, back offices, branches, and remote locations. | |||||||||||||||||
Our Video Intelligence solutions help organizations enhance safety and security by enabling them to deploy an end-to-end IP video solution with integrated analytics or evolve to IP video operations without discarding their investments in analog Closed Circuit Television technology. | |||||||||||||||||
Our Communications Intelligence solutions are designed to generate evidence and intelligence and are used to detect and neutralize criminal and terrorist threats. | |||||||||||||||||
We measure the performance of our operating segments based upon operating segment revenue and operating segment contribution. Operating segment contribution includes segment revenue and expenses incurred directly by the segment, including material costs, service costs, research and development and selling, marketing, and administrative expenses. We do not allocate certain expenses, which include the majority of general and administrative expenses, facilities and communication expenses, purchasing expenses, manufacturing support and logistic expenses, depreciation and amortization, amortization of capitalized software development costs, stock-based compensation, and special charges such as restructuring costs when calculating operating segment contribution. These expenses are included in the unallocated expenses section of the table presented below. Revenue from transactions between our operating segments is not material. | |||||||||||||||||
Revenue adjustments for the three and nine months ended October 31, 2013 and 2012 represent revenue of acquired companies which is included within segment revenue reviewed by the CODM, but not recognizable within GAAP revenue. These adjustments primarily relate to the acquisition-date excess of the historical carrying value over the fair value of acquired companies’ future maintenance and service performance obligations. As the obligations are satisfied, we report our segment revenue using the historical carrying values of these obligations, which we believe better reflects our ongoing maintenance and service revenue streams, whereas GAAP revenue is reported using the obligations’ acquisition-date fair values. | |||||||||||||||||
With the exception of goodwill and acquired intangible assets, we do not identify or allocate our assets by operating segment. Consequently, it is not practical to present assets by operating segment. There were no material changes in the allocation of goodwill and acquired intangible assets by operating segment during the nine months ended October 31, 2013 and 2012. The allocations of goodwill and acquired intangible assets by operating segment appear in Note 6, "Intangible Assets and Goodwill". | |||||||||||||||||
Operating results by segment for the three and nine months ended October 31, 2013 and 2012 were as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Revenue: | |||||||||||||||||
Enterprise Intelligence | |||||||||||||||||
Segment revenue | $ | 126,220 | $ | 122,245 | $ | 365,385 | $ | 351,659 | |||||||||
Revenue adjustments | (323 | ) | (443 | ) | (692 | ) | (3,655 | ) | |||||||||
125,897 | 121,802 | 364,693 | 348,004 | ||||||||||||||
Video Intelligence | |||||||||||||||||
Segment revenue | 27,287 | 25,587 | 88,388 | 93,916 | |||||||||||||
Revenue adjustments | — | (348 | ) | (167 | ) | (1,840 | ) | ||||||||||
27,287 | 25,239 | 88,221 | 92,076 | ||||||||||||||
Communications Intelligence | |||||||||||||||||
Segment revenue | 71,249 | 54,817 | 199,163 | 172,381 | |||||||||||||
Revenue adjustments | (119 | ) | (338 | ) | (530 | ) | (1,880 | ) | |||||||||
71,130 | 54,479 | 198,633 | 170,501 | ||||||||||||||
Total revenue | $ | 224,314 | $ | 201,520 | $ | 651,547 | $ | 610,581 | |||||||||
Segment contribution: | |||||||||||||||||
Enterprise Intelligence | $ | 56,772 | $ | 52,139 | $ | 155,169 | $ | 147,102 | |||||||||
Video Intelligence | 5,546 | 3,992 | 20,482 | 23,027 | |||||||||||||
Communications Intelligence | 24,457 | 18,693 | 62,223 | 49,826 | |||||||||||||
Total segment contribution | 86,775 | 74,824 | 237,874 | 219,955 | |||||||||||||
Unallocated expenses, net: | |||||||||||||||||
Amortization of acquired intangible assets | 8,085 | 9,805 | 26,113 | 29,466 | |||||||||||||
Stock-based compensation | 9,729 | 6,685 | 25,154 | 18,318 | |||||||||||||
Other unallocated expenses | 31,130 | 41,563 | 103,800 | 108,154 | |||||||||||||
Total unallocated expenses, net | 48,944 | 58,053 | 155,067 | 155,938 | |||||||||||||
Operating income | 37,831 | 16,771 | 82,807 | 64,017 | |||||||||||||
Other expense, net | (7,820 | ) | (7,913 | ) | (36,316 | ) | (23,093 | ) | |||||||||
Income before provision for income taxes | $ | 30,011 | $ | 8,858 | $ | 46,491 | $ | 40,924 | |||||||||
SUBSEQUENT_EVENT_SUBSEQUENT_EV
SUBSEQUENT EVENT SUBSEQUENT EVENT | 9 Months Ended |
Oct. 31, 2013 | |
Subsequent Event [Abstract] | ' |
SUBSEQUENT EVENT | ' |
SUBSEQUENT EVENT | |
On November 6, 2013, we acquired certain technology and other assets for use in our Communications Intelligence operating segment in a transaction that qualified as a business combination. This business combination was not material to our condensed consolidated financial statements. |
BASIS_OF_PRESENTATION_AND_SIGN1
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Oct. 31, 2013 | |
Accounting Policies [Abstract] | ' |
Principles of Consolidation | ' |
Principles of Consolidation | |
The accompanying condensed consolidated financial statements include the accounts of Verint Systems Inc., our wholly owned subsidiaries, and a joint venture in which we hold a 50% equity interest. This joint venture functions as a systems integrator for Asian markets and is a variable interest entity in which we are the primary beneficiary. Investments in companies in which we have less than a 20% ownership interest and do not exercise significant influence are accounted for at cost. We include the results of operations of acquired companies from the date of acquisition. All significant intercompany transactions and balances are eliminated. | |
Use of Estimates | ' |
Use of Estimates | |
The preparation of financial statements in conformity with GAAP requires our management to make estimates and assumptions, which may affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | |
New Accounting Pronouncements | ' |
New Accounting Pronouncements | |
New Accounting Pronouncements Implemented | |
In July 2012, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2012-02, Intangibles—Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment, which simplifies how entities test indefinite-lived intangible assets for impairment and improves consistency in impairment testing requirements among long-lived asset categories. These amended standards permit an assessment of qualitative factors to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying value. For assets in which this assessment concludes that it is more likely than not that the fair value is more than its carrying value, these amended standards eliminate the requirement to perform quantitative impairment testing. The amended guidance is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012, with early adoption permitted. Our adoption of this guidance effective February 1, 2013 did not materially impact our condensed consolidated financial statements. | |
In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income, which contained amended standards regarding disclosure requirements for items reclassified out of accumulated other comprehensive income ("AOCI"). These amended standards require the disclosure of information about the amounts reclassified out of AOCI by component and, in addition, require disclosure, either on the face of the financial statements or in the notes, of significant amounts reclassified out of AOCI by the respective line items of net income, but only if the amount reclassified is required to be reclassified in its entirety in the same reporting period. For amounts that are not required to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional details about those amounts. These amended standards do not change the current requirements for reporting net income or other comprehensive income in the condensed consolidated financial statements. These amended standards were effective for us on February 1, 2013, and adoption of this guidance did not materially impact our condensed consolidated financial statements. The disclosures required by the amended standards appear in Note 10, "Stockholders' Equity". | |
In July 2013, the FASB issued ASU No. 2013-10, Derivatives and Hedging (Topic 815): Inclusion of the Fed Funds Effective Swap Rate (or Overnight Index Swap Rate) as a Benchmark Interest Rate for Hedge Accounting Purposes, permitting entities to use the Fed Funds Effective Swap Rate as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815, in addition to the U.S. Treasury rate and the London Interbank Offered Rate (LIBOR). The amendments also remove the restriction on using different benchmark rates for similar hedges. The amendments in this ASU were effective prospectively for qualifying new or redesignated hedging relationships entered into on or after July 17, 2013. We adopted the amendments in this ASU effective July 17, 2013, and the initial adoption of the amendments in this ASU did not impact our condensed consolidated financial statements. | |
New Accounting Pronouncements To Be Implemented | |
In March 2013, the FASB issued ASU No. 2013-05, Foreign Currency Matters (Topic 830): Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity. This new standard is intended to resolve diversity in practice regarding the release into net income of a cumulative translation adjustment upon derecognition of a subsidiary or group of assets within a foreign entity. ASU No. 2013-05 is effective prospectively for fiscal years (and interim reporting periods within those years) beginning after December 15, 2013. We are currently reviewing this standard, but we do not anticipate that its adoption will have a material impact on our condensed consolidated financial statements, absent any material transactions involving the derecognition of subsidiaries or groups of assets within a foreign entity. | |
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. ASU No. 2013-11 requires that entities with an unrecognized tax benefit and a net operating loss carryforward or similar tax loss or tax credit carryforward in the same jurisdiction as the uncertain tax position present the unrecognized tax benefit as a reduction of the deferred tax asset for the loss or tax credit carryforward rather than as a liability, when the uncertain tax position would reduce the loss or tax credit carryforward under the tax law, thereby eliminating diversity in practice regarding this presentation issue. This new guidance is effective prospectively for annual reporting periods beginning on or after December 15, 2013, although retrospective application in permitted. We are currently assessing the impact of this guidance, if any, on our condensed consolidated financial statements. |
NET_INCOME_PER_COMMON_SHARE_AT1
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC. (Tables) | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
Schedule of calculation of basic and diluted net income per common share attributable to Verint Systems Inc. | ' | ||||||||||||||||
The following table summarizes the calculation of basic and diluted net income per common share attributable to Verint Systems Inc. for the three and nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands, except per share amounts) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Net income | $ | 24,054 | $ | 6,615 | $ | 34,622 | $ | 31,510 | |||||||||
Net income attributable to noncontrolling interest | 1,567 | 1,144 | 3,752 | 3,397 | |||||||||||||
Net income attributable to Verint Systems Inc. | 22,487 | 5,471 | 30,870 | 28,113 | |||||||||||||
