Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Jul. 25, 2018 | |
Document And Entity Information [Abstract] | ||
Document type | 10-Q | |
Amendment flag | false | |
Document period end date | Jun. 30, 2018 | |
Document fiscal year focus | 2,018 | |
Document fiscal period focus | Q2 | |
Trading symbol | blkb | |
Entity registrant name | BLACKBAUD INC | |
Entity central index key | 1,280,058 | |
Current fiscal year end date | --12-31 | |
Entity filer category | Large Accelerated Filer | |
Entity common stock, shares outstanding | 48,584,111 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 29,194 | $ 29,830 |
Restricted cash due to customers | 295,463 | 610,344 |
Accounts receivable, net of allowance of $5,501 and $5,141 at June 30, 2018 and December 31, 2017, respectively | 130,509 | 95,679 |
Customer funds receivable | 5,528 | 1,536 |
Prepaid expenses and other current assets | 75,816 | 61,978 |
Total current assets | 536,510 | 799,367 |
Property and equipment, net | 44,531 | 42,243 |
Software development costs, net | 62,023 | 54,098 |
Goodwill | 547,312 | 530,249 |
Intangible assets, net | 317,220 | 314,651 |
Other assets | 64,089 | 57,238 |
Total assets | 1,571,685 | 1,797,846 |
Current liabilities: | ||
Trade accounts payable | 31,141 | 24,693 |
Accrued expenses and other current liabilities | 46,182 | 54,399 |
Due to customers | 300,991 | 611,880 |
Debt, current portion | 8,576 | 8,576 |
Deferred revenue, current portion | 306,365 | 275,063 |
Total current liabilities | 693,255 | 974,611 |
Debt, net of current portion | 471,236 | 429,648 |
Deferred tax liability | 48,055 | 48,023 |
Deferred revenue, net of current portion | 3,442 | 3,643 |
Other liabilities | 7,474 | 5,632 |
Total liabilities | 1,223,462 | 1,461,557 |
Commitments and contingencies (see Note 10) | ||
Stockholders' equity: | ||
Preferred stock; 20,000,000 shares authorized, none outstanding | 0 | 0 |
Common stock, $0.001 par value; 180,000,000 shares authorized, 59,301,209 and 58,551,761 shares issued at June 30, 2018 and December 31, 2017, respectively | 59 | 59 |
Additional paid-in capital | 375,949 | 351,042 |
Treasury stock, at cost; 10,735,926 and 10,475,794 shares at June 30, 2018 and December 31, 2017, respectively | (264,383) | (239,199) |
Accumulated other comprehensive loss | (1,011) | (642) |
Retained earnings | 237,609 | 225,029 |
Total stockholders' equity | 348,223 | 336,289 |
Total liabilities and stockholders' equity | $ 1,571,685 | $ 1,797,846 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance | $ 5,501 | $ 5,141 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 180,000,000 | 180,000,000 |
Common stock, shares issued | 59,301,209 | 58,551,761 |
Treasury stock, shares | 10,735,926 | 10,475,794 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenue | ||||
Recurring | $ 192,749 | $ 166,389 | $ 373,595 | $ 326,436 |
One-time services and other | 20,923 | 25,200 | 44,261 | 50,225 |
Total revenue | 213,672 | 191,589 | 417,856 | 376,661 |
Cost of revenue | ||||
Cost of recurring | 76,350 | 66,178 | 145,429 | 130,053 |
Cost of one-time services and other | 18,822 | 20,817 | 37,780 | 42,424 |
Total cost of revenue | 95,172 | 86,995 | 183,209 | 172,477 |
Gross profit | 118,500 | 104,594 | 234,647 | 204,184 |
Operating expenses | ||||
Sales, marketing and customer success | 48,493 | 42,580 | 93,970 | 83,577 |
Research and development | 25,297 | 22,870 | 51,255 | 45,576 |
General and administrative | 28,447 | 21,882 | 53,498 | 43,805 |
Amortization | 1,201 | 739 | 2,470 | 1,430 |
Restructuring | 3,688 | 0 | 4,499 | 0 |
Total operating expenses | 107,126 | 88,071 | 205,692 | 174,388 |
Income from operations | 11,374 | 16,523 | 28,955 | 29,796 |
Interest expense | (4,303) | (3,216) | (7,820) | (5,593) |
Other income, net | 346 | 827 | 506 | 1,113 |
Income before provision for income taxes | 7,417 | 14,134 | 21,641 | 25,316 |
Income tax provision (benefit) | 825 | 3,105 | (2,702) | 1,145 |
Net income | $ 6,592 | $ 11,029 | $ 24,343 | $ 24,171 |
Earnings per share | ||||
Basic earnings per share | $ 0.14 | $ 0.24 | $ 0.52 | $ 0.52 |
Diluted earnings per share | $ 0.14 | $ 0.23 | $ 0.51 | $ 0.51 |
Common shares and equivalents outstanding | ||||
Basic weighted average shares | 47,222,657 | 46,662,481 | 47,121,692 | 46,584,263 |
Diluted weighted average shares outstanding | 48,053,094 | 47,691,340 | 48,030,547 | 47,586,893 |
Dividends per share (in dollars per share) | $ 0.12 | $ 0.12 | $ 0.24 | $ 0.24 |
Other comprehensive (loss) income | ||||
Foreign currency translation adjustment | $ (8,817) | $ (349) | $ (2,380) | $ (197) |
Unrealized gain (loss) on derivative instruments, net of tax | 765 | (4) | 1,844 | 178 |
Total other comprehensive loss | (8,052) | (353) | (536) | (19) |
Comprehensive (loss) income | $ (1,460) | $ 10,676 | $ 23,807 | $ 24,152 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows $ in Thousands | 6 Months Ended | |
Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | |
Cash flows from operating activities | ||
Net income | $ 24,343 | $ 24,171 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 39,847 | 36,481 |
Provision for doubtful accounts and sales returns | 3,697 | 5,469 |
Stock-based compensation expense | 24,953 | 20,129 |
Deferred taxes | 1,121 | (1,524) |
Amortization of deferred financing costs and discount | 376 | 468 |
Other non-cash adjustments | (419) | (540) |
Changes in operating assets and liabilities, net of acquisition and disposal of businesses: | ||
Accounts receivable | (38,092) | (44,809) |
Prepaid expenses and other assets | (18,629) | (3,262) |
Trade accounts payable | 6,327 | (3,951) |
Accrued expenses and other liabilities | (6,675) | (8,467) |
Deferred revenue | 29,545 | 30,386 |
Net cash provided by operating activities | 66,394 | 54,551 |
Cash flows from investing activities | ||
Purchase of property and equipment | (9,575) | (5,666) |
Capitalized software development costs | (16,359) | (13,614) |
Purchase of net assets of acquired companies, net of cash and restricted cash acquired | (45,315) | (49,729) |
Purchase of derivative instruments | 0 | (516) |
Net cash used in investing activities | (71,249) | (69,525) |
Cash flows from financing activities | ||
Proceeds from issuance of debt | 173,500 | 575,700 |
Payments on debt | (132,150) | (529,169) |
Debt issuance costs | 0 | (3,085) |
Employee taxes paid for withheld shares upon equity award settlement | (25,184) | (16,644) |
Proceeds from exercise of stock options | 11 | 14 |
Change in due to customers | (309,189) | (85,581) |
Change in customer funds receivable | (4,391) | 0 |
Dividend payments to stockholders | (11,653) | (11,530) |
Net cash used in financing activities | (309,056) | (70,295) |
Effect of exchange rate on cash, cash equivalents, and restricted cash | (1,606) | (196) |
Net decrease in cash, cash equivalents, and restricted cash | (315,517) | (85,465) |
Cash, cash equivalents, and restricted cash, beginning of period | 640,174 | 370,673 |
Cash, cash equivalents, and restricted cash, end of period | 324,657 | $ 285,208 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract] | ||
Cash and cash equivalents | 29,194 | |
Restricted cash due to customers | 295,463 | |
Total cash, cash equivalents and restricted cash in the statement of cash flows | $ 324,657 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - 6 months ended Jun. 30, 2018 - USD ($) $ in Thousands | Total | Common stock [Member] | Additional paid-in capital [Member] | Treasury stock [Member] | Accumulated other comprehensive loss [Member] | Retained earnings [Member] |
Balance (in shares) at Dec. 31, 2017 | 58,551,761 | |||||
Balance at Dec. 31, 2017 | $ 336,289 | $ 59 | $ 351,042 | $ (239,199) | $ (642) | $ 225,029 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 24,343 | 24,343 | ||||
Payment of dividends | (11,653) | (11,653) | ||||
Exercise of stock options and stock appreciation rights and vesting of restricted stock units (in shares) | 320,163 | |||||
Exercise of stock options and stock appreciation rights and vesting of restricted stock units | 11 | 11 | ||||
Employee taxes paid for 260,132 withheld shares upon equity award settlement | (25,184) | (25,184) | ||||
Stock-based compensation | 24,953 | 24,896 | 57 | |||
Restricted stock grants (in shares) | 506,191 | |||||
Restricted stock grants | 0 | $ 0 | ||||
Restricted stock cancellations (in shares) | (76,906) | |||||
Other comprehensive loss | (536) | (536) | ||||
Reclassification upon early adoption of ASU 2018-02 | (167) | 167 | (167) | |||
Balance (in shares) at Jun. 30, 2018 | 59,301,209 | |||||
Balance at Jun. 30, 2018 | $ 348,223 | $ 59 | $ 375,949 | $ (264,383) | $ (1,011) | $ 237,609 |
Consolidated Statements of Sto7
Consolidated Statements of Stockholders' Equity (Parenthetical) | 6 Months Ended |
Jun. 30, 2018shares | |
Statement of Stockholders' Equity [Abstract] | |
Surrender of shares upon vesting of restricted stock and restricted stock units and exercise of stock appreciation rights | 260,132 |
Organization
Organization | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | 1. Organization We are the world’s leading cloud software company powering social good. Serving the entire social good community—nonprofits, foundations, companies, education institutions, healthcare organizations and individual change agents—we connect and empower organizations to increase their impact through cloud software, services, expertise and data intelligence. Our portfolio is tailored to the unique needs of vertical markets, with solutions for fundraising and CRM, marketing, advocacy, peer-to-peer fundraising, corporate social responsibility, school management, ticketing, grantmaking, financial management, payment processing and analytics. Serving the industry for more than three decades, we are headquartered in Charleston, South Carolina and have operations in the United States, Australia, Canada and the United Kingdom. As of June 30, 2018 , we had over 40,000 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | 2. Basis of Presentation Unaudited interim consolidated financial statements The accompanying interim consolidated financial statements have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission ("SEC") for interim financial reporting. These consolidated statements are unaudited and, in the opinion of management, include all adjustments (consisting of normal recurring adjustments and accruals) necessary to state fairly the consolidated balance sheets, consolidated statements of comprehensive income, consolidated statements of cash flows and consolidated statement of stockholders’ equity, for the periods presented in accordance with accounting principles generally accepted in the United States ("GAAP"). The consolidated balance sheet at December 31, 2017 , has been derived from the audited consolidated financial statements at that date. Operating results and cash flows for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2018 , or any other future period. