Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Jul. 20, 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 | RP | |
Entity Registrant Name | REALPAGE INC | |
Entity Central Index Key | 1,286,225 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 93,817,205 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 373,174 | $ 69,343 |
Restricted cash | 102,518 | 96,002 |
Accounts receivable, less allowance for doubtful accounts of $8,442 and $3,951 at June 30, 2018 and December 31, 2017, respectively | 112,484 | 124,505 |
Prepaid expenses | 15,493 | 12,107 |
Other current assets | 15,812 | 6,622 |
Total current assets | 619,481 | 308,579 |
Property, equipment, and software, net | 145,340 | 148,428 |
Goodwill | 918,785 | 751,052 |
Identified intangible assets, net | 276,983 | 252,337 |
Deferred tax assets, net | 42,607 | 44,887 |
Other assets | 20,710 | 11,010 |
Total assets | 2,023,906 | 1,516,293 |
Current liabilities: | ||
Accounts payable | 28,394 | 26,733 |
Accrued expenses and other current liabilities | 97,484 | 79,379 |
Current portion of deferred revenue | 111,238 | 116,622 |
Current portion of term loans | 16,133 | 14,116 |
Convertible notes, net | 286,908 | 0 |
Customer deposits held in restricted accounts | 102,512 | 96,057 |
Total current liabilities | 642,669 | 332,907 |
Deferred revenue | 5,181 | 5,538 |
Revolving facility | 0 | 50,000 |
Term loans, net | 295,382 | 303,261 |
Convertible notes, net | 0 | 281,199 |
Other long-term liabilities | 41,299 | 41,513 |
Total liabilities | 984,531 | 1,014,418 |
Commitments and contingencies (Note 9) | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value: 10,000,000 shares authorized and zero shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively | 0 | 0 |
Common stock, $0.001 par value: 250,000,000 and 125,000,000 shares authorized, 96,485,983 and 87,153,085 shares issued and 93,959,957 and 83,180,401 shares outstanding at June 30, 2018 and December 31, 2017, respectively | 96 | 87 |
Additional paid-in capital | 1,159,831 | 637,851 |
Treasury stock, at cost: 2,526,026 and 3,972,684 shares at June 30, 2018 and December 31, 2017, respectively | (67,360) | (61,260) |
Accumulated deficit | (53,445) | (75,046) |
Accumulated other comprehensive income | 253 | 243 |
Total stockholders’ equity | 1,039,375 | 501,875 |
Total liabilities and stockholders’ equity | $ 2,023,906 | $ 1,516,293 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 8,442 | $ 3,951 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 250,000,000 | 125,000,000 |
Common stock, shares issued (in shares) | 96,485,983 | 87,153,085 |
Common stock, shares outstanding (in shares) | 93,959,957 | 83,180,401 |
Treasury stock (in shares) | 2,526,026 | 3,972,684 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenue | ||||
Total revenue | $ 216,252 | $ 161,306 | $ 417,553 | $ 314,225 |
Gross profit | 130,511 | 93,762 | 255,152 | 183,639 |
Operating expenses: | ||||
Product development | 30,771 | 21,290 | 59,811 | 41,677 |
Sales and marketing | 54,488 | 39,235 | 104,729 | 74,382 |
General and administrative | 28,444 | 27,370 | 55,534 | 51,621 |
Total operating expenses | 113,703 | 87,895 | 220,074 | 167,680 |
Operating income | 16,808 | 5,867 | 35,078 | 15,959 |
Interest expense and other, net | (8,518) | (2,786) | (16,188) | (3,872) |
Income before income taxes | 8,290 | 3,081 | 18,890 | 12,087 |
Income tax benefit | (189) | (3,132) | (490) | (2,321) |
Net income | $ 8,479 | $ 6,213 | $ 19,380 | $ 14,408 |
Net income per share attributable to common stockholders: | ||||
Basic (in dollars per share) | $ 0.10 | $ 0.08 | $ 0.23 | $ 0.18 |
Diluted (in dollars per share) | $ 0.09 | $ 0.08 | $ 0.22 | $ 0.18 |
Weighted average shares used in computing net income per share attributable to common stockholders: | ||||
Basic (in shares) | 85,124 | 79,018 | 83,156 | 78,642 |
Diluted (in shares) | 90,005 | 81,925 | 87,332 | 81,644 |
On demand | ||||
Revenue | ||||
Total revenue | $ 206,945 | $ 154,727 | $ 400,245 | $ 300,940 |
Professional and other | ||||
Revenue | ||||
Total revenue | 9,307 | 6,579 | 17,308 | 13,285 |
Service | ||||
Revenue | ||||
Total revenue | 216,252 | 161,306 | 417,553 | 314,225 |
Cost of revenue | $ 85,741 | $ 67,544 | $ 162,401 | $ 130,586 |
Condensed Consolidated Stateme5
Condensed 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 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 8,479 | $ 6,213 | $ 19,380 | $ 14,408 |
(Loss) gain on interest rate swaps, net | (36) | (24) | 123 | 82 |
Foreign currency translation adjustment | 14 | 48 | (113) | (2) |
Comprehensive income | $ 8,457 | $ 6,237 | $ 19,390 | $ 14,488 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income | Accumulated Deficit | Treasury Stock |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Cumulative effect of adoption of ASU 2014-09 | $ 2,221 | $ 0 | $ 2,221 | |||
Beginning Balance (in shares) at Dec. 31, 2017 | 87,153 | 3,973 | ||||
Beginning Balance at Dec. 31, 2017 | 501,875 | $ 87 | 637,851 | $ 243 | (75,046) | $ (61,260) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Public offering of common stock, net of $16,399 of offering costs (in shares) | 8,050 | |||||
Public offering of common stock, net of $17,051 of offering costs | 441,799 | $ 8 | 441,791 | |||
Issuance of common stock for acquisition of ClickPay (in shares) | 683 | |||||
Issuance of common stock at closing for acquisition of ClickPay | 35,855 | $ 1 | 35,854 | |||
Shares held in escrow for acquisition of ClickPay (in shares) | 187 | |||||
Redemption of noncontrolling interest in connection with acquisition of ClickPay (in shares) | 395 | |||||
Redemption of noncontrolling interest in connection with acquisition of ClickPay | 20,756 | 20,756 | ||||
Stock option exercises (in shares) | 18 | 367 | ||||
Stock option exercises | 7,739 | $ 0 | 5,469 | $ 2,270 | ||
Issuance of restricted stock (in shares) | 0 | 1,533 | ||||
Issuance of restricted stock | 0 | $ 0 | (6,394) | $ 6,394 | ||
Treasury stock purchase, at cost (in shares) | (453) | |||||
Treasury stock purchases, at cost | (14,760) | 4 | $ (14,764) | |||
Stock-based expense | 24,500 | 24,500 | ||||
Interest rate swap agreements | 367 | 367 | ||||
Foreign currency translation | (113) | (113) | ||||
Reclassification of realized gain on cash flow hedge to earnings, net of tax | (244) | (244) | ||||
Net income | 19,380 | 19,380 | ||||
Ending Balance (in shares) at Jun. 30, 2018 | 96,486 | 2,526 | ||||
Ending Balance at Jun. 30, 2018 | $ 1,039,375 | $ 96 | $ 1,159,831 | $ 253 | $ (53,445) | $ (67,360) |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - Parenthetical $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Offering Costs | $ 17,051 |
Condensed Consolidated Stateme8
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash flows from operating activities: | ||
Net income | $ 19,380 | $ 14,408 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 48,389 | 29,533 |
Amortization of debt discount and issuance costs | 6,121 | 1,424 |
Deferred taxes | (2,973) | (3,088) |
Stock-based expense | 24,013 | 23,968 |
Loss on disposal and impairment of other long-lived assets | 1,098 | 87 |
Acquisition-related consideration | 1,124 | 1,024 |
Changes in assets and liabilities, net of assets acquired and liabilities assumed in business combinations: | ||
Accounts receivable | 6,815 | 6,430 |
Prepaid expenses and other current assets | (9,395) | (1,369) |
Other assets | (2,248) | (464) |
Accounts payable | 5,899 | 4,066 |
Accrued compensation, taxes, and benefits | (1,379) | (759) |
Deferred revenue | (2,034) | 3,607 |
Customer deposits | 5,142 | 15,389 |
Other current and long-term liabilities | 2,268 | 1,396 |
Net cash provided by operating activities | 102,220 | 95,652 |
Cash flows from investing activities: | ||
Purchases of property, equipment, and software | (22,493) | (27,129) |
Acquisition of businesses, net of cash and restricted cash acquired | (137,475) | (123,241) |
Purchase of other investment | (1,800) | 0 |
Net cash used in investing activities | (161,768) | (150,370) |
Cash flows from financing activities: | ||
Payments on term loans | (6,049) | (767) |
Proceeds from revolving credit facility | 140,000 | 0 |
Payments on revolving line of credit | (190,000) | 0 |
Proceeds from borrowings on convertible notes | 0 | 345,000 |
Purchase of convertible note hedges | 0 | (62,549) |
Proceeds from issuance of warrants | 0 | 31,499 |
Deferred financing costs | (1,139) | (10,755) |
Payments on capital lease obligations | (211) | (136) |
Payments of acquisition-related consideration | (7,371) | (7,185) |
Proceeds from public offering, net of underwriters’ discount and offering costs | 441,799 | 0 |
Proceeds from exercise of stock options | 7,739 | 13,151 |
Purchase of treasury stock related to stock-based compensation | (14,760) | (11,008) |
Net cash provided by financing activities | 370,008 | 297,250 |
Net increase in cash, cash equivalents and restricted cash | 310,460 | 242,532 |
Effect of exchange rate on cash | (113) | (2) |
Cash, cash equivalents and restricted cash: | ||
Cash, cash equivalents and restricted cash at beginning of period | 165,345 | 188,540 |
Cash, cash equivalents and restricted cash at end of period | 475,692 | 431,070 |
Supplemental cash flow information: | ||
Cash paid for interest | 9,200 | 1,976 |
Cash paid for income taxes, net of refunds | 722 | 1,157 |
Non-cash investing and financing activities: | ||
Fair value of stock consideration in connection with acquisition of ClickPay | 35,855 | 0 |
Redemption of noncontrolling interest in connection with acquisition of ClickPay | 20,756 | 0 |
Accrued property, equipment, and software | 1,101 | 951 |
Reconciliation of cash, cash equivalents and restricted cash: | ||
Cash and cash equivalents | 373,174 | |
Restricted cash | 102,518 | |