Dividends on Preferred Stock | — | (3,909 | ) | (174 | ) | (11,521 | ) | ||||||||||
Net income attributable to Verint Systems Inc. for basic net income per common share | 22,487 | 1,562 | 30,696 | 16,592 | |||||||||||||
Dilutive effect of dividends on Preferred Stock | — | — | — | — | |||||||||||||
Net income attributable to Verint Systems Inc. for diluted net income per common share | $ | 22,487 | $ | 1,562 | $ | 30,696 | $ | 16,592 | |||||||||
Weighted-average shares outstanding: | |||||||||||||||||
Basic | 53,374 | 39,785 | 52,781 | 39,622 | |||||||||||||
Dilutive effect of employee equity award plans | 572 | 137 | 780 | 472 | |||||||||||||
Dilutive effect of assumed conversion of Preferred Stock | — | — | — | — | |||||||||||||
Diluted | 53,946 | 39,922 | 53,561 | 40,094 | |||||||||||||
Net income per common share attributable to Verint Systems Inc.: | |||||||||||||||||
Basic | $ | 0.42 | $ | 0.04 | $ | 0.58 | $ | 0.42 | |||||||||
Diluted | $ | 0.42 | $ | 0.04 | $ | 0.57 | $ | 0.41 | |||||||||
Schedule of anti-dilutive securities | ' | ||||||||||||||||
We excluded the following weighted-average common shares underlying stock-based awards and the assumed conversion of our Preferred Stock from the calculations of diluted net income per common share because their inclusion would have been anti-dilutive: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Common shares excluded from calculation: | |||||||||||||||||
Stock options and restricted stock-based awards | 343 | 1,348 | 263 | 888 | |||||||||||||
Convertible Preferred Stock | — | 11,095 | 164 | 10,989 | |||||||||||||
CASH_CASH_EQUIVALENTS_AND_SHOR1
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS (Tables) | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Cash, Cash Equivalents, and Short-term Investments [Abstract] | ' | ||||||||||||||||
Schedule of Cash, Cash Equivalents and Short-term Investments | ' | ||||||||||||||||
The following tables summarize our cash, cash equivalents and short-term investments as of October 31, 2013 and January 31, 2013: | |||||||||||||||||
31-Oct-13 | |||||||||||||||||
(in thousands) | Cost Basis | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | |||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Cash and bank time deposits | $ | 191,922 | $ | — | $ | — | $ | 191,922 | |||||||||
Money market funds | 45,538 | — | — | 45,538 | |||||||||||||
Total cash and cash equivalents | $ | 237,460 | $ | — | $ | — | $ | 237,460 | |||||||||
Short-term investments: | |||||||||||||||||
Commercial paper and corporate debt securities (available-for-sale) | $ | 113,589 | $ | 3 | $ | — | $ | 113,592 | |||||||||
Bank time deposits | 25,259 | — | — | 25,259 | |||||||||||||
Total short-term investments | $ | 138,848 | $ | 3 | $ | — | $ | 138,851 | |||||||||
31-Jan-13 | |||||||||||||||||
(in thousands) | Cost Basis | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | |||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Cash and bank time deposits | $ | 143,888 | $ | — | $ | — | $ | 143,888 | |||||||||
Money market funds | 62,085 | — | — | 62,085 | |||||||||||||
Commercial paper | 4,000 | — | — | 4,000 | |||||||||||||
Total cash and cash equivalents | $ | 209,973 | $ | — | $ | — | $ | 209,973 | |||||||||
Short-term investments: | |||||||||||||||||
Bank time deposits | $ | 13,593 | $ | — | $ | — | $ | 13,593 | |||||||||
Total short-term investments | $ | 13,593 | $ | — | $ | — | $ | 13,593 | |||||||||
BUSINESS_COMBINATIONS_BUSINESS1
BUSINESS COMBINATIONS BUSINESS COMBINATIONS (Tables) | 9 Months Ended | ||||
Oct. 31, 2013 | |||||
Business Combinations [Abstract] | ' | ||||
Schedule of Purchase Price Allocation [Table Text Block] | ' | ||||
The following table sets forth the components and the allocations of the purchase prices for the two business combinations completed during the three months ended October 31, 2013. These purchase price allocations have been prepared on a preliminary basis and changes to those allocations may occur as additional information becomes available during the respective measurement periods (up to one year from the respective acquisition dates). | |||||
(in thousands) | Amount | ||||
Components of Combined Purchase Price: | |||||
Cash | $ | 10,853 | |||
Fair value of contingent consideration | 4,557 | ||||
Total Combined Purchase Price | $ | 15,410 | |||
Allocation of Combined Purchase Price: | |||||
Net tangible liabilities: | |||||
Accounts receivable | $ | 1,545 | |||
Other current assets, including cash acquired | 1,468 | ||||
Other assets | 245 | ||||
Current and other liabilities | (1,118 | ) | |||
Deferred revenue | (760 | ) | |||
Deferred income taxes, net - current and long-term | (2,164 | ) | |||
Net tangible liabilities | (784 | ) | |||
Identifiable intangible assets: | |||||
Customer relationships | 6,809 | ||||
Developed technology | 1,209 | ||||
Trademarks and trade names | 409 | ||||
Total identifiable intangible assets | 8,427 | ||||
Goodwill | 7,767 | ||||
Total Combined Purchase Price | $ | 15,410 | |||
INTANGIBLE_ASSETS_AND_GOODWILL1
INTANGIBLE ASSETS AND GOODWILL (Tables) | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||
Schedule of acquisition-related intangible assets | ' | ||||||||||||||||
Acquisition-related intangible assets consisted of the following as of October 31, 2013 and January 31, 2013: | |||||||||||||||||
October 31, 2013 | |||||||||||||||||
(in thousands) | Cost | Accumulated | Net | ||||||||||||||
Amortization | |||||||||||||||||
Intangible assets with finite lives: | |||||||||||||||||
Customer relationships | $ | 232,256 | $ | (135,140 | ) | $ | 97,116 | ||||||||||
Acquired technology | 95,733 | (72,612 | ) | 23,121 | |||||||||||||
Trade names | 13,113 | (11,085 | ) | 2,028 | |||||||||||||
Non-competition agreements | 5,516 | (4,785 | ) | 731 | |||||||||||||
Distribution network | 2,440 | (1,779 | ) | 661 | |||||||||||||
Backlog | 843 | (114 | ) | 729 | |||||||||||||
Total intangible assets with finite lives | 349,901 | (225,515 | ) | 124,386 | |||||||||||||
In-process research and development, with indefinite lives | 1,700 | — | 1,700 | ||||||||||||||
Total | $ | 351,601 | $ | (225,515 | ) | $ | 126,086 | ||||||||||
January 31, 2013 | |||||||||||||||||
(in thousands) | Cost | Accumulated | Net | ||||||||||||||
Amortization | |||||||||||||||||
Intangible assets with finite lives: | |||||||||||||||||
Customer relationships | $ | 225,321 | $ | (117,903 | ) | $ | 107,418 | ||||||||||
Acquired technology | 93,860 | (64,617 | ) | 29,243 | |||||||||||||
Trade names | 12,737 | (10,537 | ) | 2,200 | |||||||||||||
Non-competition agreements | 5,516 | (4,227 | ) | 1,289 | |||||||||||||
Distribution network | 2,440 | (1,596 | ) | 844 | |||||||||||||
Backlog | 843 | (76 | ) | 767 | |||||||||||||
Total intangible assets with finite lives | 340,717 | (198,956 | ) | 141,761 | |||||||||||||
In-process research and development, with indefinite lives | 2,500 | — | 2,500 | ||||||||||||||
Total | $ | 343,217 | $ | (198,956 | ) | $ | 144,261 | ||||||||||
Schedule of net acquisition-related intangible assets by reportable segment | ' | ||||||||||||||||
The following table presents net acquisition-related intangible assets by reportable segment as of October 31, 2013 and January 31, 2013: | |||||||||||||||||
October 31, | January 31, | ||||||||||||||||
(in thousands) | 2013 | 2013 | |||||||||||||||
Enterprise Intelligence | $ | 111,291 | $ | 126,341 | |||||||||||||
Video Intelligence | 3,002 | 3,880 | |||||||||||||||
Communications Intelligence | 11,793 | 14,040 | |||||||||||||||
Total | $ | 126,086 | $ | 144,261 | |||||||||||||
Schedule of estimated future amortization expense on finite-lived acquisition-related intangible assets | ' | ||||||||||||||||
Estimated future amortization expense on finite-lived acquisition-related intangible assets as of October 31, 2013 is as follows: | |||||||||||||||||
(in thousands) | |||||||||||||||||
Years Ending January 31, | Amount | ||||||||||||||||
2014 (remainder of year) | $ | 8,544 | |||||||||||||||
2015 | 32,491 | ||||||||||||||||
2016 | 30,806 | ||||||||||||||||
2017 | 27,873 | ||||||||||||||||
2018 | 11,575 | ||||||||||||||||
2019 and thereafter | 13,097 | ||||||||||||||||
Total | $ | 124,386 | |||||||||||||||
Schedule of goodwill activity | ' | ||||||||||||||||
Goodwill activity and related information for the nine months ended October 31, 2013, in total and by reportable segment, was as follows: | |||||||||||||||||
Reportable Segment | |||||||||||||||||
(in thousands) | Total | Enterprise | Video | Communications | |||||||||||||
Intelligence | Intelligence | Intelligence | |||||||||||||||
Goodwill, gross, at January 31, 2013 | $ | 896,774 | $ | 771,738 | $ | 76,803 | $ | 48,233 | |||||||||
Accumulated impairment losses through January 31, 2013 | (66,865 | ) | (30,791 | ) | (36,074 | ) | — | ||||||||||
Goodwill, net, at January 31, 2013 | 829,909 | 740,947 | 40,729 | 48,233 | |||||||||||||
Business combinations | 7,767 | 7,055 | — | 712 | |||||||||||||
Foreign currency translation and other | 1,046 | 1,637 | 6 | (597 | ) | ||||||||||||
Goodwill, net, at October 31, 2013 | $ | 838,722 | $ | 749,639 | $ | 40,735 | $ | 48,348 | |||||||||
Goodwill, net, at October 31, 2013: | |||||||||||||||||
Goodwill, gross, at October 31, 2013 | $ | 905,587 | $ | 780,430 | $ | 76,809 | $ | 48,348 | |||||||||
Accumulated impairment losses through October 31, 2013 | (66,865 | ) | (30,791 | ) | (36,074 | ) | — | ||||||||||
Goodwill, net, at October 31, 2013 | $ | 838,722 | $ | 749,639 | $ | 40,735 | $ | 48,348 | |||||||||
LONGTERM_DEBT_Tables
LONG-TERM DEBT (Tables) | 9 Months Ended | ||||||||
Oct. 31, 2013 | |||||||||
Long-term Debt, Unclassified [Abstract] | ' | ||||||||
Summary of long-term debt | ' | ||||||||
The following table summarizes our long-term debt at October 31, 2013 and January 31, 2013: | |||||||||
October 31, | January 31, | ||||||||
(in thousands) | 2013 | 2013 | |||||||
Term loan facility - 2013 Amended Credit Agreement: | |||||||||
Outstanding borrowings | $ | 646,750 | $ | — | |||||
Unamortized debt discount | (2,944 | ) | — | ||||||
Term loan facility - 2011 Credit Agreement: | |||||||||
Outstanding borrowings | — | 576,000 | |||||||
Unamortized debt discount | — | (2,199 | ) | ||||||
Other debt | 109 | 2,888 | |||||||
Total debt | 643,915 | 576,689 | |||||||
Less: current maturities | 6,559 | 5,867 | |||||||
Long-term debt | $ | 637,356 | $ | 570,822 | |||||
Summary of future scheduled principal payments for term loan | ' | ||||||||
As of October 31, 2013, future scheduled principal payments on the term loan under the 2013 Amended Credit Agreement are presented in the following table: | |||||||||
(in thousands) | |||||||||
Years Ending January 31, | Amount | ||||||||
2014 (remainder of year) | $ | 1,625 | |||||||
2015 | 6,500 | ||||||||
2016 | 6,500 | ||||||||
2017 | 6,500 | ||||||||
2018 | 6,500 | ||||||||
2019 and thereafter | 619,125 | ||||||||
Total | $ | 646,750 | |||||||
SUPPLEMENTAL_CONDENSED_CONSOLI1
SUPPLEMENTAL CONDENSED CONSOLIDATED FINANCIAL STATEMENT INFORMATION (Tables) | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ||||||||||||||||
Schedule of Inventories | ' | ||||||||||||||||
Inventories consisted of the following as of October 31, 2013 and January 31, 2013: | |||||||||||||||||
October 31, | January 31, | ||||||||||||||||
(in thousands) | 2013 | 2013 | |||||||||||||||
Raw materials | $ | 3,837 | $ | 4,263 | |||||||||||||
Work-in-process | 6,039 | 5,633 | |||||||||||||||
Finished goods | 4,997 | 5,118 | |||||||||||||||
Total inventories | $ | 14,873 | $ | 15,014 | |||||||||||||
Schedule of Other Expense, Net | ' | ||||||||||||||||
Other expense, net consisted of the following for the three and nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Three Months Ended October 31, | Nine Months Ended October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Foreign currency (losses) gains, net | $ | 702 | $ | 1,144 | $ | (2,504 | ) | $ | 1,267 | ||||||||