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted in accordance with the rules and regulations for interim reporting of the SEC. These interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2017 , and other forms filed with the SEC from time to time. Reclassifications Our revenue from "subscriptions" and "maintenance" and a portion of our "services and other" revenue have been combined within "recurring" revenue beginning in 2018. In order to provide comparability between periods presented, those amounts of revenue have been combined within "recurring" revenue in the previously reported consolidated statements of comprehensive income to conform to presentation of the current period. Similarly, "cost of subscriptions" and "cost of maintenance" and a portion of "cost of services and other" have been combined within "cost of recurring" in the previously reported consolidated statements of comprehensive income to conform to presentation of the current period. "Services and other" revenue has been renamed as "one-time services and other" and consists of revenue that did not meet the description of "recurring" revenue in the consolidated statements of comprehensive income. " Cost of services and other" has been renamed as "cost of one-time services and other" and consists of costs that did not meet the description of those related to "recurring" revenue in the consolidated statements of comprehensive income. Basis of consolidation The consolidated financial statements include the accounts of Blackbaud, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Reportable segment We report our operating results and financial information in one operating and reportable segment. Our chief operating decision maker uses consolidated financial information to make operating decisions, assess financial performance and allocate resources. Our chief operating decision maker is our chief executive officer ("CEO"). Recently adopted accounting pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"), which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. ASU 2014-09 replaces most previous revenue recognition guidance in GAAP and requires the recognition of revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also provides guidance on the recognition of costs related to obtaining and fulfilling customer contracts. We adopted ASU 2014-09 as of January 1, 2018 utilizing the full retrospective method of transition, which requires that the standard be applied to all periods presented. The impact of adopting ASU 2014-09 on our total revenues for 2017 and 2016 was not material. The primary impacts of adopting ASU 2014-09 relate to the deferral of incremental commission and other costs of obtaining contracts with customers and the increase to the amortization period for those costs. Previously, we deferred only direct and incremental commission costs to obtain a contract and amortized those costs over the contract term, generally three years, as the revenue was recognized. Under the new standard, we defer all incremental commission and related fringe benefit costs to obtain a contract and amortize these costs in a manner that aligns with the expected period of benefit. We utilized the 'portfolio approach' practical expedient in ASC 606-10-10-4, which allows entities to apply the guidance to a portfolio of contracts with similar characteristics because the effects on the financial statements of this approach would not differ materially from applying the guidance to individual contracts. Using the 'portfolio approach' and taking into consideration our customer contracts, our technology and other factors, we determined the expected period of benefit to be five years. We do not generally pay commissions for contract renewals. Select adjusted unaudited financial statement information, which reflects our adoption of ASU 2014-09 is set forth below. Consolidated balance sheets: As of December 31, 2017 (dollars in thousands) As Reported Adjustments As Adjusted Accounts receivable, net of allowance $ 96,293 $ (614 ) $ 95,679 Prepaid expenses and other current assets $ 56,099 $ 5,879 $ 61,978 Other assets $ 24,083 $ 33,155 $ 57,238 Deferred revenue, current portion $ 276,456 $ (1,393 ) $ 275,063 Deferred tax liability $ 37,597 $ 10,426 $ 48,023 Retained earnings $ 195,649 $ 29,380 $ 225,029 Consolidated statements of comprehensive income: Three months ended June 30, 2017 Six months ended June 30, 2017 (dollars in thousands, except per share amounts) As Reported (1) Adjustments As Adjusted As Reported (1) Adjustments As Adjusted Revenue Recurring $ 158,169 $ 8,220 $ 166,389 $ 310,129 $ 16,307 $ 326,436 One-time services and other 34,026 (8,826 ) 25,200 65,687 (15,462 ) 50,225 Total revenue $ 192,195 $ (606 ) $ 191,589 $ 375,816 $ 845 $ 376,661 Cost of Revenue Recurring $ 63,236 $ 2,942 $ 66,178 $ 124,144 $ 5,909 $ 130,053 One-time services and other 23,759 (2,942 ) 20,817 48,333 (5,909 ) 42,424 Total cost of revenue $ 86,995 $ — $ 86,995 $ 172,477 $ — $ 172,477 Operating expenses Sales, marketing and customer success $ 42,961 $ (381 ) $ 42,580 $ 85,201 $ (1,624 ) $ 83,577 Net income $ 11,165 $ (136 ) $ 11,029 $ 22,676 $ 1,495 $ 24,171 Basic earnings per share $ 0.24 $ — $ 0.24 $ 0.49 $ 0.03 $ 0.52 Diluted earnings per share $ 0.23 $ — $ 0.23 $ 0.48 $ 0.03 $ 0.51 (1) See the discussion of our reclassifications of previously reported revenue and costs of revenue above. Our adoption of ASU 2014-09 had no impact on our net cash provided by or used in operating, investing or financing activities for any of the periods reported. Except for the accounting policies for revenue recognition and deferred commissions (herein referred to as "costs of obtaining contracts") that were updated as a result of adopting ASU 2014-09, there have been no changes to our significant accounting policies described in the Annual Report on Form 10-K for the year ended December 31, 2017, filed with the SEC on February 20, 2018, that have had a material impact on our consolidated financial statements. In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”), which allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the U.S. Tax Cuts and Jobs Act (the “Tax Act”) signed into law in December 2017. We early adopted ASU 2018-02 effective January 1, 2018 and recorded an insignificant reclassification for the stranded tax effects resulting from the Tax Act from accumulated other comprehensive loss to retained earnings. Summary of significant accounting policies Revenue Recognition Our revenue is primarily generated from the following sources: (i) charging for the use of our software solutions in cloud-based and hosted environments; (ii) providing payment and transaction services; (iii) providing software maintenance and support services; and (iv) providing professional services, including implementation, consulting, training, analytic and other services. Revenues are recognized when control of these services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those services. We determine revenue recognition through the following steps: • Identification of the contract, or contracts, with a customer; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when, or as, we satisfy a performance obligation. Recurring Recurring revenue represents stand-ready performance obligations in which we are making our solutions or services available to our customers continuously over time or the value of the contract renews. Therefore, recurring revenue is generally recognized over time on a ratable basis over the contract term, beginning on the date that the solution or service is made available to the customer. Our recurring revenue contracts are generally for a term of three years at contract inception with one to three -year renewals thereafter, billed annually in advance and non-cancelable. Recurring revenue is comprised of fees for the use of our subscription-based software solutions, which includes providing access to cloud-based solutions, hosting services, online training programs, subscription-based analytic services, such as donor acquisitions and data enrichment, and payment services. Recurring revenue also includes fees from maintenance services for our on-premises solutions, services included in our renewable subscription contracts, subscription-based contracts for professional services and variable transaction revenue associated with the use of our solutions. Our payment services are offered with the assistance of third-party vendors. In general, when we are the principal in a transaction based on the factors identified in ASC 606-10-55-36 through 55-40, we record the revenue and related costs on a gross basis. Otherwise, we net the cost of revenue associated with the service against the gross revenue (amount billed to the customer) and record the net amount as revenue. For payment and transaction services, we have the right to invoice the customer in an amount that directly corresponds with the value to the customer of our performance to date. Therefore, we recognize revenue for these services over time based on the amount billable to the customer in accordance with the 'as invoiced' practical expedient in ASC 606-10-55-18. One-time services and other One-time services and other revenue primarily consists of fees for one-time consulting, analytic and onsite training services. We generally bill consulting services based on hourly rates plus reimbursable travel-related expenses. Fixed price consulting engagements are generally billed as milestones towards completion are reached. Revenue for all consulting services is recognized over time as the services are performed. We generally recognize analytic services revenue from donor prospect research engagements, the sale of lists of potential donors, data enrichment engagements and benchmarking studies at a point in time (upon delivery). In certain cases, we sell training at a fixed rate for each specific class at a per attendee price or at a packaged price for several attendees, and recognize the related revenue upon the customer attending and completing training. Contracts with multiple performance obligations Some of our contracts with customers contain multiple performance obligations. For these contracts, we account for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. Standalone selling prices of our solutions and services are typically estimated based on observable transactions when the solutions or services are sold on a standalone basis. Costs of obtaining contracts, contract assets and deferred revenue We pay sales commissions at the time contracts with customers are signed or shortly thereafter, depending on the size and duration of the sales contract. Sales commissions and related fringe benefits earned by our sales force are considered incremental and recoverable costs of obtaining a contract with a customer. These costs are deferred and then amortized in a manner that aligns with the expected period of benefit, which we have determined to be five years. We determined the period of benefit by taking into consideration our customer contracts, including renewals, retention, our technology and other factors. We do not generally pay commissions for contract renewals. The related amortization expense is included in sales, marketing and customer success expense in our consolidated statements of comprehensive income. Amounts recognized as revenue in excess of amounts billed are recorded as contract assets within prepaid expenses and other current assets on our consolidated balance sheets. To the extent that our customers are billed for our solutions and services in advance of us satisfying the related performance obligations, we record such amounts in deferred revenue. Recently issued accounting pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) |
Business Combinations
Business Combinations | 6 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Business Combinations | 3. Business Combinations Reeher acquisition On April 30, 2018 , we acquired all of the outstanding equity securities, including all voting equity interests, of Reeher LLC, a Minnesota limited liability company (“Reeher”), pursuant to a securities purchase agreement. The acquisition expands our fundraising performance management capabilities and is intended to drive more effective fundraising and greater social good outcomes for our customers. We acquired the equity securities for an aggregate purchase price of $41.3 million in cash, subject to certain adjustments set forth in the securities purchase agreement. The purchase price and related expenses were funded primarily through borrowings under the 2017 Credit Facility (as defined below). As a result of the acquisition, Reeher has become a wholly-owned subsidiary of ours. The operating results of Reeher have been included in our consolidated financial statements from the date of acquisition. During the three and six months ended June 30, 2018 , we incurred insignificant acquisition-related expenses associated with the acquisition, which were recorded in general and administrative expense. The fair values assigned to the assets acquired and liabilities assumed in the table below are based on our best estimates and assumptions as of the reporting date and are considered preliminary pending finalization. The estimates and assumptions are subject to change as we obtain additional information during the measurement period, which may be up to one year from the acquisition date. The assets and liabilities, pending finalization, include the valuation of intangible assets as well as the assumed deferred revenue and deferred income tax balances. (in thousands) Purchase price allocation Net working capital, excluding deferred revenue $ 1,683 Property and equipment 755 Identifiable intangible assets 27,055 Deferred tax asset 713 Deferred revenue (2,700 ) Goodwill 13,827 Total purchase price $ 41,333 The estimated fair value of accounts receivable acquired approximates the contractual value of $1.1 million and $11.8 million of the goodwill arising in the acquisition is deductible for income tax purposes. The estimated goodwill recognized is attributable primarily to the opportunities for expected synergies from combining the operations and assembled workforce of Reeher. The Reeher acquisition resulted in the identification of the following identifiable intangible assets: Intangible assets acquired Weighted average amortization period Reeher (in thousands) (in years) Acquired technology $ 18,900 11 Customer relationships 7,000 10 In-process research and development 600 Indefinite Marketing assets 480 3 Non-compete agreements 75 2 Total intangible assets $ 27,055 11 The estimated fair values of the intangible assets were based on variations of the income approach, which estimates fair value based upon the present value of cash flows that the assets are expected to generate, and which included the relief-from-royalty method, incremental cash flow method, including the comparative (with and without) method and multi-period excess earnings method, depending on the intangible asset being valued. The method of amortization of identifiable finite-lived intangible assets is based on the expected pattern in which the estimated economic benefits of the respective assets are consumed or otherwise used up. Customer relationships and acquired technology are being amortized on an accelerated basis. Marketing assets and non-compete agreements are being amortized on a straight-line basis. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | 4. Goodwill The change in goodwill during the six months ended June 30, 2018 , consisted of the following: (dollars in thousands) Total Balance at December 31, 2017 $ 530,249 Additions related to current year business combinations 18,417 Adjustments related to prior year business combinations (141 ) Effect of foreign currency translation (1,213 ) Balance at June 30, 2018 $ 547,312 |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 5. Earnings Per Share We compute basic earnings per share by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares and dilutive potential common shares outstanding during the period. Diluted earnings per share reflect the assumed exercise, settlement and vesting of all dilutive securities using the “treasury stock method” except when the effect is anti-dilutive. Potentially dilutive securities consist of shares issuable upon the exercise of stock options, settlement of stock appreciation rights and vesting of restricted stock awards and units. The following table sets forth the computation of basic and diluted earnings per share: Three months ended Six months ended (dollars in thousands, except per share amounts) 2018 2017 2018 2017 Numerator: Net income $ 6,592 $ 11,029 $ 24,343 $ 24,171 Denominator: Weighted average common shares 47,222,657 46,662,481 47,121,692 46,584,263 Add effect of dilutive securities: Stock-based awards 830,437 1,028,859 908,855 1,002,630 Weighted average common shares assuming dilution 48,053,094 47,691,340 48,030,547 47,586,893 Earnings per share: Basic $ 0.14 $ 0.24 $ 0.52 $ 0.52 Diluted $ 0.14 $ 0.23 $ 0.51 $ 0.51 Anti-dilutive shares excluded from calculations of diluted earnings per share — — 37 5,515 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 6. Fair Value Measurements We use a three-tier fair value hierarchy to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows: • Level 1 - Quoted prices for identical assets or liabilities in active markets; • Level 2 - Quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and • Level 3 - Valuations derived from valuation techniques in which one or more significant inputs are unobservable. Recurring fair value measurements Financial assets and liabilities measured at fair value on a recurring basis consisted of the following, as of the dates indicated below: Fair value measurement using (dollars in thousands) Level 1 Level 2 Level 3 Total Fair value as of June 30, 2018 Financial assets: Derivative instruments $ — $ 3,789 $ — $ 3,789 Total financial assets $ — $ 3,789 $ — $ 3,789 Fair value as of December 31, 2017 Financial assets: Derivative instruments $ — $ 1,283 $ — $ 1,283 Total financial assets $ — $ 1,283 $ — $ 1,283 Our derivative instruments within the scope of ASC 815, Derivatives and Hedging , are required to be recorded at fair value. Our derivative instruments that are recorded at fair value include interest rate swaps. The fair value of our interest rate swaps was based on model-driven valuations using LIBOR rates, which are observable at commonly quoted intervals. Accordingly, our interest rate swaps are classified within Level 2 of the fair value hierarchy. We believe the carrying amounts of our cash and cash equivalents, restricted cash due to customers, accounts receivable, trade accounts payable, accrued expenses and other current liabilities and due to customers approximate their fair values at June 30, 2018 and December 31, 2017 , due to the immediate or short-term maturity of these instruments. We believe the carrying amount of our debt approximates its fair value at June 30, 2018 and December 31, 2017 , as the debt bears interest rates that approximate market value. As LIBOR rates are observable at commonly quoted intervals, our debt is classified within Level 2 of the fair value hierarchy. We did not transfer any assets or liabilities among the levels within the fair value hierarchy during the six months ended June 30, 2018 . Additionally, we did not hold any Level 3 assets or liabilities during the six months ended June 30, 2018 . Non-recurring fair value measurements Assets and liabilities that are measured at fair value on a non-recurring basis include intangible assets and goodwill, which are recognized at fair value during the period in which an acquisition is completed, from updated estimates and assumptions during the measurement period, or when they are considered to be impaired. These non-recurring fair value measurements, primarily for intangible assets acquired, are based on Level 3 unobservable inputs. In the event of an impairment, we determine the fair value of the goodwill and intangible assets using a discounted cash flow approach, which contains significant unobservable inputs and, therefore, is considered a Level 3 fair value measurement. The unobservable inputs in the analysis generally include future cash flow projections and a discount rate. There were no non-recurring fair value adjustments to intangible assets and goodwill during the six months ended June 30, 2018 , except for an insignificant business combination accounting adjustment to the initial fair value estimates of the assets acquired and liabilities assumed at the acquisition date from updated information obtained during the measurement period. See Note 4 |
Consolidated Financial Statemen
Consolidated Financial Statement Details | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidated Financial Statement Details | 7. Consolidated Financial Statement Details Prepaid expenses and other assets (dollars in thousands) June 30, December 31, Costs of obtaining contracts (1) $ 81,631 $ 77,312 Prepaid software maintenance and subscriptions 23,856 17,402 Taxes, prepaid and receivable 14,531 10,548 Derivative instruments 3,789 1,283 Contract assets 3,933 3,136 Security deposits 2,741 2,305 Other assets 9,424 7,230 Total prepaid expenses and other assets 139,905 119,216 Less: Long-term portion 64,089 57,238 Prepaid expenses and other current assets $ 75,816 $ 61,978 (1) Amortization expense from costs of obtaining contracts was $17.6 million for the six months ended June 30, 2018 . Accrued expenses and other liabilities (dollars in thousands) June 30, December 31, Accrued bonuses $ 11,134 $ 16,743 Accrued commissions and salaries 8,917 6,943 Lease incentive obligations 4,186 4,635 Customer credit balances 3,413 4,652 Deferred rent liabilities 4,678 4,548 Taxes payable 3,270 5,517 Unrecognized tax benefit 3,112 1,972 Accrued vacation costs 2,366 2,458 Accrued health care costs 2,885 2,615 Other liabilities 9,695 9,948 Total accrued expenses and other liabilities 53,656 60,031 Less: Long-term portion 7,474 5,632 Accrued expenses and other current liabilities $ 46,182 $ 54,399 Other income, net Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 Interest income $ 277 $ 210 $ 669 $ 378 Gain on derivative instrument — 475 — 475 Loss on debt extinguishment — (162 ) — (162 ) Other income (expense), net 69 304 (163 ) 422 Other income, net $ 346 $ 827 $ 506 $ 1,113 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt | 8. Debt The following table summarizes our debt balances and the related weighted average effective interest rates, which includes the effect of interest rate swap agreements. Debt balance at Weighted average effective interest rate at (dollars in thousands) June 30, December 31, June 30, December 31, Credit facility: Revolving credit loans $ 188,100 $ 143,000 3.58 % 2.84 % Term loans 292,500 296,250 3.30 % 2.64 % Other debt 1,076 1,076 4.50 % 4.50 % Total debt 481,676 440,326 3.41 % 2.71 % Less: Unamortized discount and debt issuance costs 1,864 2,102 Less: Debt, current portion 8,576 8,576 3.49 % 3.03 % Debt, net of current portion $ 471,236 $ 429,648 3.41 % 2.71 % In June 2017 , we entered into a five-year $700.0 million senior credit facility (the " 2017 Credit Facility "). As of June 30, 2018 , the required annual maturities related to the 2017 Credit Facility and other debt were as follows: Years ending December 31, (dollars in thousands) Annual maturities 2018 - remaining $ 4,826 2019 7,500 2020 7,500 2021 7,500 2022 454,350 Thereafter — Total required maturities $ 481,676 |
Derivative Instruments
Derivative Instruments | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives Instruments | 9. Derivative Instruments Cash flow hedges We generally use derivative instruments to manage our variable interest rate risk. In July 2017 , we entered into an interest rate swap agreement (the " July 2017 Swap Agreement"), which effectively converts portions of our variable rate debt under our credit facility to a fixed rate for the term of the July 2017 Swap Agreement. The notional value of the July 2017 Swap Agreement was $150.0 million with an effective date beginning in July 2017 through July 2021 . We designated the July 2017 Swap Agreement as a cash flow hedge at the inception of the contract. In February 2018 , we entered into an additional interest rate swap agreement (the " February 2018 Swap Agreement"), which effectively converts portions of our variable rate debt under our credit facility to a fixed rate for the term of the February 2018 Swap Agreement. The notional value of the February 2018 Swap Agreement was $50.0 million with an effective date beginning in February 2018 through June 2021 . We designated the February 2018 Swap Agreement as a cash flow hedge at the inception of the contract. Undesignated contracts In June 2017 , we entered into a foreign currency option contract to hedge our exposure to currency fluctuations in connection with our acquisition of JustGiving because the purchase price was denominated in British Pounds. The notional value of the instrument was £100.0 million with an effective date beginning in June 2017 and maturing in September 2017 . We settled the foreign currency option contract in September 2017 . We did not designate the foreign currency option contract as a cash flow hedge for accounting purposes since it involved a business combination. As such, changes in the fair value of this derivative were recognized in earnings. The insignificant premium paid for this option is shown within cash flows from investing activities in our consolidated statements of cash flows. The fair values of our derivative instruments were as follows as of: Asset Derivatives Liability Derivatives (dollars in thousands) Balance sheet location June 30, December 31, Balance sheet location June 30, December 31, Derivative instruments designated as hedging instruments: Interest rate swaps, current portion Prepaid expenses and other current assets $ — $ 145 Accrued expenses and other current liabilities $ — $ — Interest rate swaps, long-term portion Other assets 3,789 1,138 Other liabilities — — Total derivative instruments designated as hedging instruments $ 3,789 $ 1,283 $ — $ — The effects of derivative instruments in cash flow hedging relationships were as follows: Gain (loss) recognized in accumulated other comprehensive loss as of Location of gain (loss) reclassified from accumulated other comprehensive loss into income Gain (loss) reclassified from accumulated other comprehensive loss into income (dollars in thousands) June 30, Three months ended Six months ended Interest rate swaps $ 3,789 Interest expense $ (60 ) $ (40 ) June 30, Three months ended Six months ended Interest rate swaps $ 336 Interest expense $ 15 $ (104 ) Our policy requires that derivatives used for hedging purposes be designated and effective as a hedge of the identified risk exposure at the inception of the contract. Accumulated other comprehensive income (loss) includes unrealized gains or losses from the change in fair value measurement of our derivative instruments each reporting period and the related income tax expense or benefit. Changes in the fair value measurements of the derivative instruments and the related income tax expense or benefit are reflected as adjustments to accumulated other comprehensive income (loss) until the actual hedged expense is incurred or until the hedge is terminated at which point the unrealized gain (loss) is reclassified from accumulated other comprehensive income (loss) to current earnings. The estimated accumulated other comprehensive income as of June 30, 2018 that is expected to be reclassified into earnings within the next twelve months is $0.7 million . There were no ineffective portions of our interest rate swap derivatives during the six months ended June 30, 2018 and 2017 . See Note 13 to these consolidated financial statements for a summary of the changes in accumulated other comprehensive income (loss) by component. We did not have any undesignated derivative instruments during 2018. The effects of undesignated derivative instruments during the three and six months ended June 30, 2017 were as follows: Location of gain (loss) Gain (loss) recognized in income (dollars in thousands) Three months ended Six months ended Foreign currency option contracts Other income (expense), net $ 475 $ 475 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 10. Commitments and Contingencies Leases Total rent expense was $5.0 million and $4.1 million for the three months ended June 30, 2018 and 2017, respectively, and $9.0 million and $8.1 million , respectively, for the six months ended June 30, 2018 and 2017 . Other commitments The term loans under the 2017 Credit Facility require periodic principal payments. The balance of the term loans and any amounts drawn on the revolving credit loans are due upon maturity of the 2017 Credit Facility in June 2022 . We have contractual obligations for third-party technology used in our solutions and for other services we purchase as part of our normal operations. In certain cases, these arrangements require a minimum annual purchase commitment by us. As of June 30, 2018 , the remaining aggregate minimum purchase commitment under these arrangements was approximately $48.2 million through 2023 . Solution and service indemnifications In the ordinary course of business, we provide certain indemnifications of varying scope to customers against claims of intellectual property infringement made by third parties arising from the use of our solutions or services. If we determine that it is probable that a loss has been incurred related to solution or service indemnifications, any such loss that could be reasonably estimated would be recognized. We have not identified any losses and, accordingly, we have not recorded a liability related to these indemnifications. Legal proceedings We are subject to legal proceedings and claims that arise in the ordinary course of business. We make a provision for a loss contingency when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed at least quarterly and adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular case. Unless otherwise specifically disclosed in this note, we have determined as of June 30, 2018 , that no provision for liability nor disclosure is required related to any claim against us because (a) there is not a reasonable possibility that a loss exceeding amounts already recognized (if any) may be incurred with respect to such claim; (b) a reasonably possible loss or range of loss cannot be estimated; or (c) such estimate is immaterial. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 11. Income Taxes Our income tax provision (benefit) and effective income tax rates, including the effects of period-specific events, were: Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 Income tax provision (benefit) $ 825 $ 3,105 $ (2,702 ) $ 1,145 Effective income tax rate 11.1 % 22.0 % (12.5 )% 4.5 % The decreases in our effective income tax rates during the three and six months ended June 30, 2018 , when compared to the same periods in 2017 , were primarily due to the impact of the discrete benefit to income tax expense relating to stock-based compensation items, calculated prior to the impact of the U.S. federal corporate tax rate change as a result of the Tax Act. This favorable impact was attributable to an increase in the market price for shares of our common stock, as reported by the Nasdaq Stock Market LLC ("Nasdaq"), as well as an increase in the number of stock awards that vested and were exercised. Most of our equity awards are granted during our first quarter and vest in subsequent years during the same quarter. This discrete benefit to income tax expense relating to stock-based compensation during the three and six months ended June 30, 2018 was reduced as a result of the decrease in the U.S. corporate tax rate. The decreases in our effective income tax rates during the three and six months ended June 30, 2018 , as compared to the same periods in 2017, were also attributable to the impact of the lower U.S. federal corporate tax rate on pre-tax income. In December 2017, the Tax Act was signed into law making significant changes to the Internal Revenue Code. Changes include, but are not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning after December 31, 2017, the transition of U.S. international taxation from a worldwide tax system to a territorial system, and a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017. On December 22, 2017, Staff Accounting Bulletin No. 118 (“SAB 118”) was issued to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Act. For the three and six months ended June 30, 2018 , the Company obtained additional information affecting the provisional amount calculated for the transition tax as of December 31, 2017; however, the Company determined that the transition tax is still insignificant. The Tax Act eliminates the exceptions for performance-based compensation and CFO compensation from the 162(m) calculation. A transition rule allows for the grandfathering of performance-based compensation pursuant to a written binding contract in effect as of November 2, 2017. While there is negative discretion inherent in our performance-based compensation plans, it is our position that the intent is for historic contracts to be written and binding. As a result, we have not adjusted the ending estimated deferred tax assets for the performance-based stock compensation or the bonus accrual in our 2018 tax provision. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | 12. Stock-based Compensation Stock-based compensation expense is allocated to cost of revenue and operating expenses on the consolidated statements of comprehensive income based on where the associated employee’s compensation is recorded. The following table summarizes stock-based compensation expense: Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 Included in cost of revenue: Cost of recurring $ 718 $ 443 $ 1,170 $ 823 Cost of one-time services and other 927 507 1,570 918 Total included in cost of revenue 1,645 950 2,740 1,741 Included in operating expenses: Sales, marketing and customer success 2,807 1,781 4,632 3,220 Research and development 2,448 2,067 4,584 3,784 General and administrative 6,961 6,037 12,997 11,384 Total included in operating expenses 12,216 9,885 22,213 18,388 Total stock-based compensation expense $ 13,861 $ 10,835 $ 24,953 $ 20,129 |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Stockholders' Equity | 13. Stockholders' Equity Dividends Our Board of Directors has adopted a dividend policy, which provides for the distribution to stockholders of a portion of cash generated by us that is in excess of operational needs and capital expenditures. The 2017 Credit Facility limits the amount of dividends payable and certain state laws restrict the amount of dividends distributed. In February 2018 , our Board of Directors approved an annual dividend rate of $0.48 per share to be made in quarterly payments. Dividend payments are not guaranteed and our Board of Directors may decide, in its absolute discretion, at any time and for any reason, not to declare and pay further dividends. The following table provides information with respect to quarterly dividends of $0.12 per share paid on common stock during the six months ended June 30, 2018 . Declaration Date Dividend per Share Record Date Payable Date February 6, 2018 $ 0.12 February 28 March 15 April 30, 2018 $ 0.12 May 25 June 15 On July 30, 2018 , our Board of Directors declared a third quarter dividend of $0.12 per share payable on September 14, 2018 to stockholders of record on August 28, 2018 . Changes in accumulated other comprehensive income (loss) by component The changes in accumulated other comprehensive income (loss) by component, consisted of the following: Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 Accumulated other comprehensive income (loss), beginning of period $ 7,041 $ (270 ) $ (642 ) $ (604 ) By component: Gains and losses on cash flow hedges: Accumulated other comprehensive income balance, beginning of period $ 2,022 $ 207 $ 776 $ 25 Other comprehensive income before reclassifications, net of tax effects of $(259), $(3), $(651) and $(74) 721 5 1,815 115 Amounts reclassified from accumulated other comprehensive loss to interest expense 60 (15 ) 40 104 Tax benefit included in provision for income taxes (16 ) 6 (11 ) (41 ) Total amounts reclassified from accumulated other comprehensive loss 44 (9 ) 29 63 Net current-period other comprehensive income (loss) 765 (4 ) 1,844 178 Reclassification upon early adoption of ASU 2018-02 $ — $ — 167 — Accumulated other comprehensive income balance, end of period $ 2,787 $ 203 $ 2,787 $ 203 Foreign currency translation adjustment: Accumulated other comprehensive income (loss) balance, beginning of period $ 5,019 $ (477 ) $ (1,418 ) $ (629 ) Translation adjustments (8,817 ) (349 ) (2,380 ) (197 ) Accumulated other comprehensive loss balance, end of period (3,798 ) (826 ) (3,798 ) (826 ) Accumulated other comprehensive loss, end of period $ (1,011 ) $ (623 ) $ (1,011 ) $ (623 ) |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | 14. Revenue Recognition The prior period financial information presented below has been adjusted to reflect our adoption of ASU 2014-09. Transaction price allocated to the remaining performance obligations As of June 30, 2018 , approximately $731 million of revenue is expected to be recognized from remaining performance obligations. We expect to recognize revenue on approximately 60% of these remaining performance obligations over the next 12 months, with the remainder recognized thereafter. We applied the practical expedient in ASC 606-10-50-14 and have excluded the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less (one-time services); and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed (payment services and usage). We also applied the practical expedient in ASC 606-10-65-1-(f)(3), whereby the transaction price allocated to the remaining performance obligations, or an explanation of when we expect to recognize that amount as revenue for all reporting periods presented before the date of the initial application, is not disclosed. Contract balances Our opening and closing balances of contract assets and deferred revenue were as follows: (in thousands) June 30, December 31, Contract assets $ 3,933 $ 3,136 Total deferred revenue 309,807 278,706 Contract