Total cash, cash equivalents and restricted cash shown in the Condensed Consolidated Statements of Cash flows | $ 165,345 | $ 188,540 |
The Company
The Company | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
The Company | The Company RealPage, Inc., a Delaware corporation (together with its subsidiaries, the “Company” or “we” or “us”), is a leading global provider of software and data analytics to the real estate industry. Our platform of data analytics and software solutions enables the rental real estate industry to manage property operations (such as marketing, pricing, screening, leasing, and accounting), identify opportunities through market intelligence, and obtain data-driven insight for better operational and financial decision-making. Our integrated, on demand platform provides a single point of access and a massive repository of real-time lease transaction data, including prospect, renter, and property data. By leveraging data as well as integrating and streamlining a wide range of complex processes and interactions among the rental real estate ecosystem (owners, managers, prospects, renters, service providers, and investors), our platform helps our clients improve financial and operational performance and prudently place and harvest capital. During May 2018 and as disclosed in our Form 10-Q for the quarter ended March 31, 2018, we were the subject of a targeted email phishing campaign that led to a business email compromise, pursuant to which an unauthorized party gained access to an external third party system used by a subsidiary that we acquired in 2017. The incident resulted in the diversion of approximately $6.2 million , net of recovered funds, intended for disbursement to three clients. We immediately restored all funds to the client accounts. We have since remediated the security weakness that gave rise to the incident, as well as implemented additional preventive and detective control procedures. We maintain insurance coverage to limit our losses related to criminal and network security events. At June 30, 2018 , we recognized a receivable of $6.2 million included in “Other current assets” in the accompanying Condensed Consolidated Balance Sheet for losses and related expenses arising from this incident that we believe are probable of recovery from our insurance carriers. For the three months ended June 30, 2018 , we also recognized a charge of $0.3 million included in “General and administrative” expenses in the accompanying Condensed Consolidated Statement of Operations for losses and related expenses that we do not expect to recover. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements and footnotes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. We believe that the disclosures made are appropriate and conform to those rules and regulations, and that the condensed or omitted information is not misleading. The unaudited Condensed Consolidated Financial Statements included herein reflect all adjustments (consisting of normal, recurring adjustments) which are, in the opinion of management, necessary to state fairly the results for the interim periods presented. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the interim periods presented are not necessarily indicative of the operating results to be expected for any subsequent interim period or for the fiscal year. These financial statements should be read in conjunction with the financial statements and the notes thereto included in our Annual Report on Form 10-K filed with the SEC on March 1, 2018 (“Form 10-K”). Segment and Geographic Information Our chief operating decision maker is our Chief Executive Officer, who reviews financial information presented on a company-wide basis. As a result, we determined that the Company has a single reporting segment and operating unit structure. Principally, all of our revenue for the three and six months ended June 30, 2018 and 2017 was earned in the United States. Net property, equipment, and software located in the United States amounted to $136.9 million and $140.0 million at June 30, 2018 and December 31, 2017 , respectively. Net property, equipment, and software located in our international subsidiaries amounted to $8.4 million at both June 30, 2018 and December 31, 2017 . Substantially all of the net property, equipment, and software held in our international subsidiaries was located in the Philippines, Spain, and India at both June 30, 2018 and December 31, 2017 . Concentrations of Credit Risk Our cash accounts are maintained at various financial institutions and may, from time to time, exceed federally insured limits. We have not experienced any losses in such accounts. Concentrations of credit risk with respect to accounts receivable result from substantially all of our clients being in the residential rental housing market. Our clients, however, are dispersed across different geographic areas. We do not require collateral from clients. We maintain an allowance for doubtful accounts for credits we offer our clients in certain instances and to reflect our best estimate of the amount of consideration we will ultimately receive based on relevant factors such as our historical experience, current contractual requirements, potential client buying patterns, age of the outstanding balance, and our clients’ ability to pay. No single client accounted for 10% or more of our revenue or accounts receivable for the three or six months ended June 30, 2018 or 2017 . Accounting Policies and Use of Estimate s The preparation of financial statements in conformity with GAAP requires our management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities, at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Significant estimates include the allowance for doubtful accounts; the useful lives of intangible assets and the recoverability or impairment of tangible and intangible asset values; fair value measurements; contingent commissions related to the sale of insurance products; valuation of net assets acquired and contingent consideration in connection with business combinations; revenue and deferred revenue and related reserves; stock-based expense; and our effective income tax rate and the recoverability of deferred tax assets, which are based upon our expectations of future taxable income and allowable deductions. Actual results could differ from these estimates. For greater detail regarding these accounting policies and estimates, refer to our Form 10-K. Cash and Cash Equivalents We consider all highly liquid investments with a maturity date, when purchased, of three months or less to be cash equivalents. Restricted Cash Restricted cash consists of cash collected from tenants that will be remitted primarily to our clients. Business Combinations We apply the guidance contained in ASC Topic 805, Business Combinations (“ASC 805”) in determining whether an acquisition transaction constitutes a business combination. ASC 805 defines a business as consisting of inputs and processes applied to those inputs that have the ability to create outputs. The acquisition transactions in Note 3 were determined to constitute business combinations and were accounted for under ASC 805. Purchase consideration includes assets transferred, liabilities assumed, and/or equity interests issued by us, all of which are measured at their fair value as of the date of acquisition. Our business combination transactions may be structured to include a combination of up-front, deferred and contingent payments. These payments may include a combination of cash and common stock. Deferred and contingent payments are made at specified dates subsequent to the date of acquisition. Deferred cash payments and stock issuances are included in the acquisition consideration based on their fair value as of the acquisition date. The fair value of these obligations is estimated based on the present value, as of the date of acquisition, of the anticipated future payments. The future payments are discounted using a rate that considers an estimate of the return expected by a market-participant and a measurement of the risk inherent in the cash flows, among other inputs. These deferred obligations are generally subject to adjustments specified in the underlying purchase agreement related to the seller’s indemnification obligations. Contingent cash payments are obligations to make future cash payments to the seller, the payment of which is contingent upon the achievement of stipulated operational or financial targets in the post-acquisition period. Contingent cash payments are included in the purchase consideration at their fair value as of the acquisition date. The fair value of these payments is estimated using a probability weighted discount model based on the achievement of the specified targets. The fair value of these liabilities is re-evaluated on a quarterly basis, and any change is reflected in the line “General and administrative” in the accompanying Condensed Consolidated Statements of Operations. These estimates are inherently uncertain and unpredictable. Unanticipated events and circumstances may occur that would affect the accuracy or validity of these estimates. The total purchase consideration is allocated to the assets acquired and liabilities assumed based on their estimated fair values. Any excess consideration is classified as goodwill. Acquired intangibles are recorded at their estimated fair value based on the income approach using market-based estimates. Acquired intangibles generally include developed product technologies, which are amortized over their useful life on a straight-line basis, and client relationships, which are amortized over their useful life proportionately to the expected discounted cash flows derived from the