Gains on derivative financial instruments, net | (721 | ) | (253 | ) | (45 | ) | (122 | ) | |||||||||
Other, net | (627 | ) | (1,231 | ) | (2,464 | ) | (1,334 | ) | |||||||||
Total other expense, net | $ | (646 | ) | $ | (340 | ) | $ | (5,013 | ) | $ | (189 | ) | |||||
Schedule of Supplemental Information Regarding Condensed Consolidated Statements of Cash Flows | ' | ||||||||||||||||
The following table provides supplemental information regarding our condensed consolidated cash flows for the nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
October 31, | |||||||||||||||||
(in thousands) | 2013 | 2012 | |||||||||||||||
Cash paid for interest | $ | 17,724 | $ | 20,546 | |||||||||||||
Cash (refunds) payments of income taxes, net | $ | (6,463 | ) | $ | 14,807 | ||||||||||||
Non-cash investing and financing transactions: | |||||||||||||||||
Net non-cash assets acquired in CTI Merger | $ | 3,727 | $ | — | |||||||||||||
Accrued but unpaid purchases of property and equipment | $ | 1,217 | $ | 1,715 | |||||||||||||
Inventory transfers to property and equipment | $ | 658 | $ | 374 | |||||||||||||
Liabilities for contingent consideration in business combinations | $ | 4,557 | $ | — | |||||||||||||
Leasehold improvements funded by lease incentive | $ | — | $ | 5,014 | |||||||||||||
STOCKHOLDERS_EQUITY_Tables
STOCKHOLDERS' EQUITY (Tables) | 9 Months Ended | ||||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||||
Stockholders' Equity Note [Abstract] | ' | ||||||||||||||||||
Schedule of accumulated other comprehensive loss | ' | ||||||||||||||||||
The following table summarizes changes in the components of our accumulated other comprehensive loss by component for the nine months ended October 31, 2013: | |||||||||||||||||||
(in thousands) | Unrealized Gains on Derivative Financial Instruments Designated as Hedges | Unrealized Gains on Available-for-Sale Investments | Foreign Currency Translation Adjustments | Total | |||||||||||||||
Accumulated other comprehensive income (loss) at January 31, 2013 | $ | 2,447 | $ | — | $ | (46,672 | ) | $ | (44,225 | ) | |||||||||
Other comprehensive income before reclassifications | 4,355 | 3 | 1,657 | 6,015 | |||||||||||||||
Amounts reclassified out of accumulated other comprehensive income (loss) | (4,041 | ) | — | — | (4,041 | ) | |||||||||||||
Net other comprehensive income (loss), current period | 314 | 3 | 1,657 | 1,974 | |||||||||||||||
Accumulated other comprehensive income (loss) at October 31, 2013 | $ | 2,761 | $ | 3 | $ | (45,015 | ) | $ | (42,251 | ) | |||||||||
Schedule of amounts reclassified out of AOCI into the statement of operations by location | ' | ||||||||||||||||||
The amounts reclassified out of accumulated other comprehensive loss into the condensed consolidated condensed statements of operations, with presentation location, for the three months ended October 31, 2013 and 2012 were as follows: | |||||||||||||||||||
Three Months Ended | Nine Months Ended | Affected Line Items in the Condensed Consolidated Statements of Operations | |||||||||||||||||
October 31, | October 31, | ||||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||||
Unrealized (gains) losses on derivative financial instruments: | |||||||||||||||||||
Foreign currency forward contracts | $ | (167 | ) | $ | 37 | $ | (370 | ) | $ | 114 | Cost of product revenue | ||||||||
(178 | ) | 43 | (383 | ) | 109 | Cost of service revenue | |||||||||||||
(1,123 | ) | 238 | (2,455 | ) | 646 | Research and development | |||||||||||||
(516 | ) | 122 | (1,140 | ) | 336 | Selling, general and administrative | |||||||||||||
(1,984 | ) | 440 | (4,348 | ) | 1,205 | Total, before provision for income taxes | |||||||||||||
(174 | ) | 44 | (307 | ) | 119 | (Provision for) benefit from income taxes | |||||||||||||
$ | (1,810 | ) | $ | 396 | $ | (4,041 | ) | $ | 1,086 | Total, net of income taxes | |||||||||
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended | ||||||||||||
Oct. 31, 2013 | |||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||
Schedule of assets and liabilities measured at fair value on recurring basis | ' | ||||||||||||
Our assets and liabilities measured at fair value on a recurring basis consisted of the following as of October 31, 2013 and January 31, 2013: | |||||||||||||
October 31, 2013 | |||||||||||||
Fair Value Hierarchy Category | |||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | ||||||||||
Assets: | |||||||||||||
Money market funds | $ | 45,538 | $ | — | $ | — | |||||||
Short-term investments, classified as available-for-sale | — | 113,592 | — | ||||||||||
Foreign currency forward contracts | — | 3,262 | — | ||||||||||
Total assets | $ | 45,538 | $ | 116,854 | $ | — | |||||||
Liabilities: | |||||||||||||
Foreign currency forward contracts | $ | — | $ | 1,040 | $ | — | |||||||
Contingent consideration - business combinations | — | — | 10,869 | ||||||||||
Total liabilities | $ | — | $ | 1,040 | $ | 10,869 | |||||||
31-Jan-13 | |||||||||||||
Fair Value Hierarchy Category | |||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | ||||||||||
Assets: | |||||||||||||
Money market funds | $ | 62,085 | $ | — | $ | — | |||||||
Commercial paper (1) | — | 4,000 | — | ||||||||||
Foreign currency forward contracts | — | 2,854 | — | ||||||||||
Total assets | $ | 62,085 | $ | 6,854 | $ | — | |||||||
Liabilities: | |||||||||||||
Foreign currency forward contracts | $ | — | $ | 542 | $ | — | |||||||
Contingent consideration - business combinations | — | — | 25,041 | ||||||||||
Total liabilities | $ | — | $ | 542 | $ | 25,041 | |||||||
Schedule of changes in the estimated fair value of liability for contingent consideration measured using significant unobservable inputs (Level 3) | ' | ||||||||||||
The following table presents the change in the estimated fair value of our liability for contingent consideration measured using significant unobservable inputs (Level 3) for the nine months ended October 31, 2013 and 2012: | |||||||||||||
Nine Months Ended | |||||||||||||
October 31, | |||||||||||||
(in thousands) | 2013 | 2012 | |||||||||||
Fair value measurement at beginning of period | $ | 25,041 | $ | 38,646 | |||||||||
Contingent consideration liabilities recorded for business combinations | 4,557 | — | |||||||||||
Changes in fair values, recorded in operating expenses | (1,635 | ) | (8,428 | ) | |||||||||
Payments of contingent consideration | (17,094 | ) | (6,902 | ) | |||||||||
Fair value measurement at end of period | $ | 10,869 | $ | 23,316 | |||||||||
DERIVATIVE_FINANCIAL_INSTRUMEN1
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended | ||||||||||||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||||||||||||
Schedule of fair values of derivative financial instruments | ' | ||||||||||||||||||||||||||
The fair values of our derivative financial instruments as of October 31, 2013 and January 31, 2013 were as follows: | |||||||||||||||||||||||||||
31-Oct-13 | |||||||||||||||||||||||||||
Assets | Liabilities | ||||||||||||||||||||||||||
(in thousands) | Balance Sheet | Fair Value | Balance Sheet | Fair Value | |||||||||||||||||||||||
Classification | Classification | ||||||||||||||||||||||||||
Derivative financial instruments designated as hedging instruments: | |||||||||||||||||||||||||||
Foreign currency forward contracts | Prepaid expenses and other current assets | $ | 3,262 | Accrued expenses and other liabilities | $ | 236 | |||||||||||||||||||||
Total derivative financial instruments designated as hedging instruments | $ | 3,262 | $ | 236 | |||||||||||||||||||||||
Derivative financial instruments not designated as hedging instruments: | |||||||||||||||||||||||||||
Foreign currency forward contracts | — | $ | — | Accrued expenses and other liabilities | $ | 804 | |||||||||||||||||||||
Total derivative financial instruments not designated as hedging instruments | $ | — | $ | 804 | |||||||||||||||||||||||
31-Jan-13 | |||||||||||||||||||||||||||
Assets | Liabilities | ||||||||||||||||||||||||||
(in thousands) | Balance Sheet | Fair Value | Balance Sheet | Fair Value | |||||||||||||||||||||||
Classification | Classification | ||||||||||||||||||||||||||
Derivative financial instruments designated as hedging instruments: | |||||||||||||||||||||||||||
Foreign currency forward contracts | Prepaid expenses and other current assets | $ | 2,808 | Accrued expenses and other liabilities | $ | 64 | |||||||||||||||||||||
Total derivative financial instruments designated as hedging instruments | $ | 2,808 | $ | 64 | |||||||||||||||||||||||
Derivative financial instruments not designated as hedging instruments: | |||||||||||||||||||||||||||
Foreign currency forward contracts | Prepaid expenses and other current assets | $ | 46 | Accrued expenses and other liabilities | $ | 478 | |||||||||||||||||||||
Total derivative financial instruments not designated as hedging instruments | $ | 46 | $ | 478 | |||||||||||||||||||||||
Schedule of the effects of derivative financial instruments designated as cash flow hedging instruments | ' | ||||||||||||||||||||||||||
The effects of derivative financial instruments designated as cash flow hedging instruments as of October 31, 2013 and January 31, 2013, and for the three and nine months ended October 31, 2013 and 2012 were as follows: | |||||||||||||||||||||||||||
Net Unrealized Gains Recognized in | Classification of Net Gains (Losses) Reclassified from Other Comprehensive Loss | Net Gains (Losses) Reclassified | |||||||||||||||||||||||||
Accumulated Other | into the Condensed Consolidated Statements of Operations | from Other Comprehensive Loss | |||||||||||||||||||||||||
Comprehensive Loss | into the Condensed Consolidated | ||||||||||||||||||||||||||
Statements of Operations | |||||||||||||||||||||||||||
October 31, | January 31, | Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
October 31, | October 31, | ||||||||||||||||||||||||||
(in thousands) | 2013 | 2013 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||
Foreign currency forward contracts | $ | 2,761 | $ | 2,447 | Operating Expenses | $ | 1,984 | $ | (440 | ) | $ | 4,348 | $ | (1,205 | ) | ||||||||||||
Schedule of losses recognized on derivative financial instruments not designated as hedging instruments | ' | ||||||||||||||||||||||||||
Losses recognized on derivative financial instruments not designated as hedging instruments in our condensed consolidated statements of operations for the three and nine months ended October 31, 2013 and 2012 were as follows: | |||||||||||||||||||||||||||
Classification in Condensed Consolidated Statements of Operations | Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
October 31, | October 31, | ||||||||||||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||
Foreign currency forward contracts | Other expense, net | $ | (721 | ) | $ | (254 | ) | $ | (44 | ) | $ | (123 | ) |
STOCKBASED_COMPENSATION_Tables
STOCK-BASED COMPENSATION (Tables) | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||||||
Schedule of recognized stock-based compensation expense in the consolidated statements of operations | ' | ||||||||||||||||
We recognized stock-based compensation expense in the following line items on the condensed consolidated statements of operations for the three and nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Cost of revenue - product | $ | 243 | $ | 257 | $ | 572 | $ | 583 | |||||||||
Cost of revenue - service and support | 458 | 564 | 1,208 | 1,531 | |||||||||||||
Research and development, net | 890 | 769 | 2,432 | 1,906 | |||||||||||||
Selling, general and administrative | 8,138 | 5,095 | 20,942 | 14,298 | |||||||||||||
Total stock-based compensation expense | $ | 9,729 | $ | 6,685 | $ | 25,154 | $ | 18,318 | |||||||||
Schedule of stock-based compensation expense by type of award | ' | ||||||||||||||||
The following table summarizes stock-based compensation expense by type of award for the three and nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Stock options | $ | 45 | $ | 59 | $ | 152 | $ | 236 | |||||||||