assets increased during the six months ended June 30, 2018 primarily as a result of incremental revenue recognized in excess of amounts billed. The increase in deferred revenue during the six months ended June 30, 2018 was primarily due to new subscription sales of our cloud-based solutions and a seasonal increase in customer contract renewals. Historically, due to the timing of customer budget cycles, we have an increase in customer contract renewals in our second quarter as compared to our fourth quarter. The amount of revenue recognized during the six months ended June 30, 2018 that was included in the deferred revenue balance at the beginning of the period was approximately $217 million . The amount of revenue recognized during the six months ended June 30, 2018 from performance obligations satisfied in prior periods was insignificant . Disaggregation of revenue We sell our cloud-based solutions and related services in two primary geographical markets: to customers in the United States, and to customers located outside of the United States. The following table presents our revenue by geographic area based on the address of our customers: Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 United States $ 179,586 $ 172,515 $ 355,509 $ 341,409 Other countries 34,086 19,074 62,347 35,252 Total revenue $ 213,672 $ 191,589 $ 417,856 $ 376,661 The General Markets Group ("GMG"), the Enterprise Markets Group ("EMG"), and the International Markets Group ("IMG") comprise our go-to-market organizations. The following is a description of each market group: • The GMG focuses on sales to all K-12 private schools, faith-based and arts and cultural organizations, as well as emerging and mid-sized prospects in North America; • The EMG focuses on sales to all healthcare and higher education institutions, corporations and foundations, as well as large and/or strategic prospects in North America; and • The IMG focuses on sales to all prospects and customers outside of North America. The following table presents our revenue by market group: Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 GMG $ 96,212 $ 90,002 $ 190,877 $ 177,482 EMG 93,502 91,794 183,565 179,318 IMG 23,644 9,890 41,968 18,948 Other 314 (97 ) 1,446 913 Total revenue $ 213,672 $ 191,589 $ 417,856 $ 376,661 |
Restructuring
Restructuring | 6 Months Ended |
Jun. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | 15. Restructuring During 2017, in an effort to further our organizational objectives including, improved operating efficiency, customer outcomes and employee satisfaction, we initiated a multi-year plan to consolidate and relocate some of our existing offices to highly modern and more collaborative workspaces with short-term financial commitments. These workspaces are also more centrally located for our employees and closer to our customers and prospects. Restructuring costs incurred to date and expected to be incurred consist primarily of costs to terminate existing lease agreements, contractual lease payments, net of estimated sublease income, upon vacating space as part of the plan, as well as insignificant costs to relocate affected employees and write-off leasehold improvement assets that we will no longer use. We currently expect to incur before-tax restructuring costs associated with these activities of between $6.0 million and $8.0 million , with a significant portion of the remaining costs expected to be incurred through 2019 . We also expect to incur employee severance costs related to the plan; however, these costs cannot be reasonably estimated at this time. The following table summarizes our facilities optimization restructuring costs as of June 30, 2018 : Costs incurred during the three months ended Costs incurred during the six months ended Cumulative costs incurred as of (in thousands) June 30, 2018 By component: Contract termination costs $ 3,652 $ 4,423 $ 5,018 Other costs 36 76 275 Total $ 3,688 $ 4,499 $ 5,293 The change in our liability related to our facilities optimization restructuring during the three and six months ended June 30, 2018 , consisted of the following: Accrued at Increases for incurred costs Costs paid Accrued at (in thousands) December 31, 2017 June 30, 2018 By component: Contract termination costs $ 691 $ 4,423 $ (3,233 ) $ 1,881 Other costs — 76 (76 ) — Total $ 691 $ 4,499 $ (3,309 ) $ 1,881 |
Basis of Presentation (Policy)
Basis of Presentation (Policy) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Unaudited interim consolidated financial statements | Unaudited interim consolidated financial statements The accompanying interim consolidated financial statements have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission ("SEC") for interim financial reporting. These consolidated statements are unaudited and, in the opinion of management, include all adjustments (consisting of normal recurring adjustments and accruals) necessary to state fairly the consolidated balance sheets, consolidated statements of comprehensive income, consolidated statements of cash flows and consolidated statement of stockholders’ equity, for the periods presented in accordance with accounting principles generally accepted in the United States ("GAAP"). The consolidated balance sheet at December 31, 2017 , has been derived from the audited consolidated financial statements at that date. Operating results and cash flows for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2018 , or any other future period. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted in accordance with the rules and regulations for interim reporting of the SEC. These interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2017 , and other forms filed with the SEC from time to time. |
Basis of consolidation | Basis of consolidationThe consolidated financial statements include the accounts of Blackbaud, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. |
Recently adopted accounting pronouncements | Recently adopted accounting pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"), which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. ASU 2014-09 replaces most previous revenue recognition guidance in GAAP and requires the recognition of revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also provides guidance on the recognition of costs related to obtaining and fulfilling customer contracts. We adopted ASU 2014-09 as of January 1, 2018 utilizing the full retrospective method of transition, which requires that the standard be applied to all periods presented. The impact of adopting ASU 2014-09 on our total revenues for 2017 and 2016 was not material. The primary impacts of adopting ASU 2014-09 relate to the deferral of incremental commission and other costs of obtaining contracts with customers and the increase to the amortization period for those costs. Previously, we deferred only direct and incremental commission costs to obtain a contract and amortized those costs over the contract term, generally three years, as the revenue was recognized. Under the new standard, we defer all incremental commission and related fringe benefit costs to obtain a contract and amortize these costs in a manner that aligns with the expected period of benefit. We utilized the 'portfolio approach' practical expedient in ASC 606-10-10-4, which allows entities to apply the guidance to a portfolio of contracts with similar characteristics because the effects on the financial statements of this approach would not differ materially from applying the guidance to individual contracts. Using the 'portfolio approach' and taking into consideration our customer contracts, our technology and other factors, we determined the expected period of benefit to be five years. We do not generally pay commissions for contract renewals. Select adjusted unaudited financial statement information, which reflects our adoption of ASU 2014-09 is set forth below. Consolidated balance sheets: As of December 31, 2017 (dollars in thousands) As Reported Adjustments As Adjusted Accounts receivable, net of allowance $ 96,293 $ (614 ) $ 95,679 Prepaid expenses and other current assets $ 56,099 $ 5,879 $ 61,978 Other assets $ 24,083 $ 33,155 $ 57,238 Deferred revenue, current portion $ 276,456 $ (1,393 ) $ 275,063 Deferred tax liability $ 37,597 $ 10,426 $ 48,023 Retained earnings $ 195,649 $ 29,380 $ 225,029 Consolidated statements of comprehensive income: Three months ended June 30, 2017 Six months ended June 30, 2017 (dollars in thousands, except per share amounts) As Reported (1) Adjustments As Adjusted As Reported (1) Adjustments As Adjusted Revenue Recurring $ 158,169 $ 8,220 $ 166,389 $ 310,129 $ 16,307 $ 326,436 One-time services and other 34,026 (8,826 ) 25,200 65,687 (15,462 ) 50,225 Total revenue $ 192,195 $ (606 ) $ 191,589 $ 375,816 $ 845 $ 376,661 Cost of Revenue Recurring $ 63,236 $ 2,942 $ 66,178 $ 124,144 $ 5,909 $ 130,053 One-time services and other 23,759 (2,942 ) 20,817 48,333 (5,909 ) 42,424 Total cost of revenue $ 86,995 $ — $ 86,995 $ 172,477 $ — $ 172,477 Operating expenses Sales, marketing and customer success $ 42,961 $ (381 ) $ 42,580 $ 85,201 $ (1,624 ) $ 83,577 Net income $ 11,165 $ (136 ) $ 11,029 $ 22,676 $ 1,495 $ 24,171 Basic earnings per share $ 0.24 $ — $ 0.24 $ 0.49 $ 0.03 $ 0.52 Diluted earnings per share $ 0.23 $ — $ 0.23 $ 0.48 $ 0.03 $ 0.51 (1) See the discussion of our reclassifications of previously reported revenue and costs of revenue above. Our adoption of ASU 2014-09 had no impact on our net cash provided by or used in operating, investing or financing activities for any of the periods reported. Except for the accounting policies for revenue recognition and deferred commissions (herein referred to as "costs of obtaining contracts") that were updated as a result of adopting ASU 2014-09, there have been no changes to our significant accounting policies described in the Annual Report on Form 10-K for the year ended December 31, 2017, filed with the SEC on February 20, 2018, that have had a material impact on our consolidated financial statements. In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income |
Revenue recognition | Revenue Recognition Our revenue is primarily generated from the following sources: (i) charging for the use of our software solutions in cloud-based and hosted environments; (ii) providing payment and transaction services; (iii) providing software maintenance and support services; and (iv) providing professional services, including implementation, consulting, training, analytic and other services. Revenues are recognized when control of these services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those services. We determine revenue recognition through the following steps: • Identification of the contract, or contracts, with a customer; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when, or as, we satisfy a performance obligation. Recurring Recurring revenue represents stand-ready performance obligations in which we are making our solutions or services available to our customers continuously over time or the value of the contract renews. Therefore, recurring revenue is generally recognized over time on a ratable basis over the contract term, beginning on the date that the solution or service is made available to the customer. Our recurring revenue contracts are generally for a term of three years at contract inception with one to three -year renewals thereafter, billed annually in advance and non-cancelable. Recurring revenue is comprised of fees for the use of our subscription-based software solutions, which includes providing access to cloud-based solutions, hosting services, online training programs, subscription-based analytic services, such as donor acquisitions and data enrichment, and payment services. Recurring revenue also includes fees from maintenance services for our on-premises solutions, services included in our renewable subscription contracts, subscription-based contracts for professional services and variable transaction revenue associated with the use of our solutions. Our payment services are offered with the assistance of third-party vendors. In general, when we are the principal in a transaction based on the factors identified in ASC 606-10-55-36 through 55-40, we record the revenue and related costs on a gross basis. Otherwise, we net the cost of revenue associated with the service against the gross revenue (amount billed to the customer) and record the net amount as revenue. For payment and transaction services, we have the right to invoice the customer in an amount that directly corresponds with the value to the customer of our performance to date. Therefore, we recognize revenue for these services over time based on the amount billable to the customer in accordance with the 'as invoiced' practical expedient in ASC 606-10-55-18. One-time services and other One-time services and other revenue primarily consists of fees for one-time consulting, analytic and onsite training services. We generally bill consulting services based on hourly rates plus reimbursable travel-related expenses. Fixed price consulting engagements are generally billed as milestones towards completion are reached. Revenue for all consulting services is recognized over time as the services are performed. We generally recognize analytic services revenue from donor prospect research engagements, the sale of lists of potential donors, data enrichment engagements and benchmarking studies at a point in time (upon delivery). In certain cases, we sell training at a fixed rate for each specific class at a per attendee price or at a packaged price for several attendees, and recognize the related revenue upon the customer attending and completing training. Contracts with multiple performance obligations |