asset. When trade names acquired are not classified as indefinite-lived, they are amortized on a straight-line basis over their expected useful life. Acquisition costs are expensed as incurred and are included in the line “General and administrative” in the accompanying Condensed Consolidated Statements of Operations. We include the results of operations from acquired businesses in our Condensed Consolidated Financial Statements from the effective date of the acquisition. Derivative Financial Instruments We are exposed to interest rate risk related to our variable rate debt. We manage this risk through a program that includes the use of interest rate derivatives, the counterparties to which are major financial institutions. Our objective in using interest rate derivatives is to add stability to interest cost by reducing our exposure to interest rate movements. We do not use derivative instruments for trading or speculative purposes. Our interest rate derivatives are designated as cash flow hedges and are carried in the Condensed Consolidated Balance Sheets at their fair value. Unrealized gains and losses resulting from changes in the fair value of these instruments are classified as either effective or ineffective. The effective portion of such gains or losses is recorded as a component of accumulated other comprehensive income (“AOCI”), while the ineffective portion is recorded as a component of interest expense in the period of change. Amounts reported in AOCI related to interest rate derivatives are reclassified into interest expense as interest payments are made on our variable-rate debt. If an interest rate derivative agreement is terminated prior to its maturity, the amounts previously recorded in AOCI are recognized into earnings over the period that the forecasted transactions impact earnings. If the hedging relationship is discontinued because it is probable that the forecasted transactions will not occur according to our original strategy, any related amounts previously recorded in AOCI are recognized in earnings immediately. Accounts Receivable Accounts receivable primarily represent trade receivables from clients that are recorded at the invoice amount, net of an allowance for doubtful accounts and credits. For certain transactions, we have met the requirements to recognize revenue in advance of invoicing the client. In these instances, we record unbilled receivables for the amount that will be due from the client upon invoicing. We maintain an allowance for doubtful accounts for credits we offer our clients in certain instances and to reflect our best estimate of the amount of consideration to which we are entitled and that we will ultimately receive. In evaluating the sufficiency of the allowance for doubtful accounts, we consider relevant factors such as our historical experience, current contractual requirements, potential client buying patterns, age of the outstanding balance, and our clients’ ability to pay. Any change in the assumptions used in analyzing a specific account receivable might result in an additional allowance for doubtful accounts being recognized in the period in which the change occurs. A portion of our allowance is for services not yet rendered and is therefore classified as an offset to deferred revenue. Accounts receivable are written off upon determination of non-collectability following established Company policies. We incurred bad debt expense of $1.5 million and $0.8 million for the three months ended , and $2.1 million and $1.3 million for the six months ended June 30, 2018 and 2017 , respectively. Accounts receivable includes commissions due to us related to the sale of insurance products to individuals and commissions which are contingent based upon the activity in the underlying policies. Contingent commissions receivables are recorded at their estimated net realizable value, based on estimates and considerations which include, but are not limited to, the historical and projected loss rates incurred by the underlying policies. Deferred Revenue Deferred revenue primarily consists of billings issued or payments received for service obligations we have not yet completed. For several of our solutions, we invoice our clients in annual, monthly, or quarterly installments in advance of the commencement of the service period. Accordingly, the deferred revenue balance does not represent the total contract value of annual or multi-year, non-cancellable subscription agreements. Deferred revenue that will be recognized during the succeeding twelve-month period is recorded as current deferred revenue and the remaining portion is recorded as noncurrent. Revenue Recognition We derive our revenue from two primary sources: (1) on demand software solutions and (2) professional services and other goods and services. We recognize revenue as we satisfy one or more service obligations under the terms of a contract, generally as control of goods and services are transferred to our clients. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. We include estimates of variable consideration in revenue to the extent that it is probable that a significant reversal of cumulative revenue will not occur once the uncertainty is resolved. We determine revenue recognition through the following steps: • identification of the contract, or contracts, with a client; • 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. On Demand Revenue Our on demand revenue consists of license and subscription fees, transaction fees related to certain of our software-enabled value-added services, and commissions derived from our sales of certain risk mitigation services. We generally recognize revenue from subscription fees on a straight-line basis over the access period beginning on the date that we make our service available to the client. Our subscription agreements generally are non-cancellable, have an initial term of one year or longer and are billed either monthly or annually in advance. Recognition on subscription fees starts and is recorded when, or as, service obligations are satisfied. Non-refundable upfront fees billed at the initial order date that are not associated with an upfront service obligation are recognized as revenue on a straight-line basis over the period over which the client is expected to benefit, which we consider to be three years. We recognize revenue from transaction fees in the month the related services are performed based on the amount we have a right to invoice. As part of our resident services offerings, we offer risk mitigation services to our clients by acting as an insurance agent and derive commission revenue from the sale of insurance products to our clients’ residents. The commissions are based upon a percentage of the premium that our insurance company underwriting partners charge to the policyholder and are subject to forfeiture in instances where a policyholder cancels prior to the end of the policy. Our contracts with our underwriting partners also provide for contingent commissions to be paid to us in accordance with the agreements. Such commissions are variable in nature and based on a calculation that considers, on the policies sold by us, earned premiums less i) earned agent commissions; ii) a percent of premium retained by our underwriting partner; iii) incurred losses; and iv) profit retained by our underwriting partner during the time period. Our estimate of contingent commission revenue considers historical loss experience on the policies sold by us. If the policy is cancelled, our commissions are forfeited as a percent of the unearned premium. As a result, we recognize commissions related to these services as earned ratably over the policy term. Professional and Other Revenue Professional services and other revenues generally consist of the fees we receive for providing implementation and consulting services, submeter equipment and ongoing maintenance of our existing on premise licenses. Professional services are billed either on a fixed rate per hour (time) and materials basis or on a fixed price basis, and revenue is recognized over time as we perform the obligation. Professional services are typically sold bundled in a contract with other on demand solutions but may be sold separately. Professional service contracts sold separately generally have terms of one year or less. For bundled arrangements, where the Company accounts for individual services as a separate performance obligation, the transaction price is allocated between separate services in the bundle based on their relative standalone selling prices. Other revenues consist primarily of submeter equipment sales that include related installation services. Such sales are considered bundled, and revenue from these bundled sales is recognized in proportion to the number of fully installed units completed to date as compared to the total contracted number of units to be provided and installed. For all other equipment sales, we generally recognize revenue when control of the hardware has transferred to our client. Revenue recognized for on premise software sales generally consists of annual maintenance renewals on existing term or perpetual licenses, which is recognized ratably over the service period. Contracts with Multiple Performance Obligations The majority of the contracts we enter into with clients, including multiple contracts entered into at or near the same time with the same client, require us to provide one or more on demand software solutions, professional services and/or equipment. For these contracts, we account for individual performance obligations separately i) if they are distinct or ii) if the promised obligations represent a series of distinct services that are substantially the same and have the same pattern of