Restricted stock awards and restricted stock units | 8,335 | 4,605 | 21,727 | 15,050 | |||||||||||||
Phantom stock units | 23 | 28 | 87 | 517 | |||||||||||||
Stock bonus program | 1,326 | 1,993 | 3,188 | 2,515 | |||||||||||||
Total stock-based compensation expense | $ | 9,729 | $ | 6,685 | $ | 25,154 | $ | 18,318 | |||||||||
Schedule of total stock-based compensation expense by classification | ' | ||||||||||||||||
Total stock-based compensation expense by classification was as follows for the three and nine months ended October 31, 2013 and 2012: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Equity-classified awards | $ | 8,318 | $ | 4,550 | $ | 22,304 | $ | 15,022 | |||||||||
Stock bonus program | — | — | (298 | ) | 522 | ||||||||||||
Total equity-settled awards | 8,318 | 4,550 | 22,006 | 15,544 | |||||||||||||
Other liability-classified awards | 1,411 | 2,135 | 3,148 | 2,774 | |||||||||||||
Total stock-based compensation expense | $ | 9,729 | $ | 6,685 | $ | 25,154 | $ | 18,318 | |||||||||
Schedule of stock option activity and related information | ' | ||||||||||||||||
The following table summarizes stock option activity and related information for the nine months ended October 31, 2013: | |||||||||||||||||
(in thousands, except per share data) | Number of Stock Options | Weighted-Average Exercise Price | |||||||||||||||
Outstanding at January 31, 2013 | 924 | $ | 31.88 | ||||||||||||||
Options exercised | (246 | ) | $ | 26.2 | |||||||||||||
Options forfeited or expired | (15 | ) | $ | 24.88 | |||||||||||||
Outstanding at October 31, 2013 | 663 | $ | 34.14 | ||||||||||||||
Options exercisable at October 31, 2013 | 658 | $ | 34.35 | ||||||||||||||
Schedule of restricted stock unit activity and related information | ' | ||||||||||||||||
The following table summarizes restricted stock unit activity and related information for the nine months ended October 31, 2013: | |||||||||||||||||
(in thousands, except per share data) | Number of RSUs | Weighted-Average Grant Date Fair Value | |||||||||||||||
Outstanding at January 31, 2013 | 1,536 | $ | 31.42 | ||||||||||||||
RSUs granted | 1,537 | $ | 33.16 | ||||||||||||||
RSUs released | (776 | ) | $ | 31.67 | |||||||||||||
RSUs forfeited | (78 | ) | $ | 31.79 | |||||||||||||
Outstanding at October 31, 2013 | 2,219 | $ | 32.51 | ||||||||||||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended | ||||||||
Oct. 31, 2013 | |||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||||
Schedule of Product Warranty Liability | ' | ||||||||
The following table summarizes the activity in our warranty liability, which is included in accrued expenses and other liabilities in the condensed consolidated balance sheets, for the nine months ended October 31, 2013 and 2012: | |||||||||
Nine Months Ended | |||||||||
October 31, | |||||||||
(in thousands) | 2013 | 2012 | |||||||
Warranty liability, beginning of period | $ | 1,045 | $ | 2,015 | |||||
Provisions credited to expenses | (253 | ) | (701 | ) | |||||
Warranty charges | — | (188 | ) | ||||||
Foreign currency translation and other | (2 | ) | (8 | ) | |||||
Warranty liability, end of period | $ | 790 | $ | 1,118 | |||||
SEGMENT_INFORMATION_Tables
SEGMENT INFORMATION (Tables) | 9 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
Operating results by segment | ' | ||||||||||||||||
Operating results by segment for the three and nine months ended October 31, 2013 and 2012 were as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
October 31, | October 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Revenue: | |||||||||||||||||
Enterprise Intelligence | |||||||||||||||||
Segment revenue | $ | 126,220 | $ | 122,245 | $ | 365,385 | $ | 351,659 | |||||||||
Revenue adjustments | (323 | ) | (443 | ) | (692 | ) | (3,655 | ) | |||||||||
125,897 | 121,802 | 364,693 | 348,004 | ||||||||||||||
Video Intelligence | |||||||||||||||||
Segment revenue | 27,287 | 25,587 | 88,388 | 93,916 | |||||||||||||
Revenue adjustments | — | (348 | ) | (167 | ) | (1,840 | ) | ||||||||||
27,287 | 25,239 | 88,221 | 92,076 | ||||||||||||||
Communications Intelligence | |||||||||||||||||
Segment revenue | 71,249 | 54,817 | 199,163 | 172,381 | |||||||||||||
Revenue adjustments | (119 | ) | (338 | ) | (530 | ) | (1,880 | ) | |||||||||
71,130 | 54,479 | 198,633 | 170,501 | ||||||||||||||
Total revenue | $ | 224,314 | $ | 201,520 | $ | 651,547 | $ | 610,581 | |||||||||
Segment contribution: | |||||||||||||||||
Enterprise Intelligence | $ | 56,772 | $ | 52,139 | $ | 155,169 | $ | 147,102 | |||||||||
Video Intelligence | 5,546 | 3,992 | 20,482 | 23,027 | |||||||||||||
Communications Intelligence | 24,457 | 18,693 | 62,223 | 49,826 | |||||||||||||
Total segment contribution | 86,775 | 74,824 | 237,874 | 219,955 | |||||||||||||
Unallocated expenses, net: | |||||||||||||||||
Amortization of acquired intangible assets | 8,085 | 9,805 | 26,113 | 29,466 | |||||||||||||
Stock-based compensation | 9,729 | 6,685 | 25,154 | 18,318 | |||||||||||||
Other unallocated expenses | 31,130 | 41,563 | 103,800 | 108,154 | |||||||||||||
Total unallocated expenses, net | 48,944 | 58,053 | 155,067 | 155,938 | |||||||||||||
Operating income | 37,831 | 16,771 | 82,807 | 64,017 | |||||||||||||
Other expense, net | (7,820 | ) | (7,913 | ) | (36,316 | ) | (23,093 | ) | |||||||||
Income before provision for income taxes | $ | 30,011 | $ | 8,858 | $ | 46,491 | $ | 40,924 | |||||||||
BASIS_OF_PRESENTATION_AND_SIGN2
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Details) | 9 Months Ended |
Oct. 31, 2013 | |
Less than | ' |
Basis of Presentation | ' |
Maximum ownership interest in cost method investments (as a percent) | 20.00% |
Joint venture, variable interest entity in which entity is primary beneficiary | ' |
Basis of Presentation | ' |
Equity interest in a joint venture (as a percent) | 50.00% |
NET_INCOME_PER_COMMON_SHARE_AT2
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC. - CALCULATION (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 |
Earnings Per Share [Abstract] | ' | ' | ' | ' |
Net income | $24,054 | $6,615 | $34,622 | $31,510 |
Net income attributable to noncontrolling interest | 1,567 | 1,144 | 3,752 | 3,397 |
Net income attributable to Verint Systems Inc. | 22,487 | 5,471 | 30,870 | 28,113 |
Dividends on Preferred Stock | 0 | -3,909 | -174 | -11,521 |
Net income attributable to Verint Systems Inc. for basic net income per common share | 22,487 | 1,562 | 30,696 | 16,592 |
Dilutive effect of dividends on Preferred Stock | 0 | 0 | 0 | 0 |
Net income attributable to Verint Systems Inc. for diluted net income per common share | $22,487 | $1,562 | $30,696 | $16,592 |
Reconciliation of Weighted Average Number of Shares Outstanding | ' | ' | ' | ' |
Basic (in shares) | 53,374,000 | 39,785,000 | 52,781,000 | 39,622,000 |
Dilutive effect of employee equity award plans (in shares) | 572,000 | 137,000 | 780,000 | 472,000 |
Dilutive effect of assumed conversion of Preferred Stock (in shares) | 0 | 0 | 0 | 0 |
Diluted (in shares) | 53,946,000 | 39,922,000 | 53,561,000 | 40,094,000 |
Net Income Per Common Share Attributable to Verint Systems Inc.: | ' | ' | ' | ' |
Basic (in dollars per share) | $0.42 | $0.04 | $0.58 | $0.42 |
Diluted (in dollars per share) | $0.42 | $0.04 | $0.57 | $0.41 |
NET_INCOME_PER_COMMON_SHARE_AT3
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC. NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC. - ANTIDILUTIVE SECURITIES (Details) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 |
Stock options and restricted stock-based awards | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ' | ' | ' |
Anti-dilutive securities (in shares) | 343 | 1,348 | 263 | 888 |
Convertible Preferred Stock | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ' | ' | ' |
Anti-dilutive securities (in shares) | 0 | 11,095 | 164 | 10,989 |
CASH_CASH_EQUIVALENTS_AND_SHOR2
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS (Details) (USD $) | Oct. 31, 2013 | Jan. 31, 2013 |
In Thousands, unless otherwise specified | ||
Commercial paper and corporate debt securities (available-for-sale) | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Cost Basis | $113,589 | ' |
Gross Unrealized Gains | 3 | ' |
Gross Unrealized Losses | 0 | ' |
Estimated Fair Value | 113,592 | ' |
Bank time deposits | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Cost Basis | 25,259 | 13,593 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 25,259 | 13,593 |
Total short-term investments | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Cost Basis | 138,848 | 13,593 |
Gross Unrealized Gains | 3 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 138,851 | 13,593 |
Cash and bank time deposits | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Cost Basis | 191,922 | 143,888 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 191,922 | 143,888 |
Money market funds | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Cost Basis | 45,538 | 62,085 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 45,538 | 62,085 |
Commercial paper | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Cost Basis | ' | 4,000 |
Gross Unrealized Gains | ' | 0 |
Gross Unrealized Losses | ' | 0 |
Estimated Fair Value | ' | 4,000 |
Total cash and cash equivalents | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Cost Basis | 237,460 | 209,973 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | $237,460 | $209,973 |
CASH_CASH_EQUIVALENTS_AND_SHOR3
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS - OTHER DISCLOSURES (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Proceeds from sale and maturity of available-for-sale securities | $70,000 | $0 |
MERGER_WITH_CTI_MERGER_WITH_CT
MERGER WITH CTI MERGER WITH CTI - EXCHANGE OF SHARES (Details) (USD $) | Oct. 31, 2013 | Jan. 31, 2013 | Feb. 04, 2013 | Feb. 04, 2013 | Feb. 04, 2013 | Feb. 04, 2013 | Feb. 04, 2013 | Feb. 04, 2013 |
CTI Merger | Common Shares Issued in Exchange for Common Shares Held by Majority Owner [Member] | Common Shares Issued in Exchange for Preferred Stock Held by Majority Owner [Member] | Common Shares Issued for Target Amount to Majority Owner [Member] | Common Shares Issued for Positive Net Worth of Majority Owner [Member] | Maximum | |||
CTI Merger | CTI Merger | CTI Merger | CTI Merger | CTI Merger | ||||
Business Acquisition | ' | ' | ' | ' | ' | ' | ' | ' |
Exchange Ratio for Shares of Common Stock Exchanged in Merger | ' | ' | $0.13 | ' | ' | ' | ' | ' |
Common Shares Issued in Merger Transaction | ' | ' | 28,600,000 | 16,300,000 | 11,200,000 | 800,000 | 300,000 | ' |
Common stock, outstanding (in shares) | 53,454,000 | 40,158,000 | 220,000,000 | ' | ' | ' | ' | ' |
Shares of Common Stock Held by Majority Shareholder | ' | ' | 16,300,000 | ' | ' | ' | ' | ' |
Incremental Common Shares Issued in Connection with Merger Transaction | ' | ' | 12,300,000 | ' | ' | ' | ' | ' |
Series A convertible preferred stock, aggregate liquidation preference value (in dollars) | 0 | 365,914,000 | 366,100,000 | ' | ' | ' | ' | ' |
Business Combination, Contingent Consideration, Share Exchange, Shares Conversion Price | ' | ' | $32.66 | ' | ' | ' | ' | ' |
Business Combination, Contingent Consideration, Share Exchange, Value of Shares Target Amount | ' | ' | 25,000,000 | ' | ' | ' | ' | ' |
Average Daily Weighted Average Price | ' | ' | $32.78 | ' | ' | ' | ' | ' |
Business Combination, Contingent Consideration, Share Exchange, Value of Shares Based on Net Worth of Acquiree, Maximum | ' | ' | $9,900,000 | ' | ' | ' | ' | $10,000,000 |
MERGER_WITH_CTI_MERGER_WITH_CT1
MERGER WITH CTI MERGER WITH CTI - CONDENSED CONSOLIDATED FINANCIAL STATEMENT IMPACT (Details) (USD $) | Oct. 31, 2013 | Jan. 31, 2013 | Feb. 04, 2013 | Feb. 04, 2013 |
Series A Preferred Stock [Member] | CTI Merger | |||
Business Acquisition | ' | ' | ' | ' |