Sales commissions | We pay sales commissions at the time contracts with customers are signed or shortly thereafter, depending on the size and duration of the sales contract. Sales commissions and related fringe benefits earned by our sales force are considered incremental and recoverable costs of obtaining a contract with a customer. These costs are deferred and then amortized in a manner that aligns with the expected period of benefit, which we have determined to be five |
Deferred revenue | To the extent that our customers are billed for our solutions and services in advance of us satisfying the related performance obligations, we record such amounts in deferred revenue. |
Recently issued accounting pronouncements | Recently issued accounting pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) |
Legal proceedings | Legal proceedingsWe are subject to legal proceedings and claims that arise in the ordinary course of business. We make a provision for a loss contingency when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed at least quarterly and adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular case. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Adoption of New Standard Impact on Previously Reported Results | Select adjusted unaudited financial statement information, which reflects our adoption of ASU 2014-09 is set forth below. Consolidated balance sheets: As of December 31, 2017 (dollars in thousands) As Reported Adjustments As Adjusted Accounts receivable, net of allowance $ 96,293 $ (614 ) $ 95,679 Prepaid expenses and other current assets $ 56,099 $ 5,879 $ 61,978 Other assets $ 24,083 $ 33,155 $ 57,238 Deferred revenue, current portion $ 276,456 $ (1,393 ) $ 275,063 Deferred tax liability $ 37,597 $ 10,426 $ 48,023 Retained earnings $ 195,649 $ 29,380 $ 225,029 Consolidated statements of comprehensive income: Three months ended June 30, 2017 Six months ended June 30, 2017 (dollars in thousands, except per share amounts) As Reported (1) Adjustments As Adjusted As Reported (1) Adjustments As Adjusted Revenue Recurring $ 158,169 $ 8,220 $ 166,389 $ 310,129 $ 16,307 $ 326,436 One-time services and other 34,026 (8,826 ) 25,200 65,687 (15,462 ) 50,225 Total revenue $ 192,195 $ (606 ) $ 191,589 $ 375,816 $ 845 $ 376,661 Cost of Revenue Recurring $ 63,236 $ 2,942 $ 66,178 $ 124,144 $ 5,909 $ 130,053 One-time services and other 23,759 (2,942 ) 20,817 48,333 (5,909 ) 42,424 Total cost of revenue $ 86,995 $ — $ 86,995 $ 172,477 $ — $ 172,477 Operating expenses Sales, marketing and customer success $ 42,961 $ (381 ) $ 42,580 $ 85,201 $ (1,624 ) $ 83,577 Net income $ 11,165 $ (136 ) $ 11,029 $ 22,676 $ 1,495 $ 24,171 Basic earnings per share $ 0.24 $ — $ 0.24 $ 0.49 $ 0.03 $ 0.52 Diluted earnings per share $ 0.23 $ — $ 0.23 $ 0.48 $ 0.03 $ 0.51 |
Business Combinations (Tables)
Business Combinations (Tables) - Reeher [Member] | 6 Months Ended |
Jun. 30, 2018 | |
Business Acquisition [Line Items] | |
Purchase Price Allocation | The fair values assigned to the assets acquired and liabilities assumed in the table below are based on our best estimates and assumptions as of the reporting date and are considered preliminary pending finalization. The estimates and assumptions are subject to change as we obtain additional information during the measurement period, which may be up to one year from the acquisition date. The assets and liabilities, pending finalization, include the valuation of intangible assets as well as the assumed deferred revenue and deferred income tax balances. (in thousands) Purchase price allocation Net working capital, excluding deferred revenue $ 1,683 Property and equipment 755 Identifiable intangible assets 27,055 Deferred tax asset 713 Deferred revenue (2,700 ) Goodwill 13,827 Total purchase price $ 41,333 |
Acquired Intangible Assets | The Reeher acquisition resulted in the identification of the following identifiable intangible assets: Intangible assets acquired Weighted average amortization period Reeher (in thousands) (in years) Acquired technology $ 18,900 11 Customer relationships 7,000 10 In-process research and development 600 Indefinite Marketing assets 480 3 Non-compete agreements 75 2 Total intangible assets $ 27,055 11 |
Goodwill and Other Intangible26
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Change in Goodwill | The change in goodwill during the six months ended June 30, 2018 , consisted of the following: (dollars in thousands) Total Balance at December 31, 2017 $ 530,249 Additions related to current year business combinations 18,417 Adjustments related to prior year business combinations (141 ) Effect of foreign currency translation (1,213 ) Balance at June 30, 2018 $ 547,312 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share: Three months ended Six months ended (dollars in thousands, except per share amounts) 2018 2017 2018 2017 Numerator: Net income $ 6,592 $ 11,029 $ 24,343 $ 24,171 Denominator: Weighted average common shares 47,222,657 46,662,481 47,121,692 46,584,263 Add effect of dilutive securities: Stock-based awards 830,437 1,028,859 908,855 1,002,630 Weighted average common shares assuming dilution 48,053,094 47,691,340 48,030,547 47,586,893 Earnings per share: Basic $ 0.14 $ 0.24 $ 0.52 $ 0.52 Diluted $ 0.14 $ 0.23 $ 0.51 $ 0.51 Anti-dilutive shares excluded from calculations of diluted earnings per share — — 37 5,515 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Financial assets and liabilities measured at fair value on a recurring basis consisted of the following, as of the dates indicated below: Fair value measurement using (dollars in thousands) Level 1 Level 2 Level 3 Total Fair value as of June 30, 2018 Financial assets: Derivative instruments $ — $ 3,789 $ — $ 3,789 Total financial assets $ — $ 3,789 $ — $ 3,789 Fair value as of December 31, 2017 Financial assets: Derivative instruments $ — $ 1,283 $ — $ 1,283 Total financial assets $ — $ 1,283 $ — $ 1,283 |
Consolidated Financial Statem29
Consolidated Financial Statement Details (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Components of Prepaid Expenses and Other Assets | Prepaid expenses and other assets (dollars in thousands) June 30, December 31, Costs of obtaining contracts (1) $ 81,631 $ 77,312 Prepaid software maintenance and subscriptions 23,856 17,402 Taxes, prepaid and receivable 14,531 10,548 Derivative instruments 3,789 1,283 Contract assets 3,933 3,136 Security deposits 2,741 2,305 Other assets 9,424 7,230 Total prepaid expenses and other assets 139,905 119,216 Less: Long-term portion 64,089 57,238 Prepaid expenses and other current assets $ 75,816 $ 61,978 |
Components of Accrued Expenses and Other Liabilities | Accrued expenses and other liabilities (dollars in thousands) June 30, December 31, Accrued bonuses $ 11,134 $ 16,743 Accrued commissions and salaries 8,917 6,943 Lease incentive obligations 4,186 4,635 Customer credit balances 3,413 4,652 Deferred rent liabilities 4,678 4,548 Taxes payable 3,270 5,517 Unrecognized tax benefit 3,112 1,972 Accrued vacation costs 2,366 2,458 Accrued health care costs 2,885 2,615 Other liabilities 9,695 9,948 Total accrued expenses and other liabilities 53,656 60,031 Less: Long-term portion 7,474 5,632 Accrued expenses and other current liabilities $ 46,182 $ 54,399 |
Components of Other Income and Expense | Other income, net Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 Interest income $ 277 $ 210 $ 669 $ 378 Gain on derivative instrument — 475 — 475 Loss on debt extinguishment — (162 ) — (162 ) Other income (expense), net 69 304 (163 ) 422 Other income, net $ 346 $ 827 $ 506 $ 1,113 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Summary of Debt | The following table summarizes our debt balances and the related weighted average effective interest rates, which includes the effect of interest rate swap agreements. Debt balance at Weighted average effective interest rate at (dollars in thousands) June 30, December 31, June 30, December 31, Credit facility: Revolving credit loans $ 188,100 $ 143,000 3.58 % 2.84 % Term loans 292,500 296,250 3.30 % 2.64 % Other debt 1,076 1,076 4.50 % 4.50 % Total debt 481,676 440,326 3.41 % 2.71 % Less: Unamortized discount and debt issuance costs 1,864 2,102 Less: Debt, current portion 8,576 8,576 3.49 % 3.03 % Debt, net of current portion $ 471,236 $ 429,648 3.41 % 2.71 % |
Annual Maturities Related to Credit Facility | As of June 30, 2018 , the required annual maturities related to the 2017 Credit Facility and other debt were as follows: Years ending December 31, (dollars in thousands) Annual maturities 2018 - remaining $ 4,826 2019 7,500 2020 7,500 2021 7,500 2022 454,350 Thereafter — Total required maturities $ 481,676 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair Values of Derivative Instruments | The fair values of our derivative instruments were as follows as of: Asset Derivatives Liability Derivatives (dollars in thousands) Balance sheet location June 30, December 31, Balance sheet location June 30, December 31, Derivative instruments designated as hedging instruments: Interest rate swaps, current portion Prepaid expenses and other current assets $ — $ 145 Accrued expenses and other current liabilities $ — $ — Interest rate swaps, long-term portion Other assets 3,789 1,138 Other liabilities — — Total derivative instruments designated as hedging instruments $ 3,789 $ 1,283 $ — $ — |
Effects of Derivative Instruments in Cash Flow Hedging Relationships | The effects of derivative instruments in cash flow hedging relationships were as follows: Gain (loss) recognized in accumulated other comprehensive loss as of Location of gain (loss) reclassified from accumulated other comprehensive loss into income Gain (loss) reclassified from accumulated other comprehensive loss into income (dollars in thousands) June 30, Three months ended Six months ended Interest rate swaps $ 3,789 Interest expense $ (60 ) $ (40 ) June 30, Three months ended Six months ended Interest rate swaps $ 336 Interest expense $ 15 $ (104 ) |