transfer to the client. Once we determine the performance obligations, we determine the transaction price, which includes estimating the amount of variable consideration, if any, to be included in the transaction price. If the contract contains a single performance obligation, we allocate the entire transaction price to the single performance obligation. For contracts with multiple performance obligations, we allocate the transaction price to the separate performance obligations on a relative standalone selling price basis. The standalone selling prices of our services are typically estimated using a market assessment approach based on our overall pricing objectives taking into consideration market conditions and other factors including the number of solutions sold, client demographics, and the number and types of users within our contracts. Sales, value add, and other taxes we collect from clients and remit to governmental authorities are excluded from revenues. Reserves for Variable Consideration We recognize revenues from on demand and professional service sales at the net sales price (transaction price), which includes estimates of reserves we establish for credits we offer our clients in certain instances. These reserves are based on the amounts expected to be credited on the related sales and are classified as reductions of revenue and the related accounts receivable. Where appropriate, these estimates take into consideration relevant factors such as the Company’s historical experience, current contractual requirements, specific known market events and trends, and forecasted buying and payment patterns. These reserves reduce revenue to an amount that reflects the Company’s best estimates of the amount of consideration to which it is entitled and that it will ultimately receive based on the terms of the contract. The amount of variable consideration which is included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. If actual results in the future vary from the Company’s estimates, the Company will adjust these estimates, which will affect net revenue and earnings in the period such variances become known. Deferred Commissions Sales commissions, including sales-based incentive payments, earned by our direct sales force are considered incremental and recoverable costs of obtaining a contract with a client. These costs are deferred in “Other current assets” and “Other assets” and amortized into “Sales and marketing expense” on a straight line basis over a period of benefit that we have determined to be three years. We determined the period of benefit by taking into consideration our client contracts, our technology, historical pricing practices and other factors. We periodically review these capitalized costs for impairment. Fair Value Measurements Certain assets and liabilities are carried at fair value under GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Legal Contingencies We review the status of each legal matter and record a provision for a liability when we consider that it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We review these provisions quarterly and make adjustments where needed as additional information becomes available. If either or both of the criteria are not met, we assess whether there is at least a reasonable possibility that a loss, or additional losses beyond those already accrued, may be incurred. If there is a reasonable possibility that a material loss (or additional material loss in excess of any accrual) may be incurred, we disclose an estimate of the amount of loss or range of losses, either individually or in the aggregate, as appropriate, if such an estimate can be made, or disclose that an estimate of loss cannot be made. Recently Adopted Accounting Standards Accounting Standards Update 2014-09 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, as amended by certain supplementary ASU’s released in 2016, replaces all current GAAP guidance on this topic and eliminates all industry-specific guidance. The new revenue recognition standard requires the recognition of revenue when promised goods or services are transferred to clients in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 also includes Subtopic 340-40, Other Assets and Deferred Costs - Contracts with Customers , which requires the deferral of incremental costs of obtaining a contract with a client. Collectively, we refer to Topic 606 and Subtopic 340-40 as the “new revenue standard” or “ ASC 606 .” We adopted the requirements of the new revenue standard on January 1, 2018 using the modified retrospective method. We recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings at the beginning of 2018. Comparative information from prior year periods has not been restated and continues to be reported under the accounting standards in effect for those periods. The cumulative effects of the changes made to our condensed consolidated January 1, 2018 balance sheet for the adoption of the new revenue standard were as follows: Balance at December 31, 2017 Adjustments due to ASU 2014-09 Balance at (in thousands) Assets Accounts receivable, less allowance for doubtful accounts $ 124,505 $ (7,925 ) $ 116,580 Other current assets 6,622 2,771 9,393 Deferred tax assets, net 44,887 (780 ) 44,107 Other assets 11,010 4,459 15,469 Liabilities Current portion of deferred revenue 116,622 (3,696 ) 112,926 Stockholders’ Equity Accumulated deficit (75,046 ) 2,221 (72,825 ) Adoption of the new revenue standard resulted in changes to our accounting policies for revenue recognition, certain variable considerations, and commissions expense. The adoption of the new revenue standard did not have a significant effect on our revenue; however, it did have an impact on the timing of when we expense commission costs incurred to obtain a contract and the reserves we establish for variable consideration from credits or other pricing accommodations we provide our clients. We expect the effect of the new revenue standard to be immaterial to our revenue on an ongoing basis. The primary effect to our net income on an ongoing basis relates to the reserve for credit accommodations and deferral of incremental commission costs incurred to obtain new contracts. Under the new revenue standard, we accrue for credit accommodations in our reserve during the month of billing and credits reduce this reserve when issued. Further, we now initially defer commission costs and amortize these costs to expense over a period of benefit that we have determined to be three years. See Note 4 for additional required disclosures related to the impact of adopting the new revenue standard and our accounting for costs to obtain a contract . Accounting Standards Update 2016-18 In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows - Restricted Cash , which requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. This ASU must be adopted retrospectively. We adopted ASU 2016-18 effective January 1, 2018. As a result of our adoption, changes in customer deposits held in restricted accounts will result in an increase or reduction in our cash flows from operating activities. Under previous rules, such changes were largely offset by the corresponding change in restricted cash and had a minimal impact on our statement of cash flows. The prior period financial statements included in this filing have been adjusted to reflect the adoption of ASU 2016-18. The effects of those adjustments to the Condensed Consolidated Statements of Cash Flows have been summarized in the table below: Originally Reported Effect of Change As Adjusted (in thousands) Statement of Cash Flows for the six months ended June 30, 2017 Net cash provided by operating activities $ 80,464 $ 15,188 $ 95,652 Net cash used in investing activities (158,007 ) 7,637 (150,370 ) Cash, cash equivalents and restricted cash at end of period 324,591 106,479 431,070 Accounting Standards Update 2017-09 In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting , which provides clarification on when modification accounting should be used for changes to the terms or conditions of a share-based payment award. This ASU does not change the accounting for modifications but clarifies that modification accounting guidance should only be applied if there is a change to the fair value, vesting conditions, or award classification (as equity or liability) and would not be required if the changes are considered non-substantive. This new standard was effective for the Company on January 1, 2018. Adoption of ASU 2017-09 did not have a material impact on our consolidated financial statements. Accounting Standards Update 2017-01 In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business to assist entities with evaluating whether a set of transferred assets and activities (a "set") is a business . Under the new guidance, an entity first determines whether substantially all of the fair value of the set is concentrated in a single identifiable asset or a group of similar identifiable assets. If this threshold is met, the set is not a business. If the threshold is not met, the entity evaluates whether the set meets the requirements that a business include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. The provisions of this ASU became effective for the Company on January 1, 2018, and the adoption did not have a significant impact on our classification of businesses and complementary technologies acquired. Accounting Standards Update 2016-01 In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities and ASU 2018-03, Technical Corrections and Improvements to Financial Instruments - Overall (Subtopic 825-10) in February 2018, which provides clarification on certain guidance issued under ASU 2016-01. Among other things, ASU 2016-01 eliminates the