Temporary Equity, Carrying Amount | $0 | $285,542,000 | $285,500,000 | ' |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | ' | ' | ' | 14,100,000 |
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued, CTI Merger | ' | ' | ' | 15,800,000 |
Business Combination, Indemnification Assets, Amount as of Acquisition Date | ' | ' | ' | $15,800,000 |
MERGER_WITH_CTI_MERGER_WITH_CT2
MERGER WITH CTI MERGER WITH CTI - OTHER DISCLOSURES (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
In Millions, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Jan. 31, 2013 | Feb. 04, 2013 |
Merger with CTI | ' | ' | ' | ' | ' | ' |
Beneficial ownership position held by parent (as a percent) | ' | ' | ' | ' | 53.50% | ' |
CTI Merger | ' | ' | ' | ' | ' | ' |
Merger with CTI | ' | ' | ' | ' | ' | ' |
Business combination, acquisition related costs | $0.10 | $9.60 | $0.60 | $12.90 | $16.10 | ' |
Indemnification obligations | ' | ' | ' | ' | ' | 25 |
Amount in escrow account to support indemnification claims | ' | ' | ' | ' | ' | $25 |
BUSINESS_COMBINATIONS_BUSINESS2
BUSINESS COMBINATIONS BUSINESS COMBINATIONS (Details - Business Combinations - Current Period) (USD $) | 3 Months Ended | 9 Months Ended | |||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Jan. 31, 2012 | |
Business Acquisition | ' | ' | ' | ' | ' |
Business Acquisition, Contingent Consideration, at Fair Value | $4,557,000 | $0 | $4,557,000 | $0 | ' |
Series of Individually Immaterial Business Acquisitions | ' | ' | ' | ' | ' |
Business Acquisition | ' | ' | ' | ' | ' |
Business Acquisition, Cost of Acquired Entity, Purchase Price | 15,410,000 | ' | 15,410,000 | ' | 55,200,000 |
Business Acquisition, Cost of Acquired Entity, Cash Paid | 10,853,000 | ' | 10,853,000 | ' | ' |
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High | 5,400,000 | ' | 5,400,000 | ' | 41,000,000 |
Business Acquisition, Contingent Consideration, at Fair Value | 4,557,000 | ' | 4,557,000 | ' | 20,500,000 |
Business Acquisition, Purchase Price Allocation, Goodwill Amount | 7,767,000 | ' | 7,767,000 | ' | ' |
Business Acquisition, Cost of Acquired Entity, Transaction Costs During Period | 600,000 | 100,000 | 1,100,000 | 600,000 | ' |
Enterprise Intelligence | Series of Individually Immaterial Business Acquisitions | ' | ' | ' | ' | ' |
Business Acquisition | ' | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Goodwill, Tax Not Deductible Amount | 7,100,000 | ' | 7,100,000 | ' | ' |
Communications Intelligence | Series of Individually Immaterial Business Acquisitions | ' | ' | ' | ' | ' |
Business Acquisition | ' | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Goodwill, Expected Tax Deductible Amount | $700,000 | ' | $700,000 | ' | ' |
BUSINESS_COMBINATIONS_BUSINESS3
BUSINESS COMBINATIONS BUSINESS COMBINATIONS (Details - Purchase Price Allocation - Current Period Business Combinations) (USD $) | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Jan. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2013 | Oct. 31, 2013 |
In Thousands, unless otherwise specified | Series of Individually Immaterial Business Acquisitions | Series of Individually Immaterial Business Acquisitions | Customer relationships | Acquired technology | Trademarks and trade names | ||
Series of Individually Immaterial Business Acquisitions | Series of Individually Immaterial Business Acquisitions | Series of Individually Immaterial Business Acquisitions | |||||
Business Acquisition | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Cost of Acquired Entity, Cash Paid | ' | ' | $10,853 | ' | ' | ' | ' |
Business Acquisition, Contingent Consideration, at Fair Value | 4,557 | 0 | 4,557 | 20,500 | ' | ' | ' |
Business Acquisition, Cost of Acquired Entity, Purchase Price | ' | ' | 15,410 | 55,200 | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Current Assets, Receivables | ' | ' | 1,545 | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Current Assets, Prepaid Expense and Other Assets | ' | ' | 1,468 | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Noncurrent Assets | ' | ' | 245 | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Current Liabilities, Other Liabilities | ' | ' | -1,118 | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Current Liabilities, Deferred Revenue | ' | ' | -760 | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Deferred Taxes Asset (Liability), Net, Noncurrent | ' | ' | -2,164 | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Assets Acquired (Liabilities Assumed), Net | ' | ' | -784 | ' | ' | ' | ' |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangibles | ' | ' | ' | ' | 6,809 | 1,209 | 409 |
Acquired Finite-lived Intangible Asset, Amount | ' | ' | 8,427 | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Goodwill Amount | ' | ' | $7,767 | ' | ' | ' | ' |
BUSINESS_COMBINATIONS_BUSINESS4
BUSINESS COMBINATIONS BUSINESS COMBINATIONS (Details - Useful Lives - Acquired Finite-Lived Intangible Assets) (Details) (Series of Individually Immaterial Business Acquisitions) | 3 Months Ended |
Oct. 31, 2013 | |
Business Acquisition | ' |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | '8 years 1 month |
Trademarks and trade names | ' |
Business Acquisition | ' |
Finite-Lived Intangible Asset, Useful Life | '2 years |
Customer relationships | ' |
Business Acquisition | ' |
Finite-Lived Intangible Asset, Useful Life | '9 years |
Minimum | Acquired technology | ' |
Business Acquisition | ' |
Finite-Lived Intangible Asset, Useful Life | '3 years |
Maximum | Acquired technology | ' |
Business Acquisition | ' |
Finite-Lived Intangible Asset, Useful Life | '5 years |
BUSINESS_COMBINATIONS_BUSINESS5
BUSINESS COMBINATIONS BUSINESS COMBINATIONS (Details - Vovici) (USD $) | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2012 | Oct. 31, 2012 | Jan. 31, 2013 | Aug. 04, 2011 |
Enterprise Intelligence | Enterprise Intelligence | Enterprise Intelligence | Enterprise Intelligence | |||
Vovici Corporation | Vovici Corporation | Vovici Corporation | Vovici Corporation | |||
Business Acquisition | ' | ' | ' | ' | ' | ' |
Business Acquisition, Cost of Acquired Entity, Purchase Price | ' | ' | ' | ' | ' | $66,100,000 |
Business Acquisition, Contingent Consideration, at Fair Value | 4,557,000 | 0 | ' | ' | 6,400,000 | 9,900,000 |
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High | ' | ' | ' | ' | ' | 19,100,000 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings | ' | ' | 800,000 | -2,900,000 | ' | ' |
Business Acquisition, Cost of Acquired Entity, Transaction Costs During Period | ' | ' | $300,000 | $500,000 | ' | ' |
BUSINESS_COMBINATIONS_BUSINESS6
BUSINESS COMBINATIONS BUSINESS COMBINATIONS (Details - GMT) (USD $) | 3 Months Ended | 9 Months Ended | |||||
Oct. 31, 2013 | Jul. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Jan. 31, 2013 | Oct. 07, 2011 | |
Business Acquisition | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Contingent Consideration, at Fair Value | $4,557,000 | ' | $0 | $4,557,000 | $0 | ' | ' |
Enterprise Intelligence | Global Management Technologies | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Cost of Acquired Entity, Purchase Price | ' | ' | ' | ' | ' | ' | 36,600,000 |
Business Acquisition, Contingent Consideration, at Fair Value | ' | ' | ' | ' | ' | 2,800,000 | 12,000,000 |
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High | ' | ' | ' | ' | ' | ' | 17,400,000 |
Loss consideration, settlement agreement, consideration amount | ' | 2,700,000 | ' | ' | ' | ' | ' |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings | -800,000 | ' | -1,300,000 | -100,000 | -5,800,000 | ' | ' |
Business Acquisition, Cost of Acquired Entity, Transaction Costs During Period | ' | ' | $100,000 | ' | $300,000 | ' | ' |
BUSINESS_COMBINATIONS_BUSINESS7
BUSINESS COMBINATIONS BUSINESS COMBINATIONS (Details - Other Business Combinations in Prior Periods) (USD $) | 3 Months Ended | 9 Months Ended | |||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Jan. 31, 2012 | |
Business Acquisition | ' | ' | ' | ' | ' |
Business Acquisition, Contingent Consideration, at Fair Value | $4,557,000 | $0 | $4,557,000 | $0 | ' |
Business Combination, Contingent Consideration Arrangements, Payment of Contingent Consideration | ' | ' | 16,087,000 | 6,074,000 | ' |
Series of Individually Immaterial Business Acquisitions | ' | ' | ' | ' | ' |
Business Acquisition | ' | ' | ' | ' | ' |
Business Acquisition, Cost of Acquired Entity, Purchase Price | 15,410,000 | ' | 15,410,000 | ' | 55,200,000 |
Business Acquisition, Contingent Consideration, at Fair Value | 4,557,000 | ' | 4,557,000 | ' | 20,500,000 |
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High | 5,400,000 | ' | 5,400,000 | ' | 41,000,000 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings | -1,000,000 | ' | -1,600,000 | ' | ' |
Fair Value, Measurement with Unobservable Inputs Reconciliations, Recurring Basis, Liability Value | 6,400,000 | ' | 6,400,000 | ' | ' |
Business Combination, Contingent Consideration Arrangements, Payment of Contingent Consideration | ' | ' | 7,800,000 | 5,200,000 | ' |
Business Acquisition, Cost of Acquired Entity, Transaction Costs During Period | $600,000 | $100,000 | $1,100,000 | $600,000 | ' |
BUSINESS_COMBINATIONS_BUSINESS8
BUSINESS COMBINATIONS BUSINESS COMBINATIONS (Details - Preacquisition Contingencies) (Communications Intelligence, Series of Individually Immaterial Business Acquisitions, USD $) | 3 Months Ended | |||
In Millions, unless otherwise specified | Oct. 31, 2013 | Apr. 30, 2013 | Jan. 31, 2013 | Aug. 02, 2011 |
Communications Intelligence | Series of Individually Immaterial Business Acquisitions | ' | ' | ' | ' |
Business Acquisition | ' | ' | ' | ' |
Business Acquisition, Current Liabilities, Preacquisition Contingency Accrual | $2.20 | ' | $3 | $4.70 |
Business Acquisition, Noncurrent Liabilities, Preacquisition Contingency Accrual | 2.2 | ' | 3 | 5.2 |
Business Combinations, Indemnification Assets, Current Portion | ' | ' | 3 | 4.7 |
Business Combinations, Indemnification Assets, Long-term Portion | 1.2 | ' | 2.6 | 5.2 |
Indemnification Asset Impairment Charge | $0.40 | $0.30 | ' | ' |
INTANGIBLE_ASSETS_AND_GOODWILL2
INTANGIBLE ASSETS AND GOODWILL - INTANGIBLE ASSETS (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Jan. 31, 2013 |
Acquisition-related intangible assets | ' | ' | ' | ' | ' |
Intangible assets with finite lives, cost | $349,901 | ' | $349,901 | ' | $340,717 |
Intangible assets with finite lives, accumulated amortization | -225,515 | ' | -225,515 | ' | -198,956 |
Intangible assets with finite lives, net | 124,386 | ' | 124,386 | ' | 141,761 |
Total intangible assets, cost | 351,601 | ' | 351,601 | ' | 343,217 |
Total intangible assets, net | 126,086 | ' | 126,086 | ' | 144,261 |
Total amortization expense for acquisition-related intangible assets | 8,100 | 9,800 | 26,100 | 29,500 | ' |
Enterprise Intelligence | ' | ' | ' | ' | ' |
Acquisition-related intangible assets | ' | ' | ' | ' | ' |
Total intangible assets, net | 111,291 | ' | 111,291 | ' | 126,341 |
Video Intelligence | ' | ' | ' | ' | ' |
Acquisition-related intangible assets | ' | ' | ' | ' | ' |
Total intangible assets, net | 3,002 | ' | 3,002 | ' | 3,880 |
Communications Intelligence | ' | ' | ' | ' | ' |
Acquisition-related intangible assets | ' | ' | ' | ' | ' |
Total intangible assets, net | 11,793 | ' | 11,793 | ' | 14,040 |
In-process research and development, with indefinite lives | ' | ' | ' | ' | ' |
Acquisition-related intangible assets | ' | ' | ' | ' | ' |
Intangible assets with indefinite lives, cost | 1,700 | ' | 1,700 | ' | 2,500 |
Customer relationships | ' | ' | ' | ' | ' |
Acquisition-related intangible assets | ' | ' | ' | ' | ' |
Intangible assets with finite lives, cost | 232,256 | ' | 232,256 | ' | 225,321 |
Intangible assets with finite lives, accumulated amortization | -135,140 | ' | -135,140 | ' | -117,903 |
Intangible assets with finite lives, net | 97,116 | ' | 97,116 | ' | 107,418 |