Effects of Undesignated Derivative Instruments | The effects of undesignated derivative instruments during the three and six months ended June 30, 2017 were as follows: Location of gain (loss) Gain (loss) recognized in income (dollars in thousands) Three months ended Six months ended Foreign currency option contracts Other income (expense), net $ 475 $ 475 |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rates | Our income tax provision (benefit) and effective income tax rates, including the effects of period-specific events, were: Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 Income tax provision (benefit) $ 825 $ 3,105 $ (2,702 ) $ 1,145 Effective income tax rate 11.1 % 22.0 % (12.5 )% 4.5 % |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Stock-Based Compensation Expense | The following table summarizes stock-based compensation expense: Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 Included in cost of revenue: Cost of recurring $ 718 $ 443 $ 1,170 $ 823 Cost of one-time services and other 927 507 1,570 918 Total included in cost of revenue 1,645 950 2,740 1,741 Included in operating expenses: Sales, marketing and customer success 2,807 1,781 4,632 3,220 Research and development 2,448 2,067 4,584 3,784 General and administrative 6,961 6,037 12,997 11,384 Total included in operating expenses 12,216 9,885 22,213 18,388 Total stock-based compensation expense $ 13,861 $ 10,835 $ 24,953 $ 20,129 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Changes in Accumulated Other Comprehensive Loss by Component | The changes in accumulated other comprehensive income (loss) by component, consisted of the following: Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 Accumulated other comprehensive income (loss), beginning of period $ 7,041 $ (270 ) $ (642 ) $ (604 ) By component: Gains and losses on cash flow hedges: Accumulated other comprehensive income balance, beginning of period $ 2,022 $ 207 $ 776 $ 25 Other comprehensive income before reclassifications, net of tax effects of $(259), $(3), $(651) and $(74) 721 5 1,815 115 Amounts reclassified from accumulated other comprehensive loss to interest expense 60 (15 ) 40 104 Tax benefit included in provision for income taxes (16 ) 6 (11 ) (41 ) Total amounts reclassified from accumulated other comprehensive loss 44 (9 ) 29 63 Net current-period other comprehensive income (loss) 765 (4 ) 1,844 178 Reclassification upon early adoption of ASU 2018-02 $ — $ — 167 — Accumulated other comprehensive income balance, end of period $ 2,787 $ 203 $ 2,787 $ 203 Foreign currency translation adjustment: Accumulated other comprehensive income (loss) balance, beginning of period $ 5,019 $ (477 ) $ (1,418 ) $ (629 ) Translation adjustments (8,817 ) (349 ) (2,380 ) (197 ) Accumulated other comprehensive loss balance, end of period (3,798 ) (826 ) (3,798 ) (826 ) Accumulated other comprehensive loss, end of period $ (1,011 ) $ (623 ) $ (1,011 ) $ (623 ) |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Contract Balances | Our opening and closing balances of contract assets and deferred revenue were as follows: (in thousands) June 30, December 31, Contract assets $ 3,933 $ 3,136 Total deferred revenue 309,807 278,706 |
Disaggregation of Revenue | The following table presents our revenue by market group: Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 GMG $ 96,212 $ 90,002 $ 190,877 $ 177,482 EMG 93,502 91,794 183,565 179,318 IMG 23,644 9,890 41,968 18,948 Other 314 (97 ) 1,446 913 Total revenue $ 213,672 $ 191,589 $ 417,856 $ 376,661 Three months ended Six months ended (dollars in thousands) 2018 2017 2018 2017 United States $ 179,586 $ 172,515 $ 355,509 $ 341,409 Other countries 34,086 19,074 62,347 35,252 Total revenue $ 213,672 $ 191,589 $ 417,856 $ 376,661 |
Restructuring (Tables)
Restructuring (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Costs | The following table summarizes our facilities optimization restructuring costs as of June 30, 2018 : Costs incurred during the three months ended Costs incurred during the six months ended Cumulative costs incurred as of (in thousands) June 30, 2018 By component: Contract termination costs $ 3,652 $ 4,423 $ 5,018 Other costs 36 76 275 Total $ 3,688 $ 4,499 $ 5,293 |
Schedule of Restructuring Reserve by Type of Cost | The change in our liability related to our facilities optimization restructuring during the three and six months ended June 30, 2018 , consisted of the following: Accrued at Increases for incurred costs Costs paid Accrued at (in thousands) December 31, 2017 June 30, 2018 By component: Contract termination costs $ 691 $ 4,423 $ (3,233 ) $ 1,881 Other costs — 76 (76 ) — Total $ 691 $ 4,499 $ (3,309 ) $ 1,881 |
Organization (Details)
Organization (Details) | Jun. 30, 2018Customers |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Approximate number of customers distributed across verticals | 40,000 |
Basis of Presentation Basis of
Basis of Presentation Basis of Presentation (Adoption of New Standard) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Consolidated balance sheets: | |||||
Accounts receivable, net of allowance | $ 130,509 | $ 130,509 | $ 95,679 | ||
Prepaid expenses and other current assets | 75,816 | 75,816 | 61,978 | ||
Other assets | 64,089 | 64,089 | 57,238 | ||
Deferred revenue, current portion | 306,365 | 306,365 | 275,063 | ||
Deferred tax liability | 48,055 | 48,055 | 48,023 | ||
Retained earnings | 237,609 | 237,609 | 225,029 | ||
Revenue | |||||
Recurring | 192,749 | $ 166,389 | 373,595 | $ 326,436 | |
One-time services and other | 20,923 | 25,200 | 44,261 | 50,225 | |
Total revenue | 213,672 | 191,589 | 417,856 | 376,661 | |
Cost of revenue | |||||
Cost of recurring | 76,350 | 66,178 | 145,429 | 130,053 | |
Cost of one-time services and other | 18,822 | 20,817 | 37,780 | 42,424 | |
Total cost of revenue | 95,172 | 86,995 | 183,209 | 172,477 | |
Operating expenses | |||||
Sales, marketing and customer success | 48,493 | 42,580 | 93,970 | 83,577 | |
Net income | $ 6,592 | $ 11,029 | $ 24,343 | $ 24,171 | |
Basic earnings per share | $ 0.14 | $ 0.24 | $ 0.52 | $ 0.52 | |
Diluted earnings per share | $ 0.14 | $ 0.23 | $ 0.51 | $ 0.51 | |
Scenario, previously reported [Member] | |||||
Consolidated balance sheets: | |||||
Accounts receivable, net of allowance | 96,293 | ||||
Prepaid expenses and other current assets | 56,099 | ||||
Other assets | 24,083 | ||||
Deferred revenue, current portion | 276,456 | ||||
Deferred tax liability | 37,597 | ||||
Retained earnings | 195,649 | ||||
Revenue | |||||
Recurring | $ 158,169 | $ 310,129 | |||
One-time services and other | 34,026 | 65,687 | |||
Total revenue | 192,195 | 375,816 | |||
Cost of revenue | |||||
Cost of recurring | 63,236 | 124,144 | |||
Cost of one-time services and other | 23,759 | 48,333 | |||
Total cost of revenue | 86,995 | 172,477 | |||
Operating expenses | |||||
Sales, marketing and customer success | 42,961 | 85,201 | |||
Net income | $ 11,165 | $ 22,676 | |||
Basic earnings per share | $ 0.24 | $ 0.49 | |||
Diluted earnings per share | $ 0.23 | $ 0.48 | |||
ASU 2014-09 adjustments [Member] | |||||
Consolidated balance sheets: | |||||
Accounts receivable, net of allowance | (614) | ||||
Prepaid expenses and other current assets | 5,879 | ||||
Other assets | 33,155 | ||||
Deferred revenue, current portion | (1,393) | ||||
Deferred tax liability | 10,426 | ||||
Retained earnings | $ 29,380 | ||||
Revenue | |||||
Recurring | $ 8,220 | $ 16,307 | |||
One-time services and other | (8,826) | (15,462) | |||
Total revenue | (606) | 845 | |||
Cost of revenue | |||||
Cost of recurring | 2,942 | 5,909 | |||
Cost of one-time services and other | (2,942) | (5,909) | |||
Total cost of revenue | 0 | 0 | |||
Operating expenses | |||||
Sales, marketing and customer success | (381) | (1,624) | |||
Net income | $ (136) | $ 1,495 | |||
Basic earnings per share | $ 0 | $ 0.03 | |||
Diluted earnings per share | $ 0 | $ 0.03 |
Basis of Presentation Basis o39
Basis of Presentation Basis of Presentation (Details) | 6 Months Ended |
Jun. 30, 2018 | |
Expected period of benefit, cost to obtain a contract | 5 years |
Contract term of recurring revenue contracts at contract inception (years) | 3 years |
Minimum [Member] | |
Contract term of recurring revenue contracts at renewal (years) | 1 year |
Maximum [Member] | |
Contract term of recurring revenue contracts at renewal (years) | 3 years |
Business Combinations (Details)
Business Combinations (Details) - Reeher [Member] $ in Millions | Apr. 30, 2018USD ($) |
Business Acquisition [Line Items] | |
Total cash consideration paid for the acquisition | $ 41.3 |
Estimated fair value of accounts receivable acquired | 1.1 |
Goodwill, tax deductible amount | $ 11.8 |
Business Combinations (Purchase
Business Combinations (Purchase Price Allocation) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Apr. 30, 2018 | Dec. 31, 2017 |
Business Acquisition [Line Items] | |||
Goodwill | $ 547,312 | $ 530,249 | |
Reeher [Member] | |||
Business Acquisition [Line Items] | |||
Net working capital, excluding deferred revenue | $ 1,683 | ||
Property and equipment | 755 | ||
Identifiable intangible assets | 27,055 | ||
Deferred tax asset | 713 | ||
Deferred revenue | (2,700) | ||
Goodwill | 13,827 | ||
Total purchase price | $ 41,333 |
Business Combinations (Acquired
Business Combinations (Acquired Intangible Assets) (Details) - Reeher [Member] $ in Thousands | Apr. 30, 2018USD ($) |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets acquired | $ 27,055 |
Weighted average amortization period (in years) | 11 years |
Acquired technology [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets acquired | $ 18,900 |
Weighted average amortization period (in years) | 11 years |
Customer relationships [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets acquired | $ 7,000 |
Weighted average amortization period (in years) | 10 years |
Marketing assets [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets acquired | $ 480 |
Weighted average amortization period (in years) | 3 years |
Non-compete agreements [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets acquired | $ 75 |
Weighted average amortization period (in years) | 2 years |
In-process research and development [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Indefinite-lived intangible assets acquired | $ 600 |
Goodwill and Other Intangible43
Goodwill and Other Intangible Assets (Change in Goodwill) (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 530,249 |
Effect of foreign currency translation | (1,213) |
Ending balance | 547,312 |
Seraphim [Member] | |
Goodwill [Roll Forward] | |
Additions related to current year business combination | 18,417 |
AcademicWorks [Member] | |
Goodwill [Roll Forward] | |
Adjustments related to prior year business combination | $ (141) |
Earnings Per Share (Computation
Earnings Per Share (Computation of Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 6,592 | $ 11,029 | $ 24,343 | $ 24,171 |
Weighted average common shares | 47,222,657 | 46,662,481 | 47,121,692 | 46,584,263 |
Stock-based awards | 830,437 | 1,028,859 | 908,855 | 1,002,630 |
Weighted average common shares assuming dilution | 48,053,094 | 47,691,340 | 48,030,547 | 47,586,893 |
Earnings (Loss) Per Share, Basic and Diluted [Abstract] | ||||
Basic earnings per share | $ 0.14 | $ 0.24 | $ 0.52 | $ 0.52 |
Diluted earnings per share | $ 0.14 | $ 0.23 | $ 0.51 | $ 0.51 |
Anti-dilutive shares excluded from calculations of diluted earnings per share | 0 | 0 | 37 | 5,515 |
Fair Value Measurements (Assets
Fair Value Measurements (Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) - Fair value measurements, recurring [Member] - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | $ 3,789 | $ 1,283 |
Total financial assets | 3,789 | 1,283 |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 0 | 0 |
Total financial assets | 0 | 0 |
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 3,789 | 1,283 |
Total financial assets | 3,789 | 1,283 |
Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 0 | 0 |
Total financial assets | $ 0 | $ 0 |
Consolidated Financial Statem46
Consolidated Financial Statement Details (Components of Prepaid Expenses and Other Assets) (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2018 | Dec. 31, 2017 | ||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Costs of obtaining contracts | [1] | $ 81,631 | $ 77,312 |
Prepaid software maintenance and subscriptions | 23,856 | 17,402 | |
Taxes, prepaid and receivable | 14,531 | 10,548 | |
Derivative instruments | 3,789 | 1,283 | |
Contract assets | 3,933 | 3,136 | |
Security deposits | 2,741 | 2,305 | |
Other assets | 9,424 | 7,230 | |
Total prepaid expenses and other assets | 139,905 | 119,216 | |
Less: Long-term portion | 64,089 | 57,238 | |
Prepaid expenses and other current assets | 75,816 | $ 61,978 | |
Amortization expense from costs of obtaining contracts | $ 17,600 | ||
[1] | Amortization expense from costs of obtaining contracts was $17.6 million for the six months ended June 30, 2018 |
Consolidated Financial Statem47
Consolidated Financial Statement Details (Components of Accrued Expenses and Other Liabilities) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accrued bonuses | $ 11,134 | $ 16,743 |
Accrued commissions and salaries | 8,917 | 6,943 |
Lease incentive obligations | 4,186 | 4,635 |
Customer credit balances | 3,413 | 4,652 |