cost method of accounting and requires that investments in equity securities that were previously accounted for under the cost method must now be measured at fair value, with changes in fair value recognized in net income. Equity instruments that do not have readily determinable fair values may be measured at cost less impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. This ASU became effective on January 1, 2018. The Company holds an investment which was accounted for under the cost method of accounting prior to January 1, 2018, which does not have a readily determinable fair value and has had no observable price change. Therefore, we continue to measure this investment at cost, less any impairment. The adoption of this standard did not have a material impact on our consolidated financial statements. Recently Issued Accounting Standards In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting , which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under this ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. ASU 2018-07 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted. The amendments in this ASU are to be applied through a cumulative-effect adjustment to retained earnings as of the first reporting period in which the ASU is effective. We are currently evaluating this ASU, but the adoption is not expected to have 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 , which provides companies the option to reclassify tax effects stranded in accumulated other comprehensive income as a result of the 2017 Tax Cuts and Jobs Act (“Tax Reform Act”) to retained earnings. ASU 2018-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within those fiscal years, and should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Reform Act is recognized. Early adoption is permitted. We are currently evaluating this ASU, but the adoption is not expected to have a material impact on our consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities , which expands an entity’s ability to apply hedge accounting for nonfinancial and financial risk components and allows for a simplified approach for fair value hedging of interest rate risk. Certain of the amendments in this ASU as they relate to cash flow hedges, eliminate the requirement to separately record hedge ineffectiveness currently in earnings. Instead, the entire change in the fair value of the hedging instrument is recorded in Other Comprehensive Income (“OCI”), and amounts deferred in OCI will be reclassified to earnings in the same income statement line item in which the earnings effect of the hedged item is reported. Additionally, this ASU simplifies the hedge documentation and effectiveness assessment requirements under the previous guidance. ASU 2017-12 is effective for annual reporting periods beginni |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Current Acquisition Activity ClickPay In April 2018, we entered into an acquisition agreement by which we acquired substantially all of the outstanding membership units of NovelPay, LLC (“NovelPay”), other than those owned by ClickPay Services, Inc. On the same day, we also entered into an agreement and plan of merger, by which we acquired all of the outstanding stock of ClickPay Services, Inc. (collectively with NovelPay, “ClickPay”). ClickPay provides an electronic payment platform servicing resident units across multiple segments of real estate, which offers integrated payment services to increase operational efficiencies for property owners and managers. The acquisition of ClickPay broadens our presence in the real estate industry, and solidifies the integration of our leasing platform with third-party property management systems. We acquired ClickPay for a purchase price of $216.9 million . The purchase price consisted of a cash payment of $138.8 million , net of cash acquired of $7.5 million , the issuance of 682,688 shares of our common stock valued at $35.9 million , a deferred obligation of up to $20.0 million , which had a fair value of $18.9 million on the date of acquisition, and a liability of $23.6 million related to put and call option agreements , which had a fair value of $23.3 million on the date of acquisition. Subject to any indemnification claims made, the deferred obligation will be released on the first and second anniversary dates of the closing date. The acquisition of ClickPay was financed using funds available under our Credit Facility, as defined in Note 7 , and cash on hand. Pursuant to the acquisition agreement, certain holders initially retained units representing approximately 12% of the membership units of NovelPay, subject to put rights that may be exercised by the holders on or after September 1, 2018, and call rights that may be exercised by us on or after October 1, 2018. The exercise price of the put and call rights is the same as the per unit price of the membership units purchased at the closing. We evaluated the put and call options and determined the put and call options were embedded within the noncontrolling interests, and the economic substance represented a financing arrangement of the noncontrolling interests because of the substantially fixed exercise price and stated exercise dates. In June 2018, we and one of the remaining NovelPay noncontrolling interest holders agreed to waive the put and call exercise date, and we completed the purchase of such holder’s membership units for 395,206 shares of common stock valued at $20.8 million . As of June 30, 2018, approximately 3% of the membership units of NovelPay were held by the remaining noncontrolling interest holders. No earnings have been attributed to the noncontrolling interests in the accompanying Condensed Consolidated Statements of Operations. Such interests, valued at $2.8 million , are recorded as a liability in the accompanying Condensed Consolidated Balance Sheet. The acquired identified intangible assets consisted of developed technology, client relationships, and trade names. These intangible assets were assigned estimated useful lives of seven , ten , and ten years, respectively. Preliminary goodwill recognized of $168.0 million is primarily comprised of anticipated synergies from leveraging ClickPay’s electronic payment platform, which is compatible with multiple third-party property management systems. Goodwill and the acquired identified intangible assets arising from the acquisition of NovelPay are deductible for tax purposes; those arising from the acquisition of ClickPay Services, Inc. are not. Accounts receivable acquired had a gross contractual value of $2.8 million at acquisition, of which $0.1 million was estimated to be uncollectible. Acquisition costs associated with this transaction totaled $1.4 million and were expensed as incurred. Purchase Price Allocation The estimated fair values of assets acquired and liabilities assumed are provisional and are based primarily on the information available as of the acquisition date. We believe this information provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but we are awaiting additional information necessary to finalize those values. Therefore, the provisional measurements of fair value are subject to change, and such changes could be significant. We expect to finalize the valuation of these assets and liabilities as soon as practicable, but no later than one year from the acquisition date. The preliminary allocation of the ClickPay purchase price is as follows, in thousands: Restricted cash $ 1,313 Accounts receivable 2,714 Property, equipment, and software 89 Intangible assets: Developed product technologies 29,100 Client relationships 20,700 Trade names 2,900 Goodwill 168,033 Other assets 489 Accounts payable and accrued liabilities (2,698 ) Client deposits held in restricted accounts (1,313 ) Deferred tax liability, net (4,430 ) Total purchase price $ 216,897 At June 30, 2018 , the deferred obligation related to this acquisition totaled $20.0 million and was carried net of a discount of $0.9 million , in the Condensed Consolidated Balance Sheet. 2017 Acquisitions Lease Rent Options In February 2017, we entered into an agreement with The Rainmaker Ventures, LLC (“Rainmaker”) to acquire substantially all of the assets and liabilities that comprised Rainmaker’s multifamily revenue optimization business (“LRO”). We completed the acquisition when the transaction closed in December 2017. LRO is a revenue management solution that empowers optimized pricing for multifamily housing communities. This acquisition extended our revenue management footprint, augmented our repository of real-time lease transaction data, and increased our data science talent and capabilities. We also expect the acquisition of LRO to increase the market penetration of our YieldStar Revenue Management solution and drive revenue growth in our other asset optimization solutions. We acquired LRO for a purchase price of $299.9 million . The purchase price consisted of a cash payment of $298.0 million , a deferred cash obligation of up to $1.6 million , which had a fair value of $1.5 million on the date of acquisition, and the assumption of certain liabilities totaling $0.4 million . Subject to any indemnification claims made, the deferred cash obligation will be released on the first anniversary of the closing date. The acquisition of LRO was financed using funds available under our Credit Facility, as defined in Note 7 , and cash on hand. The acquired identified intangible assets consisted of developed technology, client relationships, and trade names. These intangible assets were assigned estimated useful lives of seven , ten , and two years, respectively. Preliminary goodwill recognized of $202.9 million is primarily comprised of anticipated synergies from leveraging LRO’s