Acquired technology | ' | ' | ' | ' | ' |
Acquisition-related intangible assets | ' | ' | ' | ' | ' |
Intangible assets with finite lives, cost | 95,733 | ' | 95,733 | ' | 93,860 |
Intangible assets with finite lives, accumulated amortization | -72,612 | ' | -72,612 | ' | -64,617 |
Intangible assets with finite lives, net | 23,121 | ' | 23,121 | ' | 29,243 |
Trade names | ' | ' | ' | ' | ' |
Acquisition-related intangible assets | ' | ' | ' | ' | ' |
Intangible assets with finite lives, cost | 13,113 | ' | 13,113 | ' | 12,737 |
Intangible assets with finite lives, accumulated amortization | -11,085 | ' | -11,085 | ' | -10,537 |
Intangible assets with finite lives, net | 2,028 | ' | 2,028 | ' | 2,200 |
Non-competition agreements | ' | ' | ' | ' | ' |
Acquisition-related intangible assets | ' | ' | ' | ' | ' |
Intangible assets with finite lives, cost | 5,516 | ' | 5,516 | ' | 5,516 |
Intangible assets with finite lives, accumulated amortization | -4,785 | ' | -4,785 | ' | -4,227 |
Intangible assets with finite lives, net | 731 | ' | 731 | ' | 1,289 |
Distribution network | ' | ' | ' | ' | ' |
Acquisition-related intangible assets | ' | ' | ' | ' | ' |
Intangible assets with finite lives, cost | 2,440 | ' | 2,440 | ' | 2,440 |
Intangible assets with finite lives, accumulated amortization | -1,779 | ' | -1,779 | ' | -1,596 |
Intangible assets with finite lives, net | 661 | ' | 661 | ' | 844 |
Backlog | ' | ' | ' | ' | ' |
Acquisition-related intangible assets | ' | ' | ' | ' | ' |
Intangible assets with finite lives, cost | 843 | ' | 843 | ' | 843 |
Intangible assets with finite lives, accumulated amortization | -114 | ' | -114 | ' | -76 |
Intangible assets with finite lives, net | $729 | ' | $729 | ' | $767 |
INTANGIBLE_ASSETS_AND_GOODWILL3
INTANGIBLE ASSETS AND GOODWILL INTANGIBLE ASSETS AND GOODWILL - FUTURE AMORTIZATION - INTANGIBLE ASSETS (Details) (USD $) | Oct. 31, 2013 | Jan. 31, 2013 |
In Thousands, unless otherwise specified | ||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ' | ' |
2014 (remainder of year) | $8,544 | ' |
2015 | 32,491 | ' |
2016 | 30,806 | ' |
2017 | 27,873 | ' |
2018 | 11,575 | ' |
2019 and thereafter | 13,097 | ' |
Intangible assets with finite lives, net | $124,386 | $141,761 |
INTANGIBLE_ASSETS_AND_GOODWILL4
INTANGIBLE ASSETS AND GOODWILL - GOODWILL (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Oct. 31, 2013 | Jan. 31, 2013 |
Goodwill activity | ' | ' |
Goodwill, gross | $905,587 | $896,774 |
Accumulated impairment losses | -66,865 | -66,865 |
Goodwill, net at the beginning of the period | 829,909 | ' |
Business combinations | 7,767 | ' |
Foreign currency translation and other | 1,046 | ' |
Goodwill, net, at the end of the period | 838,722 | ' |
Enterprise Intelligence | ' | ' |
Goodwill activity | ' | ' |
Goodwill, gross | 780,430 | 771,738 |
Accumulated impairment losses | -30,791 | -30,791 |
Goodwill, net at the beginning of the period | 740,947 | ' |
Business combinations | 7,055 | ' |
Foreign currency translation and other | 1,637 | ' |
Goodwill, net, at the end of the period | 749,639 | ' |
Video Intelligence | ' | ' |
Goodwill activity | ' | ' |
Goodwill, gross | 76,809 | 76,803 |
Accumulated impairment losses | -36,074 | -36,074 |
Goodwill, net at the beginning of the period | 40,729 | ' |
Business combinations | 0 | ' |
Foreign currency translation and other | 6 | ' |
Goodwill, net, at the end of the period | 40,735 | ' |
Communications Intelligence | ' | ' |
Goodwill activity | ' | ' |
Goodwill, gross | 48,348 | 48,233 |
Accumulated impairment losses | 0 | 0 |
Goodwill, net at the beginning of the period | 48,233 | ' |
Business combinations | 712 | ' |
Foreign currency translation and other | -597 | ' |
Goodwill, net, at the end of the period | $48,348 | ' |
LONGTERM_DEBT_LONGTERM_DEBT_SU
LONG-TERM DEBT LONG-TERM DEBT - SUMMARY OF DEBT (Details) (USD $) | Oct. 31, 2013 | Mar. 06, 2013 | Jan. 31, 2013 | Apr. 30, 2011 |
In Thousands, unless otherwise specified | ||||
Debt Instrument | ' | ' | ' | ' |
Long-term debt including current maturities | $643,915 | ' | $576,689 | ' |
Current maturities of long-term debt | 6,559 | ' | 5,867 | ' |
Long-term debt | 637,356 | ' | 570,822 | ' |
Other long-term debt | ' | ' | ' | ' |
Debt Instrument | ' | ' | ' | ' |
Long-term debt including current maturities | 109 | ' | 2,888 | ' |
2013 Amended Credit Agreement | Term loan | ' | ' | ' | ' |
Debt Instrument | ' | ' | ' | ' |
Long-term debt, gross | 646,750 | ' | 0 | ' |
Unamortized debt discount | 2,944 | 3,300 | 0 | ' |
2011 Credit Agreement | Term loan | ' | ' | ' | ' |
Debt Instrument | ' | ' | ' | ' |
Long-term debt, gross | 0 | ' | 576,000 | ' |
Unamortized debt discount | $0 | $2,200 | $2,199 | $3,000 |
LONGTERM_DEBT_LONGTERM_DEBT_CR
LONG-TERM DEBT LONG-TERM DEBT - CREDIT AGREEMENTS (Details) (USD $) | 31-May-07 | Apr. 30, 2011 | 31-May-07 | 31-May-07 | Jul. 31, 2010 | Mar. 31, 2013 | Oct. 31, 2013 | Mar. 06, 2013 | Jan. 31, 2013 | Mar. 06, 2013 | Mar. 06, 2013 | Mar. 31, 2013 | Apr. 30, 2011 | Oct. 31, 2013 | Mar. 06, 2013 | Jan. 31, 2013 | Apr. 30, 2011 | Apr. 30, 2011 | Mar. 31, 2013 | Mar. 31, 2013 |
2007 Credit Agreement | 2007 Credit Agreement | 2007 Credit Agreement | 2007 Credit Agreement | 2007 Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | Line of Credit Facility Covenant Period Until July 2015 | Line of Credit Facility Covenant Period July 2015 Thereafter | |
Term loan | Term loan | Line of credit | Line of credit | Term loan | Term loan | Term loan | Term loan | Line of credit | Credit Agreement | Term loan | Term loan | Term loan | Term loan | Term loan | Line of credit | Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | ||
numerator | numerator | |||||||||||||||||||
Debt Instrument | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Maximum Borrowing Capacity | $675,000,000 | ' | $650,000,000 | $25,000,000 | $75,000,000 | ' | ' | $650,000,000 | ' | $200,000,000 | $850,000,000 | ' | $600,000,000 | ' | ' | ' | $170,000,000 | $770,000,000 | ' | ' |
Debt Instrument Term (in years) | ' | ' | '7 years | '6 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Current Borrowing Capacity | ' | ' | ' | ' | ' | ' | ' | ' | ' | 300,000,000 | ' | ' | ' | ' | ' | ' | 300,000,000 | ' | ' | ' |
Debt Instrument Discount Rate Percentage | ' | ' | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' | ' | ' |
Unamortized debt discount | ' | ' | ' | ' | ' | ' | 2,944,000 | 3,300,000 | 0 | ' | ' | ' | 3,000,000 | 0 | 2,200,000 | 2,199,000 | ' | ' | ' | ' |
Proceeds from Issuance of Debt | ' | ' | ' | ' | ' | 646,700,000 | ' | ' | ' | ' | ' | ' | 597,000,000 | ' | ' | ' | ' | ' | ' | ' |
Repayments of debt | ' | $583,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $576,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Consolidated Total Debt to Consolidated EBITDA Ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5 | 4.5 |
LONGTERM_DEBT_LONGTERM_DEBT_IN
LONG-TERM DEBT LONG-TERM DEBT - INTEREST RATE DETAILS (Details) | 1 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Mar. 31, 2013 | Oct. 31, 2013 | Jan. 31, 2013 | Oct. 31, 2013 | Apr. 30, 2011 | Oct. 31, 2013 | Oct. 31, 2013 | Jan. 31, 2013 | Jan. 31, 2013 | Jan. 31, 2013 | Oct. 31, 2013 | Jan. 31, 2013 | Oct. 31, 2013 | Jan. 31, 2013 | Oct. 31, 2013 | Jan. 31, 2013 | Oct. 31, 2013 | Jan. 31, 2013 | |
2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2011 Credit Agreement | Debt Instrument Variable Rate Base Adjusted LIBO | Debt Instrument Variable Rate Base Adjusted LIBO | Debt Instrument Variable Rate Base Adjusted LIBO | Debt Instrument Variable Rate Base Adjusted LIBO | Debt Instrument Variable Rate Base Adjusted LIBO | Debt Instrument Variable Rate Base | Debt Instrument Variable Rate Base | Debt Instrument Variable Rate Base Federal Funds | Debt Instrument Variable Rate Base Federal Funds | Corporate Credit Quality Indicator | Corporate Credit Quality Indicator | Corporate Credit Quality Indicator | Corporate Credit Quality Indicator | |
Term loan | Term loan | Term loan | Eurodollar Loans | Term loan | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | 2013 Amended Credit Agreement | 2011 Credit Agreement | 2013 Amended Credit Agreement | 2011 Credit Agreement | 2013 Amended Credit Agreement | 2011 Credit Agreement | Debt Instrument Variable Rate Base Adjusted LIBO | Debt Instrument Variable Rate Base Adjusted LIBO | |
Eurodollar Loans | Base Rate Loans | Eurodollar Loans | Base Rate Loans | Base Rate Loans | Base Rate Loans | Base Rate Loans | Base Rate Loans | Base Rate Loans | Base Rate Loans | 2013 Amended Credit Agreement | 2011 Credit Agreement | |||||||
Eurodollar Loans | Eurodollar Loans | |||||||||||||||||
Debt Instrument | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument Interest Period (in months) | ' | ' | ' | '3 months | ' | ' | '1 month | '1 month | ' | '1 month | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument Discount Rate Percentage | 0.50% | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Interest Rate, Effective Percentage | ' | 4.23% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Description of Variable Rate Basis | ' | ' | ' | ' | ' | 'Adjusted LIBO Rate | ' | ' | 'Adjusted LIBO Rate | ' | 'Base Rate | 'Base Rate | 'Federal Funds Effective Rate | 'Federal Funds Effective Rate | ' | ' | ' | ' |
Debt Instrument, Basis Spread on Variable Rate | ' | ' | ' | ' | ' | 3.00% | 1.00% | ' | 3.25% | 1.00% | 2.00% | 2.25% | 0.50% | 0.50% | 1.75% | 2.00% | 2.75% | 3.00% |
Debt Instrument, Interest Rate at Period End | ' | 4.00% | 4.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument Rate Used to Calculate Reference Rate | ' | ' | ' | ' | ' | 1.00% | ' | ' | 1.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
LONGTERM_DEBT_LONGTERM_DEBT_FE
LONG-TERM DEBT LONG-TERM DEBT - FEES (Details) (USD $) | 3 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | ||||||||||||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Mar. 06, 2013 | Oct. 31, 2013 | Mar. 06, 2013 | Jan. 31, 2013 | Oct. 31, 2013 | Mar. 06, 2013 | Mar. 06, 2013 | Oct. 31, 2013 | Mar. 06, 2013 | Jan. 31, 2013 | Apr. 30, 2011 | Mar. 06, 2013 | |
2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2013 Amended Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | 2011 Credit Agreement | |||||
Term loan | Term loan | Term loan | Line of credit | Line of credit | Term loan | Term loan | Term loan | Term loan | Line of credit | |||||||
Debt Instrument | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred Finance Costs, Net | ' | ' | ' | ' | $7,500,000 | ' | $5,000,000 | ' | ' | $2,500,000 | $11,000,000 | ' | $7,500,000 | ' | ' | $3,500,000 |
Unamortized debt discount | ' | ' | ' | ' | ' | 2,944,000 | 3,300,000 | 0 | ' | ' | ' | 0 | 2,200,000 | 2,199,000 | 3,000,000 | ' |
Losses on extinguishments of debt | $0 | $0 | $9,879,000 | $0 | ' | ' | ' | ' | ' | ' | ' | $9,700,000 | ' | ' | ' | ' |
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | ' | ' | ' | ' | ' | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' | ' | ' |
LONGTERM_DEBT_LONGTERM_DEBT_IN1
LONG-TERM DEBT LONG-TERM DEBT - INTEREST EXPENSE (Details) (Credit Agreement, USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 |
Credit Agreement | ' | ' | ' | ' |
Debt Instrument | ' | ' | ' | ' |
Interest expense on debt | $6.60 | $6.80 | $19.70 | $20.30 |
Amortization of financing costs | 0.5 | 0.7 | 1.6 | 2.1 |
Amortization of debt discount | $0.10 | $0.10 | $0.30 | $0.30 |
LONGTERM_DEBT_LONGTERM_DEBT_FU
LONG-TERM DEBT LONG-TERM DEBT - FUTURE AMORTIZATION (Details) (2013 Amended Credit Agreement, USD $) | 9 Months Ended | |
Oct. 31, 2013 | Jan. 31, 2013 | |
Debt Instrument | ' | ' |
Interest Rate Premium Applicable To A Repricing Transaction | 1.00% | ' |
Debt Instrument Prepayment Adjustment Number of Consecutive Scheduled Principal Payments | 8 | ' |
Term loan | ' | ' |
Debt Instrument | ' | ' |
Long-term Debt, Maturities, Repayments of Principal, Remainder of Fiscal Year | $1,625,000 | ' |