Deferred rent liabilities | 4,678 | 4,548 |
Taxes payable | 3,270 | 5,517 |
Unrecognized tax benefit | 3,112 | 1,972 |
Accrued vacation costs | 2,366 | 2,458 |
Accrued health care costs | 2,885 | 2,615 |
Other liabilities | 9,695 | 9,948 |
Total accrued expenses and other liabilities | 53,656 | 60,031 |
Less: Long-term portion | 7,474 | 5,632 |
Accrued expenses and other current liabilities | $ 46,182 | $ 54,399 |
Consolidated Financial Statem48
Consolidated Financial Statement Details (Components of Other Expense, Net) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Interest income | $ 277 | $ 210 | $ 669 | $ 378 |
Gain on derivative instrument | 0 | 475 | 0 | 475 |
Loss on debt extinguishment | 0 | (162) | 0 | (162) |
Other income (expense), net | 69 | 304 | (163) | 422 |
Other income, net | $ 346 | $ 827 | $ 506 | $ 1,113 |
Debt (Details)
Debt (Details) $ in Millions | Jun. 02, 2017USD ($) |
Debt Disclosure [Abstract] | |
Credit facility, maximum borrowing capacity | $ 700 |
Debt (Summary of Debt) (Details
Debt (Summary of Debt) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Line of Credit Facility [Line Items] | ||
Debt, gross | $ 481,676 | $ 440,326 |
Less: Unamortized discount and debt issuance costs | 1,864 | 2,102 |
Less: Debt, current portion | 8,576 | 8,576 |
Debt, net of current portion | $ 471,236 | $ 429,648 |
Weighted average effective interest rate | 3.41% | 2.71% |
Revolving credit loans [Member] | ||
Line of Credit Facility [Line Items] | ||
Debt, gross | $ 188,100 | $ 143,000 |
Weighted average effective interest rate | 3.58% | 2.84% |
Term loans [Member] | ||
Line of Credit Facility [Line Items] | ||
Debt, gross | $ 292,500 | $ 296,250 |
Weighted average effective interest rate | 3.30% | 2.64% |
Short-term debt [Member] | ||
Line of Credit Facility [Line Items] | ||
Weighted average effective interest rate | 3.49% | 3.03% |
Long-term debt [Member] | ||
Line of Credit Facility [Line Items] | ||
Weighted average effective interest rate | 3.41% | 2.71% |
Loans payable [Member] | ||
Line of Credit Facility [Line Items] | ||
Other debt | $ 1,076 | $ 1,076 |
Weighted average effective interest rate | 4.50% | 4.50% |
Debt (Annual Maturities Related
Debt (Annual Maturities Related to Credit Facility) (Details) $ in Thousands | Jun. 30, 2018USD ($) |
Debt Disclosure [Abstract] | |
2018 - remaining | $ 4,826 |
2,019 | 7,500 |
2,020 | 7,500 |
2,021 | 7,500 |
2,022 | 454,350 |
Thereafter | 0 |
Total required maturities | $ 481,676 |
Derivative Instruments (Details
Derivative Instruments (Details) £ in Millions, $ in Millions | 6 Months Ended | ||||
Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Feb. 28, 2018USD ($) | Jul. 31, 2017USD ($) | Jun. 28, 2017GBP (£) | |
Derivative [Line Items] | |||||
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | $ 0.7 | ||||
Ineffective portion of interest rate swap(s) | $ 0 | $ 0 | |||
July 2017 Swap [Member] | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | $ 150 | ||||
February 2018 Swap [Member] | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | $ 50 | ||||
June 2017 Foreign Currency Option [Member] | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | £ | £ 100 |
Derivative Instruments (Fair Va
Derivative Instruments (Fair Value of Derivative Instruments) (Details) - Designated as hedging instrument [Member] - Interest rate swap [Member] - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | $ 3,789 | $ 1,283 |
Derivative liabilities, fair value | 0 | 0 |
Prepaid expenses and other current assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, current portion | 0 | 145 |
Accrued expenses and other current liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities, current portion | 0 | 0 |
Other assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, long-term portion | 3,789 | 1,138 |
Other liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities, long-term portion | $ 0 | $ 0 |
Derivative Instruments (Effects
Derivative Instruments (Effects of Derivative Instruments in Cash Flow Hedging Relationships) (Details) - Interest rate swap [Member] - Cash flow hedging [Member] - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in accumulated other comprehensive loss | $ 3,789 | $ 336 | ||
Interest expense [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) reclassified from accumulated other comprehensive loss into income | $ (60) | $ 15 | $ (40) | $ (104) |
Derivative Instruments (Effec55
Derivative Instruments (Effects of Undesignated Derivative Instruments) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2017 | Jun. 30, 2017 | |
Foreign currency option contracts [Member] | ||
Derivative [Line Items] | ||
Gain (loss) recognized in income | $ 475 | $ 475 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | ||||
Total rent expense | $ 5 | $ 4.1 | $ 9 | $ 8.1 |
Third-party technology [Member] | ||||
Long-term Purchase Commitment [Line Items] | ||||
Remaining aggregate minimum purchase commitment | $ 48.2 | $ 48.2 |
Income Taxes (Schedule of Effec
Income Taxes (Schedule of Effective Income Tax Rates) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Income tax provision (benefit) | $ 825 | $ 3,105 | $ (2,702) | $ 1,145 |
Effective income tax rate | 11.10% | 22.00% | (12.50%) | 4.50% |
Stock-Based Compensation (Summa
Stock-Based Compensation (Summary of Stock-Based Compensation Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated stock-based compensation expense | $ 13,861 | $ 10,835 | $ 24,953 | $ 20,129 |
Cost of recurring [Member] | ||||
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated stock-based compensation expense | 718 | 443 | 1,170 | 823 |
Cost of one-time services and other [Member] | ||||
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated stock-based compensation expense | 927 | 507 | 1,570 | 918 |
Total included in cost of revenue [Member] | ||||
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated stock-based compensation expense | 1,645 | 950 | 2,740 | 1,741 |
Sales, marketing and customer success [Member] | ||||
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated stock-based compensation expense | 2,807 | 1,781 | 4,632 | 3,220 |
Research and development [Member] | ||||
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated stock-based compensation expense | 2,448 | 2,067 | 4,584 | 3,784 |
General and administrative [Member] | ||||
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated stock-based compensation expense | 6,961 | 6,037 | 12,997 | 11,384 |
Total included in operating expenses [Member] | ||||
Employee Service Stock-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated stock-based compensation expense | $ 12,216 | $ 9,885 | $ 22,213 | $ 18,388 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - $ / shares | Jun. 15, 2018 | Mar. 15, 2018 | Feb. 28, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Sep. 14, 2018 |
Dividends Payable [Line Items] | ||||||||
Annual dividend per share approved (in dollars per share) | $ 0.48 | |||||||
Quarterly dividends paid per share (in dollars per share) | $ 0.12 | |||||||
Dividends paid per share (in dollars per share) | $ 0.12 | $ 0.12 | $ 0.12 | $ 0.12 | $ 0.24 | $ 0.24 | ||
Subsequent event [Member] | ||||||||
Dividends Payable [Line Items] | ||||||||
Dividends payable per share (in dollars per share) | $ 0.12 |
Stockholders' Equity (Changes i
Stockholders' Equity (Changes in Accumulated Other Comprehensive Loss by Component) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Accumulated Other Comprehensive Income [Roll Forward] | ||||
Accumulated other comprehensive (loss) income, beginning of period | $ 7,041 | $ (270) | $ (642) | $ (604) |
Reclassification upon early adoption of ASU 2018-02 | 0 | 0 | 167 | 0 |
Translation adjustments | (8,817) | (349) | (2,380) | (197) |
Accumulated other comprehensive income (loss), end of period | (1,011) | (623) | (1,011) | (623) |
Gains and losses on cash flow hedges [Member] | ||||
Accumulated Other Comprehensive Income [Roll Forward] | ||||
Accumulated other comprehensive (loss) income, beginning of period | 2,022 | 207 | 776 | 25 |
Other comprehensive (loss) income before reclassifications | 721 | 5 | 1,815 | 115 |
Amounts reclassified from accumulated other comprehensive loss to interest expense | 60 | (15) | 40 | 104 |
Tax benefit included in provision for income taxes | (16) | 6 | (11) | (41) |
Total amounts reclassified from accumulated other comprehensive loss | 44 | (9) | 29 | 63 |
Net current-period other comprehensive income (loss) | 765 | (4) | 1,844 | 178 |
Accumulated other comprehensive income (loss), end of period | 2,787 | 203 | 2,787 | 203 |
Unrealized losses, tax effects | (259) | (3) | (651) | (74) |
Foreign currency translation adjustment [Member] | ||||
Accumulated Other Comprehensive Income [Roll Forward] | ||||
Accumulated other comprehensive (loss) income, beginning of period | 5,019 | (477) | (1,418) | (629) |
Translation adjustments | (8,817) | (349) | (2,380) | (197) |
Accumulated other comprehensive income (loss), end of period | $ (3,798) | $ (826) | $ (3,798) | $ (826) |
Revenue Recognition (Details)
Revenue Recognition (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Revenue, remaining performance obligation | $ 731 |
Revenue, remaining performance obligation, percentage to be recognized over next 12 months | 60.00% |
Revenue recognized that was included in deferred revenue at beginning of period | $ 217 |
Revenue Recognition (Contract B
Revenue Recognition (Contract Balances) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 3,933 | $ 3,136 |
Total deferred revenue | $ 309,807 | $ 278,706 |
Revenue Recognition (Disaggrega
Revenue Recognition (Disaggregation of Revenue by Geography) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 213,672 | $ 191,589 | $ 417,856 | $ 376,661 |
United States [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 179,586 | 172,515 | 355,509 | 341,409 |
Non-US [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 34,086 | $ 19,074 | $ 62,347 | $ 35,252 |
Revenue Recognition (Disaggre64
Revenue Recognition (Disaggregation of Revenue by Market Group) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 213,672 | $ 191,589 | $ 417,856 | $ 376,661 |
GMG [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 96,212 | 90,002 | 190,877 | 177,482 |
EMG [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 93,502 | 91,794 | 183,565 | 179,318 |
IMG [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 23,644 | 9,890 | 41,968 | 18,948 |
Other [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 314 | $ (97) | $ 1,446 | $ 913 |
Restructuring (Details)
Restructuring (Details) $ in Millions | Jun. 30, 2018USD ($) |
Minimum [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring costs, expected | $ 6 |
Maximum [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring costs, expected | $ 8 |
Restructuring (Schedule of Rest
Restructuring (Schedule of Restructuring Costs) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2018USD ($) | Jun. 30, 2018USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||
Contract termination costs | $ 3,652 | $ 4,423 |
Other costs | 36 | 76 |
Total | 3,688 | 4,499 |
Cumulative costs incurred to date | 5,293 | 5,293 |
Contract termination costs [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Cumulative costs incurred to date | 5,018 | 5,018 |
Other costs [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Cumulative costs incurred to date | $ 275 | $ 275 |
Restructuring (Schedule of Re67
Restructuring (Schedule of Restructuring Reserve by Type of Cost) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring reserve, beginning of period | $ 691 | |||
Increases for incurred costs | $ 3,688 | $ 0 | 4,499 | $ 0 |
Costs paid | (3,309) | |||
Restructuring reserve, end of period | 1,881 | 1,881 | ||
Contract termination costs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring reserve, beginning of period | 691 | |||
Increases for incurred costs | 4,423 | |||
Costs paid | (3,233) | |||
Restructuring reserve, end of period | 1,881 | 1,881 | ||
Other costs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring reserve, beginning of period | 0 | |||
Increases for incurred costs | 76 | |||
Costs paid | (76) | |||
Restructuring reserve, end of period | $ 0 | $ 0 |
Uncategorized Items - a2018q210
Label | Element | Value |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents | $ 640,174,000 |