repository of lease transaction data and data science talent with our existing platform of pricing, demand, and credit optimization tools. Goodwill and the acquired identified intangible assets are deductible for tax purposes. Accounts receivable acquired had a gross contractual value of $4.7 million at acquisition, of which $0.2 million was estimated to be uncollectible. Acquisition costs associated with this transaction totaled $13.8 million , including $10.7 million incurred related to the Hart-Scott-Rodino Antitrust Improvements Act review process, and were expensed as incurred. PEX Software In October 2017, we acquired all of the issued and outstanding shares of PEX Software Limited (“PEX”). PEX is a rental housing solution provider based in the United Kingdom that helps companies transform work practices and service delivery models, create and leverage competitive advantage, reduce costs, and scale businesses. PEX’s platform serves market-leading clients in the United Kingdom, European Union, and Australia. The acquisition of PEX will help us to secure a leading market position in the private rental segment of the United Kingdom’s housing market and facilitate our expansion into the European Union and other international markets. We acquired PEX for a purchase price of $6.0 million . The purchase price consisted of a cash payment of $5.1 million at closing, net of cash acquired of $0.1 million , and a deferred cash obligation of up to $1.0 million . The deferred cash obligation is payable over a period of 24 months , and its fair value was $0.9 million at the date of acquisition. This acquisition was financed using cash on hand, which included a portion of the net offering proceeds from the issuance of the Convertible Notes. The acquired identified intangible assets consisted of developed technology, client relationships, and trade names. These intangible assets were assigned estimated useful lives of seven , nine , and six years, respectively. Preliminary goodwill recognized of $3.3 million is chiefly attributable to the presence we gained in international markets and anticipated synergies from combining PEX’s consumer facing solutions with our platform of property management, accounting, and asset optimization solutions. Goodwill and the acquired identified intangible assets are not deductible for tax purposes. Acquisition costs associated with this transaction totaled $0.4 million and were expensed as incurred. On-Site In September 2017, we acquired certain discrete assets of On-Site Manager, Inc., including its ownership interest in its majority-owned subsidiary, DepositIQ & RentersIQ Insurance Agency, LLC (“DIQ”) (collectively, “On-Site”). We also acquired the remaining minority interest in DIQ. On-Site is a leasing platform for property managers and renters that assimilates leads from any source and converts them into signed leases for both the multifamily and single family housing industries. The acquisition of On-Site increased the footprint of our screening services and added incremental consumer-oriented data that benefits our data analytics solutions. Additionally, we anticipate On-Site will improve the integration of our leasing solutions into other major property management systems. We acquired On-Site, including the minority interest in DIQ, for an aggregate purchase price of $253.4 million . The purchase price consisted of a cash payment of $225.3 million at closing, net of cash acquired of $1.7 million , and a deferred cash obligation of up to $29.6 million . The fair value of the deferred cash obligation was $28.1 million at the date of acquisition. Subject to any indemnification claims made, the deferred cash obligation will be paid over a period of 36 months , with the majority due approximately twelve months following the acquisition date. This acquisition was financed using cash on hand, which included a portion of the net offering proceeds from the issuance of the Convertible Notes. The acquired identifiable intangible assets consisted of trade names, developed technologies, and client relationships, which will be amortized over estimated useful lives of two , five , and ten years, respectively. Preliminary goodwill recognized of $184.5 million primarily arises from anticipated synergies from leveraging our existing cost structure and integrated sales force. Goodwill and the acquired identified intangible assets arising from the acquisition of On-Site Manager are deductible for tax purposes; those arising from the acquisition of DIQ are not. Accounts receivable acquired had a gross contractual value of $5.6 million at acquisition, of which $0.9 million was estimated to be uncollectible. Acquisition costs associated with this transaction, including those related to the Hart-Scott-Rodino Antitrust Improvements Act review process, totaled $1.8 million and were expensed as incurred. American Utility Management In June 2017, RealPage acquired substantially all of the assets of American Utility Management (“AUM”), a provider of utility and energy management services for the multifamily housing industry. AUM helps maximize cost recovery, reduces energy usage and expense, and provides the tools operators of rental real estate need to manage their utilities more effectively. Additionally, AUM’s platform includes tools that enable operators to benchmark energy cost and consumption against their peers. The acquired assets will be integrated with our existing resident utility management platform and our data analytics tools. We acquired AUM for a purchase price of $69.4 million . The purchase price consisted of a cash payment of $64.8 million at closing, net of cash acquired of $0.1 million , and a deferred cash obligation of up to $5.1 million . The fair value of the deferred cash obligation was $4.6 million at the date of acquisition and is payable over a period of four years following the date of acquisition. This acquisition was financed using cash on hand, which included a portion of the net offering proceeds from the issuance of the Convertible Notes. The acquired identifiable intangible assets consisted of trade names, developed technology, non-compete agreements, and client relationships, which will be amortized over estimated useful lives of two , three , five , and ten years, respectively. Preliminary goodwill recognized of $45.9 million primarily arises from anticipated synergies from integrating the acquired assets with our existing resident utility management system and leveraging the energy cost and consumption benchmarking capabilities and data acquired. Goodwill and the acquired identified intangible assets are deductible for tax purposes. Accounts receivable acquired had a gross contractual value of $2.7 million at acquisition, of which $0.3 million was estimated to be uncollectible. Acquisition costs associated with this transaction totaled $0.3 million and were expensed as incurred. Axiometrics LLC In January 2017, we acquired substantially all of the assets of Axiometrics LLC (“Axiometrics”). Axiometrics provides its customers with timely market intelligence on apartment markets accumulated from survey and research data. Axiometrics also provides tools to analyze the data at an asset level by multiple variables such as asset class, age, and specific competitive floor plans. The acquisition of Axiometrics expanded our multifamily data analytics platform and was integrated with MPF Research, our market research database, to form Data Analytics. We acquired Axiometrics for a purchase price of $73.8 million . The purchase price consisted of a cash payment of $66.1 million at closing; deferred cash obligations of up to $7.5 million , payable over a period of two years following the date of acquisition; and contingent cash obligations of up to $5.0 million if certain revenue targets are achieved during the twelve -month period ending December 31, 2018 . The fair value of the deferred and contingent cash obligations was $6.9 million and $0.8 million , respectively, at the date of acquisition. This acquisition was financed using cash on hand. The acquired identified intangible assets consisted of developed technology, client relationships, and trade names. These intangible assets were assigned estimated useful lives of five , ten , and three years , respectively. We recognized goodwill in the amount of $54.2 million related to this acquisition, which is primarily comprised of anticipated synergies with our existing multifamily data analytics platform. Goodwill and the acquired identified intangible assets are deductible for tax purposes. Acquisition costs associated with this transaction totaled $0.3 million and were expensed as incurred. Purchase Price Allocation For certain of the acquisitions in the table below, the estimated fair values of assets acquired and liabilities assumed are provisional and are based primarily on the information available as of the acquisition dates. The allocation of each purchase price, including the effects of measurement period adjustments recorded as of June 30, 2018 , was as follows: Axiometrics AUM On-Site PEX LRO (Final) (Final) (Provisional) (Provisional) (Provisional) (in thousands) Restricted cash $ — $ 5,954 $ 3,458 $ — $ — Accounts receivable 1,620 2,409 4,718 107 4,498 Property, equipment, and software 400 319 789 8 1,507 Intangible assets: Developed product technologies 15,500 10,800 16,960 2,350 42,000 Client relationships 6,830 7,470 41,360 590 49,000 Trade names 3,200 208 7,000 160 666 Non-compete agreements — 3,920 — — — Goodwill 54,190 45,907 184,520 3,309 202,852 Other assets 273 850 826 78 475 Accounts payable and accrued liabilities (367 ) (2,150 ) (938 ) (242 ) (214 ) Client deposits held in restricted accounts — (5,954 ) (3,458 ) — — Deferred revenue (7,115 ) (321 ) (565 ) (221 ) (861 ) Other long-term liabilities (774 ) — — — — Deferred tax liability — — (1,240 ) (108 ) — Total purchase price $ 73,757 $ 69,412 $ 253,430 $ 6,031 $ 299,923 At June 30, 2018 and December 31, 2017 , deferred cash obligations related to acquisitions completed in 2017 totaled $38.2 million and $44.8 million , and were carried net of a discount and indemnified obligations of $0.8 million and $2.3 million , respectively, in the Condensed Consolidated Balance Sheets. The aggregate fair value of contingent cash obligations related to these acquisitions was $0.1 million and $0.2 million at June 30, 2018 and December 31, 2017 , respectively. During the three and six months ended June 30, 2018 and 2017 , we recognized a gain of $0.1 million and $0.2 million , respectively, due to changes in the fair value of contingent cash obligations related to acquisitions completed in 2017 . We made deferred cash payments of $6.0 million during the six months ended June 30, 2018 related to these acquisitions. Acquisition Activity Prior to 2017 At June 30, 2018 and December 31, 2017 , the aggregate carrying value of deferred cash obligations related to acquisitions completed prior to 2017 totaled $2.7 million and $4.4 million , respectively. We paid deferred cash obligations related to these acquisitions in the amount of $1.8 million and $7.0 million during the six months ended June 30, 2018 and 2017 , respectively. No contingent cash obligations remained outstanding at June 30, 2018 related to acquisitions completed prior to 2017 . The aggregate carrying value of contingent cash obligations related to these acquisitions was estimated to be $0.2 million at December 31, 2017 . During the six months ended June 30, 2018 and 2017 , we paid contingent cash obligations in the amount of $0.2 million and $0.5 million , respectively, related to acquisitions completed prior to 2017 . We recognized an expense of $0.1 million and $0.2 million during the three and six months ended June 30, 2017 , respectively, due to changes in the fair value of contingent cash obligations related to these acquisitions. Pro Forma Results of Acquisitions The following table presents unaudited pro forma results of operations for the three and six months ended June 30, 2018 and 2017 , as if the aforementioned 2018 and 2017 acquisitions had occurred as of January 1, 2017 and January 1, 2016, respectively. The pro forma information includes the business combination accounting effects resulting from these acquisitions, including interest expense, tax expense or benefit, and additional amortization resulting from the valuation of amortizable intangible assets. We prepared the pro forma financial information for the combined entities for comparative purposes only, and it is not indicative of what actual results would have been if the acquisitions had occurred at the beginning of the periods presented, or of future results. Three Months Ended June 30, Six Months Ended June 30, 2018 Pro Forma 2017 Pro Forma 2018 Pro Forma 2017 Pro Forma (unaudited) (in thousands, except per share amounts) Total revenue $ 218,259 $ 197,492 $ 427,145 $ 386,592 Net income 8,966 4,867 18,757 8,001 Net income per share: Basic $ 0.11 $ 0.06 $ 0.23 $ 0.10 Diluted $ 0.10 $ 0.06 $ 0.21 $ 0.10 |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition On January 1, 2018, we adopted the new revenue standard using the modified retrospective method for those contracts with remaining service obligations as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under the new revenue standard, while prior period amounts are not adjusted and continue to be reported under the accounting standards in effect for the prior period. We recorded a net increase to opening equity of $2.2 million as of January 1, 2018 as the cumulative effect of adopting the new revenue standard. The effect on revenues of adopting the new revenue standard for the three and six months ended June 30, 2018 is presented in the “ Impact on Consolidated Financial Statements ” section below. Disaggregation of Revenue The following table presents our revenues disaggregated by major revenue source. Sales and usage-based taxes are excluded from revenues. Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 (in thousands) On demand Property management $ 46,523 $ 41,405 $ 91,842 $ 81,746 Resident services 85,330 64,860 162,507 125,829 Leasing and marketing 42,841 29,325 82,257 57,140 Asset optimization 32,251 19,137 63,639 36,225 Total on demand revenue 206,945 154,727 400,245 300,940 Professional and other 9,307 6,579 17,308 13,285 Total revenue $ 216,252 $ 161,306 $ 417,553 $ 314,225 On Demand Revenue We generate the majority of our on demand revenue by licensing software-as-a-service (“SaaS”) solutions to our clients on a subscription basis. We group our SaaS solutions in four primary categories: property management, resident services, leasing and marketing and asset optimization. Each solution category generally represents a different stage of the renter life cycle and the operations of a property owner’s or manager’s rental properties. Each of our solution categories includes multiple product centers that provide distinct capabilities that can be bundled as a package or licensed separately. Each on demand solution is provided pursuant to contractual commitments that typically include a promise that we will stand ready, on a monthly basis, to deliver access to our technology platform over defined service delivery periods. The Company has concluded these promises represent a single performance obligation that includes a series of distinct services since they provide a form of rental real estate management and property operation service that we consider to be substantially similar and which has the same pattern of transfer to the client. The majority of our on demand sales revenue continues to be recognized over time as clients receive and consume the benefits of accessing our on demand solutions. Consideration for the Company’s on demand subscription services consist of fixed, variable and usage-based fees. We invoice a portion of our fees at the initial order date and then monthly or annually thereafter. Subscription fees are generally fixed based on the number of sites and the level of services selected by the client. We sell certain usage-based services, primarily within our property management, resident services and leasing and marketing solutions, to clients based on a fixed rate per transaction. Revenues are calculated based on the number of transactions processed monthly and will vary from month to month based on actual usage of these transaction-based services over the contract term, which is typically one year in duration. The fees for usage-based services are not associated with every distinct service promised in the series of distinct services we provide our clients. As a result, we allocate variable usage-based fees only to the related transactions and recognize them in the month that usage occurs. Usage-based fees are considered fully constrained until the related usage occurs. As part of our resident services offerings, we offer risk mitigation services to our clients by acting as an insurance agent and derive commission revenue from the sale of insurance products to our clients’ residents. The commissions are based upon a percentage of the premium that the insurance company underwriting partners charge to the policyholder and are subject to forfeiture in instances where a policyholder cancels prior to the end of the policy. The overall insurance services we provide represent a single performance obligation that qualifies as a separate series in accordance with the new revenue standard. Our contracts with our underwriting partners also provide for contingent commissions to be paid to us in accordance with the agreements. Such commissions are variable in nature and are calculated in accordance with the terms of the agreements, which consider, on the policies sold by us, earned premiums less i) earned agent commissions; ii) a percent of premium retained by our underwriting partners; iii) incurred losses; and iv) profit retained by our underwriting partners during the time period. Our estimate of contingent commission revenue considers historical loss experience on the policies sold by us. The contingent commissions are not associated with every distinct service promised in the series of distinct insurance services we provide. We generally accrue and recognize contingent commissions monthly based on estimates of the factors described above. Professional Services and Other Revenues Professional services and other revenues generally consist of the fees we receive for providing implementation and consulting services, submeter equipment and ongoing maintenance of our existing on premise licenses. Professional Services: Professional services revenues primarily consist of fees for implementation services, consulting services and training. Professional services are billed either on a fixed rate per hour (time) and materials basis or on a fixed price basis. Professional services are typically sold bundled in a contract with other on demand solutions but may be sold separately. Professional service contracts sold separately generally have terms of one year or less. For bundled arrangements, the Company accounts for individual services as a separate performance obligation if a service is separately identifiable from other items in the bundled arrangement and if a client can benefit from it on its own or with other resources readily available to the client. In these cases, the transaction price is allocated between separate services in the bundle based on their relative standalone selling prices. Equipment: The majority of other revenue is related