Long-term Debt, Maturities, Repayments of Principal in Year Two | 6,500,000 | ' |
Long-term Debt, Maturities, Repayments of Principal in Year Three | 6,500,000 | ' |
Long-term Debt, Maturities, Repayments of Principal in Year Four | 6,500,000 | ' |
Long-term Debt, Maturities, Repayments of Principal in Year Five | 6,500,000 | ' |
Long-term Debt, Maturities, Repayments of Principal after Year Five | 619,125,000 | ' |
Long-term debt, gross | 646,750,000 | 0 |
Term loan - periodic payment of principal | $1,600,000 | ' |
LONGTERM_DEBT_LONGTERM_DEBT_OT
LONG-TERM DEBT LONG-TERM DEBT - OTHER DEBT (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | |||||||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Jan. 31, 2013 | Oct. 31, 2013 | Jan. 31, 2013 | Oct. 31, 2013 | Jan. 31, 2013 | Oct. 31, 2011 | |
Other long-term debt | Other long-term debt | Communications Intelligence Acquisition | Communications Intelligence Acquisition | Communications Intelligence Acquisition | ||||||
Other long-term debt | Other long-term debt | Other long-term debt | ||||||||
Debt Instrument | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Noncurrent Liabilities, Long-term Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | $3,300,000 |
Long-term debt | 643,915,000 | ' | 643,915,000 | ' | 576,689,000 | 109,000 | 2,888,000 | 100,000 | 2,500,000 | ' |
Repayments of debt | ' | ' | ' | ' | ' | ' | ' | 2,000,000 | ' | ' |
Losses on extinguishments of debt | $0 | $0 | $9,879,000 | $0 | ' | ' | ' | ($200,000) | ' | ' |
SUPPLEMENTAL_CONDENSED_CONSOLI2
SUPPLEMENTAL CONDENSED CONSOLIDATED FINANCIAL STATEMENT INFORMATION (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Jan. 31, 2013 |
Inventories | ' | ' | ' | ' | ' |
Raw materials | $3,837 | ' | $3,837 | ' | $4,263 |
Work-in-process | 6,039 | ' | 6,039 | ' | 5,633 |
Finished goods | 4,997 | ' | 4,997 | ' | 5,118 |
Total inventories | 14,873 | ' | 14,873 | ' | 15,014 |
Other income (expense), net: | ' | ' | ' | ' | ' |
Foreign currency (losses) gains, net | 702 | 1,144 | -2,504 | 1,267 | ' |
Gains on derivative financial instruments, net | -721 | -253 | -45 | -122 | ' |
Other, net | -627 | -1,231 | -2,464 | -1,334 | ' |
Other expense, net | -646 | -340 | -5,013 | -189 | ' |
Supplemental information regarding consolidated cash flows | ' | ' | ' | ' | ' |
Cash paid for interest | ' | ' | 17,724 | 20,546 | ' |
Cash (refunds) payments of income taxes, net | ' | ' | -6,463 | 14,807 | ' |
Non-cash investing and financing transactions: | ' | ' | ' | ' | ' |
Net non-cash assets acquired in CTI Merger | ' | ' | 3,727 | 0 | ' |
Accrued but unpaid purchases of property and equipment | ' | ' | 1,217 | 1,715 | ' |
Inventory transfers to property and equipment | ' | ' | 658 | 374 | ' |
Liabilities for contingent consideration in business combinations | 4,557 | 0 | 4,557 | 0 | ' |
Leasehold Improvements Funded by Lease Incentive | ' | ' | $0 | $5,014 | ' |
CONVERTIBLE_PREFERRED_STOCK_De
CONVERTIBLE PREFERRED STOCK (Details) (USD $) | Oct. 31, 2013 | Jan. 31, 2013 | Jan. 31, 2013 | Feb. 04, 2013 | 25-May-07 |
Series A Convertible Preferred Stock | Series A Convertible Preferred Stock | Comverse Technology Inc. | |||
Series A Convertible Preferred Stock | |||||
CONVERTIBLE PREFERRED STOCK | ' | ' | ' | ' | ' |
Series A convertible preferred stock, issued (in shares) | 0 | 293,000 | ' | ' | 293,000 |
Aggregate purchase price | ' | ' | ' | ' | $293,000,000 |
Temporary Equity, Carrying Amount | 0 | 285,542,000 | ' | 285,500,000 | ' |
Percentage of liquidation preference at which holders of preferred stock would have the right to require the repurchase the preferred stock in event of fundamental change | ' | ' | 100.00% | ' | ' |
Cumulative undeclared dividends | ' | ' | 72,900,000 | ' | ' |
Liquidation preference | $0 | $365,914,000 | $365,900,000 | ' | ' |
STOCKHOLDERS_EQUITY_TREASURY_S
STOCKHOLDERS' EQUITY - TREASURY STOCK/NONCONTROLLING INTEREST (Details) (USD $) | 1 Months Ended | 9 Months Ended | 12 Months Ended | ||
Apr. 30, 2012 | Oct. 31, 2012 | Jan. 31, 2011 | Oct. 31, 2013 | Jan. 31, 2013 | |
Equity, Class of Treasury Stock | ' | ' | ' | ' | ' |
Treasury stock, (in shares) | ' | ' | ' | 302,000 | 302,000 |
Treasury Stock, Value | ' | ' | ' | $8,013,000 | $8,013,000 |
Number of shares of common stock repurchased (in shares) | ' | 18,000 | ' | ' | ' |
Cost of shares of common stock repurchased | ' | 500,000 | ' | ' | ' |
Aggregate number of shares of common stock issued to certain current and former employees and a former director (in shares) | ' | ' | 135,000 | ' | ' |
Shares repurchased and retired (in shares) | 2,250 | ' | ' | ' | ' |
Noncontrolling Interest | ' | ' | ' | ' | ' |
Noncontrolling ownership percentage in joint venture (as a percent) | ' | ' | ' | 50.00% | ' |
Maximum | ' | ' | ' | ' | ' |
Equity, Class of Treasury Stock | ' | ' | ' | ' | ' |
Cost of treasury shares acquired and retired | 100,000 | ' | ' | ' | ' |
STOCKHOLDERS_EQUITY_STOCKHOLDE
STOCKHOLDERS' EQUITY STOCKHOLDERS' EQUITY - SCHEDULE OF ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 |
Activity in Accumulated Other Comprehensive Loss | ' | ' | ' | ' |
Accumulated other comprehensive income (loss) - beginning balance | ' | ' | ($44,225) | ' |
Other comprehensive income before reclassifications | ' | ' | 6,015 | ' |
Amounts reclassified out of accumulated other comprehensive income (loss) | -1,810 | 396 | -4,041 | 1,086 |
Net other comprehensive income (loss), current period | ' | ' | 1,974 | ' |
Accumulated other comprehensive income (loss) - ending balance | -42,251 | ' | -42,251 | ' |
Unrealized gains on derivative instruments designated as hedges | ' | ' | ' | ' |
Activity in Accumulated Other Comprehensive Loss | ' | ' | ' | ' |
Accumulated other comprehensive income (loss) - beginning balance | ' | ' | 2,447 | ' |
Other comprehensive income before reclassifications | ' | ' | 4,355 | ' |
Amounts reclassified out of accumulated other comprehensive income (loss) | ' | ' | -4,041 | ' |
Net other comprehensive income (loss), current period | ' | ' | 314 | ' |
Accumulated other comprehensive income (loss) - ending balance | 2,761 | ' | 2,761 | ' |
Unrealized gains on available-for-sale investments | ' | ' | ' | ' |
Activity in Accumulated Other Comprehensive Loss | ' | ' | ' | ' |
Accumulated other comprehensive income (loss) - beginning balance | ' | ' | 0 | ' |
Other comprehensive income before reclassifications | ' | ' | 3 | ' |
Amounts reclassified out of accumulated other comprehensive income (loss) | ' | ' | 0 | ' |
Net other comprehensive income (loss), current period | ' | ' | 3 | ' |
Accumulated other comprehensive income (loss) - ending balance | 3 | ' | 3 | ' |
Foreign currency translation adjustments | ' | ' | ' | ' |
Activity in Accumulated Other Comprehensive Loss | ' | ' | ' | ' |
Accumulated other comprehensive income (loss) - beginning balance | ' | ' | -46,672 | ' |
Other comprehensive income before reclassifications | ' | ' | 1,657 | ' |
Amounts reclassified out of accumulated other comprehensive income (loss) | ' | ' | 0 | ' |
Net other comprehensive income (loss), current period | ' | ' | 1,657 | ' |
Accumulated other comprehensive income (loss) - ending balance | ($45,015) | ' | ($45,015) | ' |
STOCKHOLDERS_EQUITY_STOCKHOLDE1
STOCKHOLDERS' EQUITY STOCKHOLDERS' EQUITY - AMOUNTS RECLASSIFIED OUT OF ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 |
Reclassifications Out of Accumulated Other Comprehensive Income (Loss) | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | ($1,984) | $440 | ($4,348) | $1,205 |
Other Comprehensive Income (Loss), Reclassification Adjustment on Derivatives Included in Net Income, Tax | -174 | 44 | -307 | 119 |
Amounts reclassified out of accumulated other comprehensive income (loss) | -1,810 | 396 | -4,041 | 1,086 |
Cost of revenue - product | ' | ' | ' | ' |
Reclassifications Out of Accumulated Other Comprehensive Income (Loss) | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | -167 | 37 | -370 | 114 |
Cost of revenue - service and support | ' | ' | ' | ' |
Reclassifications Out of Accumulated Other Comprehensive Income (Loss) | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | -178 | 43 | -383 | 109 |
Research and development, net | ' | ' | ' | ' |
Reclassifications Out of Accumulated Other Comprehensive Income (Loss) | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | -1,123 | 238 | -2,455 | 646 |
Selling, general and administrative | ' | ' | ' | ' |
Reclassifications Out of Accumulated Other Comprehensive Income (Loss) | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | ($516) | $122 | ($1,140) | $336 |
INCOME_TAXES_INCOME_TAXES_PROV
INCOME TAXES INCOME TAXES - PROVISION FOR INCOME TAXES (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Jan. 31, 2013 | |
Income Tax Disclosure [Abstract] | ' | ' | ' | ' | ' |
Provision for income taxes | $5,957,000 | $2,243,000 | $11,869,000 | $9,414,000 | ' |
Income before provision for income taxes | 30,011,000 | 8,858,000 | 46,491,000 | 40,924,000 | ' |
Effective income tax rate (as a percent) | 19.80% | 25.30% | 25.50% | 23.00% | ' |
U.S. federal statutory income tax rate (as a percent) | 35.00% | 35.00% | ' | 35.00% | ' |
Unrecognized tax benefits | 142,100,000 | ' | 142,100,000 | ' | 55,400,000 |
Unrecognized tax benefits, income tax penalties and interest accrued | 20,000,000 | ' | 20,000,000 | ' | 8,300,000 |
Unrecognized tax benefits that would impact effective tax rate | 137,300,000 | ' | 137,300,000 | ' | 50,800,000 |
Unrecognized tax benefits, decreases resulting from settlements with taxing authorities | $2,400,000 | ' | $2,400,000 | ' | ' |
FAIR_VALUE_MEASUREMENTS_FAIR_V
FAIR VALUE MEASUREMENTS - FAIR VALUE TABLE (Details) (Recurring, USD $) | Oct. 31, 2013 | Jan. 31, 2013 |
In Thousands, unless otherwise specified | ||
Level 1 | ' | ' |
Assets: | ' | ' |
Money market funds | $45,538 | $62,085 |
Short-term investments classified as available-for-sale | 0 | ' |
Commercial paper | ' | 0 |
Foreign currency forward contracts | 0 | 0 |
Total assets | 45,538 | 62,085 |
Liabilities: | ' | ' |
Foreign currency forward contracts | 0 | 0 |
Contingent consideration- business combinations | 0 | 0 |
Total liabilities | 0 | 0 |
Level 2 | ' | ' |
Assets: | ' | ' |
Money market funds | 0 | 0 |
Short-term investments classified as available-for-sale | 113,592 | ' |
Commercial paper | ' | 4,000 |
Foreign currency forward contracts | 3,262 | 2,854 |
Total assets | 116,854 | 6,854 |
Liabilities: | ' | ' |
Foreign currency forward contracts | 1,040 | 542 |
Contingent consideration- business combinations | 0 | 0 |
Total liabilities | 1,040 | 542 |
Level 3 | ' | ' |
Assets: | ' | ' |
Money market funds | 0 | 0 |
Short-term investments classified as available-for-sale | 0 | ' |
Commercial paper | ' | 0 |
Foreign currency forward contracts | 0 | 0 |
Total assets | 0 | 0 |
Liabilities: | ' | ' |
Foreign currency forward contracts | 0 | 0 |
Contingent consideration- business combinations | 10,869 | 25,041 |
Total liabilities | $10,869 | $25,041 |
FAIR_VALUE_MEASUREMENTS_CONTIN
FAIR VALUE MEASUREMENTS - CONTINGENT CONSIDERATION TABLE (Details) (Liability for contingent consideration, USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 |
Changes in the estimated fair value of liability for contingent consideration measured using significant unobservable inputs (Level 3) | ' | ' |
Fair value measurement at the beginning of the period | $25,041 | $38,646 |
Contingent consideration liabilities recorded in business combinations | 4,557 | 0 |
Changes in fair values, recorded in operating expenses | -1,635 | -8,428 |
Payments of contingent consideration | -17,094 | -6,902 |
Fair value measurement at the end of the period | $10,869 | $23,316 |
Minimum | ' | ' |
Changes in the estimated fair value of liability for contingent consideration measured using significant unobservable inputs (Level 3) | ' | ' |
Discount rates (as a percent) | 1.70% | 3.10% |
Maximum | ' | ' |
Changes in the estimated fair value of liability for contingent consideration measured using significant unobservable inputs (Level 3) | ' | ' |
Discount rates (as a percent) | 15.00% | 16.50% |
FAIR_VALUE_MEASUREMENTS_OTHER_
FAIR VALUE MEASUREMENTS - OTHER FAIR VALUE DISCLOSURES (Details) (Level 3, Estimated fair value, Term loan, USD $) | Oct. 31, 2013 | Jan. 31, 2013 |
In Millions, unless otherwise specified | ||
Level 3 | Estimated fair value | Term loan | ' | ' |
Other Financial Instruments | ' | ' |
Long-term debt | $647 | $583 |
DERIVATIVE_FINANCIAL_INSTRUMEN2
DERIVATIVE FINANCIAL INSTRUMENTS - ASSETS AND LIABILITIES (Details) (Foreign currency forward contracts, USD $) | 9 Months Ended | |
Oct. 31, 2013 | Jan. 31, 2013 | |
Fair Values of Derivative Financial Instruments | ' | ' |
Term to maturity of derivative contracts is generally this period (in months) | '12 months | ' |
Notional amounts of derivative financial instruments | $121,000,000 | $108,100,000 |
Derivative designated as hedging instruments | ' | ' |
Fair Values of Derivative Financial Instruments | ' | ' |
Assets, Fair Value | 3,262,000 | 2,808,000 |
Liabilities, Fair Value | 236,000 | 64,000 |
Derivative not designated as hedging instruments | ' | ' |
Fair Values of Derivative Financial Instruments | ' | ' |
Assets, Fair Value | 0 | 46,000 |
Liabilities, Fair Value | $804,000 | $478,000 |
DERIVATIVE_FINANCIAL_INSTRUMEN3
DERIVATIVE FINANCIAL INSTRUMENTS - GAINS AND LOSSES (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Jan. 31, 2013 | |
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ' | ' | ' | ' |
Net Gains (Losses) Reclassified from Other Comprehensive Loss into the Condensed Consolidated Statements of Operations | ($1,984,000) | $440,000 | ($4,348,000) | $1,205,000 | ' |
Foreign currency forward contracts | Derivative designated as hedging instruments | ' | ' | ' | ' | ' |
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ' | ' | ' | ' |
Foreign currency forward contracts underlying net unrealized gains recorded in accumulated other comprehensive loss expected to be reclassified into earnings within the next twelve months | 2,800,000 | ' | 2,800,000 | ' | ' |
Foreign currency forward contracts | Derivative not designated as hedging instruments | ' | ' | ' | ' | ' |
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ' | ' | ' | ' |
Losses recognized on derivatives not designated as hedges | -721,000 | -254,000 | -44,000 | -123,000 | ' |
Foreign currency forward contracts | Cash flow hedging | Derivative designated as hedging instruments | ' | ' | ' | ' | ' |
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ' | ' | ' | ' |
Net Unrealized Gains Recognized in Accumulated Other Comprehensive Loss | 2,761,000 | ' | 2,761,000 | ' | 2,447,000 |
Net Gains (Losses) Reclassified from Other Comprehensive Loss into the Condensed Consolidated Statements of Operations | 1,984,000 | -440,000 | 4,348,000 | -1,205,000 | ' |
Gains (losses) from ineffectiveness | ' | ' | $0 | $0 | ' |
STOCKBASED_COMPENSATION_STOCKB
STOCK-BASED COMPENSATION - STOCK-BASED COMPENSATION EXPENSE (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | $9,729 | $6,685 | $25,154 | $18,318 |
Equity-classified awards | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 8,318 | 4,550 | 22,304 | 15,022 |
Equity-Settled Awards | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 8,318 | 4,550 | 22,006 | 15,544 |
Other liability-classified awards | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 1,411 | 2,135 | 3,148 | 2,774 |
Stock options | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 45 | 59 | 152 | 236 |
Restricted stock awards and restricted stock units | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 8,335 | 4,605 | 21,727 | 15,050 |
Phantom stock units | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 23 | 28 | 87 | 517 |
Stock Bonus Program | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 1,326 | 1,993 | 3,188 | 2,515 |
Stock Bonus Program | Equity-classified awards | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 0 | 0 | -298 | 522 |
Cost of revenue - product | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 243 | 257 | 572 | 583 |
Cost of revenue - service and support | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 458 | 564 | 1,208 | 1,531 |
Research and development, net | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 890 | 769 | 2,432 | 1,906 |
Selling, general and administrative | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | $8,138 | $5,095 | $20,942 | $14,298 |
STOCKBASED_COMPENSATION_STOCKB1
STOCK-BASED COMPENSATION STOCK-BASED COMPENSATION - STOCK OPTIONS (Details) (USD $) | 9 Months Ended | |
Share data in Thousands, except Per Share data, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 |
Stock Options - Additional Information | ' | ' |
Proceeds from exercises of stock options | $6,432,000 | $1,771,000 |
Stock Options | ' | ' |
Stock Option Activity - Outstanding Options | ' | ' |
Beginning balance (in shares) | 924 | ' |
Exercises of stock options (in shares) | -246 | ' |
Options forfeited or expired (in shares) | -15 | ' |
Ending balance (in shares) | 663 | ' |
Stock Option Activity - Weighted-Average Exercise Prices | ' | ' |
Beginning balance (in dollars per share) | $31.88 | ' |
Options exercised (in dollars per share) | $26.20 | ' |
Options forfeited or expired (in dollars per share) | $24.88 | ' |
Ending balance (in dollars per share) | $34.14 | ' |
Stock Options - Additional Information | ' | ' |
Stock options - exercisable (in shares) | 658 | ' |
Weighted-average exercise price of exercisable stock options (in dollars per share) | $34.35 | ' |
Proceeds from exercises of stock options | 6,400,000 | ' |
Unrecognized compensation expense | $100,000 | ' |
Remaining period over which unrecognized compensation is to be recognized | '1 year | ' |
STOCKBASED_COMPENSATION_STOCKB2
STOCK-BASED COMPENSATION STOCK-BASED COMPENSATION - RSUs (Details) (Restricted Stock Units (RSUs), USD $) | 9 Months Ended |
In Millions, except Share data in Thousands, unless otherwise specified | Oct. 31, 2013 |
Restricted Stock Units (RSUs) | ' |
Restricted Stock Unit Activity - Outstanding RSUs | ' |
Beginning balance (in shares) | 1,536 |
Granted (in shares) | 1,537 |
Released (in shares) | -776 |
Forfeited (in shares) | -78 |
Ending balance (in shares) | 2,219 |
Restricted Stock Unit Activity - Weighted-Average Grant Date Fair Values | ' |
Beginning balance (in dollars per share) | $31.42 |
Granted (in dollars per share) | $33.16 |
Released (in dollars per share) | $31.67 |
Forfeited (in dollars per share) | $31.79 |
Ending balance (in dollars per share) | $32.51 |
Restricted Stock Units - Additional Disclosures | ' |
Unrecognized compensation expense | $52.80 |
Remaining period over which unrecognized compensation is to be recognized | '2 years 2 months |
STOCKBASED_COMPENSATION_STOCKB3
STOCK-BASED COMPENSATION STOCK-BASED COMPENSATION - PHANTOM STOCK (Details) (Phantom stock units, USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Oct. 31, 2013 | Jan. 31, 2013 |
Phantom stock units | ' | ' |
Stock-Based Compensation Plans | ' | ' |
Phantom stock - cash used to settle awards | $0.20 | ' |
Total accrued liability | $0.10 | $0.20 |
STOCKBASED_COMPENSATION_STOCKB4
STOCK-BASED COMPENSATION STOCK-BASED COMPENSATION - STOCK BONUS PROGRAM (Details) (USD $) | 12 Months Ended | 9 Months Ended | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Jan. 31, 2011 | Oct. 31, 2013 | Jan. 31, 2014 | Oct. 31, 2013 | Jan. 31, 2013 |
Stock Bonus Program | Stock Bonus Program | Stock Bonus Program | Stock Bonus Program | ||
Stock-Based Compensation Plans | ' | ' | ' | ' | ' |
Stock Bonus Plan, Determination of Shares Issuable Trailing Period of Average Price of Common Stock (in days) | ' | '5 days | ' | ' | ' |
Stock Bonus Program, Number of Shares Authorized (in shares) | ' | ' | 150,000 | ' | 150,000 |
Discount from market price (as a percent) | ' | ' | 15.00% | ' | 15.00% |
Number of shares issued (in shares) | 135,000 | 80,000 | ' | 93,000 | ' |
Vesting period (in years) | ' | ' | '1 year | ' | ' |
Total accrued liability | ' | $3.50 | ' | $3.50 | $3.10 |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details) (USD $) | Jan. 31, 2013 | Apr. 30, 2012 |
In Millions, unless otherwise specified | Comverse Technology Inc. | |
Related Party Transaction [Line Items] | ' | ' |
Beneficial ownership position held by parent (as a percent) | 53.50% | ' |
Payments for I.T. Licenses | ' | $0.30 |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES COMMITMENTS AND CONTINGENCIES - WARRANTY OBLIGATIONS (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 |
Activity in Product Warranty Accrual | ' | ' |
Warranty liability, beginning of period | $1,045 | $2,015 |
Provisions credited to expenses | -253 | -701 |
Warranty charges | 0 | -188 |
Foreign currency translation and other | -2 | -8 |
Warranty liability, end of period | $790 | $1,118 |
COMMITMENTS_AND_CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES COMMITMENTS AND CONTINGENCIES - LITIGATION (Details) (USD $) | 9 Months Ended |
In Millions, unless otherwise specified | Oct. 31, 2013 |
Loss Contingency, Information about Litigation Matters | ' |
Litigation damages sought (in dollars) | $150 |
SEGMENT_INFORMATION_SEGMENT_OP
SEGMENT INFORMATION - SEGMENT OPERATING RESULTS (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 |
segment | ||||
Segment Reporting [Abstract] | ' | ' | ' | ' |
Number of operating segments | ' | ' | 3 | ' |
Revenue: | ' | ' | ' | ' |
Total revenue | $224,314 | $201,520 | $651,547 | $610,581 |
Reconciliation of segment contribution to operating income: | ' | ' | ' | ' |
Amortization of acquired intangible assets | 8,100 | 9,800 | 26,100 | 29,500 |
Stock-based compensation expense | 9,729 | 6,685 | 25,154 | 18,318 |
Total operating expenses | 114,326 | 119,467 | 350,668 | 336,974 |
Operating income | 37,831 | 16,771 | 82,807 | 64,017 |
Other expense, net | -7,820 | -7,913 | -36,316 | -23,093 |
Income before provision for income taxes | 30,011 | 8,858 | 46,491 | 40,924 |
Enterprise Intelligence | ' | ' | ' | ' |
Revenue: | ' | ' | ' | ' |
Segment revenue | 126,220 | 122,245 | 365,385 | 351,659 |
Revenue adjustments | -323 | -443 | -692 | -3,655 |
Total revenue | 125,897 | 121,802 | 364,693 | 348,004 |
Segment Contribution: | ' | ' | ' | ' |
Segment Contribution | 56,772 | 52,139 | 155,169 | 147,102 |
Video Intelligence | ' | ' | ' | ' |
Revenue: | ' | ' | ' | ' |
Segment revenue | 27,287 | 25,587 | 88,388 | 93,916 |
Revenue adjustments | 0 | -348 | -167 | -1,840 |
Total revenue | 27,287 | 25,239 | 88,221 | 92,076 |
Segment Contribution: | ' | ' | ' | ' |
Segment Contribution | 5,546 | 3,992 | 20,482 | 23,027 |
Communications Intelligence | ' | ' | ' | ' |
Revenue: | ' | ' | ' | ' |
Segment revenue | 71,249 | 54,817 | 199,163 | 172,381 |
Revenue adjustments | -119 | -338 | -530 | -1,880 |
Total revenue | 71,130 | 54,479 | 198,633 | 170,501 |
Segment Contribution: | ' | ' | ' | ' |
Segment Contribution | 24,457 | 18,693 | 62,223 | 49,826 |
Total operating segments | ' | ' | ' | ' |
Revenue: | ' | ' | ' | ' |
Total revenue | 224,314 | 201,520 | 651,547 | 610,581 |
Segment Contribution: | ' | ' | ' | ' |
Segment Contribution | 86,775 | 74,824 | 237,874 | 219,955 |
Unallocated Expenses | ' | ' | ' | ' |
Reconciliation of segment contribution to operating income: | ' | ' | ' | ' |
Amortization of acquired intangible assets | 8,085 | 9,805 | 26,113 | 29,466 |
Stock-based compensation expense | 9,729 | 6,685 | 25,154 | 18,318 |
Other unallocated expenses | 31,130 | 41,563 | 103,800 | 108,154 |
Total operating expenses | 48,944 | 58,053 | 155,067 | 155,938 |
Operating income | 37,831 | 16,771 | 82,807 | 64,017 |
Other expense, net | -7,820 | -7,913 | -36,316 | -23,093 |
Income before provision for income taxes | $30,011 | $8,858 | $46,491 | $40,924 |