to our sale of submeter hardware and bundled installation services we provide as part of our utility management solutions. We consider the delivery and installation of submeters to be part of a single performance obligation due to the significance of the integration and interdependency of the installation services with the meter equipment. Our typical payment terms for submeter installations require a percentage of the overall transaction price to be paid upfront, with the remainder billed as progress payments. We recognize submeter revenue in proportion to the number of fully installed units completed to date as compared to the total contracted number of units to be provided and installed. We also sell other hardware used for storing mail packages and for processing renter payments and invoices to our clients. For all other equipment sales, we generally recognize revenue when control of the hardware has transferred to our client, which occurs at a point in time, typically upon delivery to the client. On Premise: A small percentage of other revenue is derived from sales of our on premise software solutions, which are distributed to our clients and maintained locally on the client’s hardware. We no longer actively market our legacy on premise software solutions to new clients, and the majority of on premise revenue consists of maintenance renewals from clients who renew for an additional one-year term. Maintenance renewal revenue is recognized ratably over the service period based upon the standalone selling price of that service obligation. Contract Balances Contract assets generally consist of amounts recognized as revenue before they can be invoiced to clients or amounts invoiced to clients prior to the period in which the service is provided where the right to payment is subject to conditions other than just the passage of time. These contract assets are included in “Accounts receivable” in the accompanying Condensed Consolidated Financial Statements and related disclosures. Contract liabilities are comprised of billings or payments received from our clients in advance of performance under the contract. We refer to these contract liabilities as “Deferred revenue” in the accompanying Condensed Consolidated Financial Statements and related disclosures. We recognized $86.7 million of on demand revenue during the six months ended June 30, 2018 , which was included in the line “Deferred revenue” in the accompanying Condensed Consolidated Balance Sheet as of the beginning of the period. Contract Acquisition Costs Under the new revenue standard, we are required to initially capitalize certain contract acquisition costs consisting of commissions earned when contracts are signed. We will subsequently amortize such costs to expense over a period of benefit that we have determined to be three years. Under the previous guidance, we expensed commissions in the period they were earned by our sales representatives. As of June 30, 2018 , the current and noncurrent balance of capitalized commissions costs recorded in the lines “Other current assets” and “Other assets” in the accompanying Condensed Consolidated Balance Sheet was $4.7 million and $6.6 million , respectively. During the three and six months ended June 30, 2018 , we amortized commission costs totaling $1.0 million and $1.8 million , respectively. No impairment loss was recognized in relation to these costs capitalized. Transaction Price Allocated to Remaining Performance Obligations Our client contracts from license and subscription fees relating to our on demand software solutions typically possess a one year renewable term. As such, we disclose within Item 2 the annual client value to allow investors to evaluate future revenue potential. Certain clients commit to purchase our solutions for terms ranging from two to seven years. We expect to recognize approximately $365.3 million of revenue in the future related to performance obligations for on demand contracts with an original duration greater than one year that were unsatisfied or partially unsatisfied as of June 30, 2018 . Our estimate does not include amounts related to: • professional and usage-based services that are billed and recognized based on services performed in a certain period; • amounts attributable to unexercised contract renewals that represent a material right; or • amounts attributable to unexercised client options to purchase services that do not represent a material right. We expect to recognize revenue on approximately 75.0% of the remaining performance obligations over the next 24 months, with the remainder recognized thereafter. Revenue from remaining performance obligations for professional service contracts as of June 30, 2018 was immaterial. Impact on Consolidated Financial Statements In accordance with the new revenue standard requirements, the following tables summarize the effects of this new standard on selected unaudited line items within our Condensed Consolidated Statements of Operations and Balance Sheet: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 As reported Balances without adoption of ASU 2014-09 Effect of Change As reported Balances without adoption of ASU 2014-09 Effect of Change (in thousands) Revenue On demand $ 206,945 $ 207,421 $ (476 ) $ 400,245 $ 400,876 $ (631 ) Professional and other 9,307 8,676 631 17,308 16,095 1,213 Total revenue $ 216,252 $ 216,097 $ 155 $ 417,553 $ 416,971 $ 582 Operating expenses Sales and marketing $ 54,488 $ 56,785 $ 2,297 $ 104,729 $ 108,886 $ 4,157 Net income before income taxes $ 8,290 $ 5,838 $ 2,452 $ 18,890 $ 14,151 $ 4,739 Income tax (benefit) expense (189 ) (1,096 ) (907 ) (490 ) (2,243 ) (1,753 ) Net income $ 8,479 $ 6,934 $ 1,545 $ 19,380 $ 16,394 $ 2,986 Balances at June 30, 2018 - as reported Balances at June 30, 2018 without adoption of ASU 2014-09 Effect of Change (in thousands) Assets Accounts receivable, less allowance for doubtful accounts $ 112,484 $ 119,930 $ (7,446 ) Other current assets 15,812 11,085 4,727 Other assets 20,710 14,109 6,601 Liabilities Current portion of deferred revenue 111,238 115,161 (3,923 ) Deferred revenue 5,181 5,181 — The adoption of ASU 2014-09 had no net effect on the Company’s Condensed Consolidated Statement of Cash Flows for the six months ended June 30, 2018 . |
Property, Equipment and Softwar
Property, Equipment and Software | 6 Months Ended |
Jun. 30, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Equipment and Software | Property, Equipment, and Software Property, equipment, and software consisted of the following at June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 (in thousands) Leasehold improvements $ 61,357 $ 59,179 Data processing and communications equipment 76,357 83,922 Furniture, fixtures, and other equipment 31,635 28,752 Software 118,735 107,924 Property, equipment, and software, gross 288,084 279,777 Less: Accumulated depreciation and amortization (142,744 ) (131,349 ) Property, equipment, and software, net $ 145,340 $ 148,428 Depreciation and amortization expense for property, equipment, and purchased software was $7.5 million and $6.9 million for the three months ended , and $14.4 million and $13.5 million for the six months ended June 30, 2018 and 2017 , respectively. The carrying amount of capitalized software development costs was $83.2 million and $73.4 million at June 30, 2018 and December 31, 2017 , respectively. Total accumulated amortization related to these assets was $33.4 million and $27.8 million at June 30, 2018 and December 31, 2017 , respectively. Amortization expense related to capitalized software development costs totaled $3.0 million and $1.8 million for the three months ended , and $5.5 million and $3.4 million for the six months ended June 30, 2018 and 2017 , respectively. |
Goodwill and Identified Intangi
Goodwill and Identified Intangible Assets | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Identified Intangible Assets | Goodwill and Identified Intangible Assets Changes in the carrying amount of goodwill during the six months ended June 30, 2018 were as follows, in thousands: Balance as of December 31, 2017 $ 751,052 Goodwill acquired 168,033 Measurement period adjustments (300 ) Balance as of June 30, 2018 $ 918,785 Identified intangible assets consisted of the following at June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 Carrying Amount Accumulated Amortization Net Carrying Amount Accumulated Amortization Net (in thousands) Finite-lived intangible assets: Developed technologies $ 194,194 $ (88,434 ) $ 105,760 $ 164,640 $ (76,577 ) $ 88,063 Client relationships 234,418 (91,120 ) 143,298 213,728 (78,390 ) 135,338 Vendor relationships 5,650 (5,650 ) — 5,650 (5,650 ) — Trade names 20,406 (7,786 ) 12,620 17,556 (4,325 ) 13,231 Non-compete agreements 4,173 (1,000 ) 3,173 4,173 (605 ) 3,568 Total finite-lived intangible assets 458,841 (193,990 ) 264,851 405,747 (165,547 ) 240,200 Indefinite-lived intangible assets: Trade names 12,132 — 12,132 12,137 — 12,137 Total identified intangible assets $ 470,973 $ (193,990 ) $ 276,983 $ 417,884 $ (165,547 ) $ 252,337 Amortization expense related to finite-lived intangible assets was $14.7 million and $6.5 million for the three months ended June 30, 2018 and 2017 , respectively. For the six months ended June 30, 2018 and 2017 , amortization expense related to finite-lived intangible assets was $28.5 million and $12.6 million , respectively. |
Debt
Debt | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt | Debt Credit Facility On September 30, 2014 , we entered into an agreement for a secured credit facility to refinance our outstanding revolving loans. The credit facility agreement was subsequently amended during the years ended 2016 and 2017, and was further amended in March 2018 by the Seventh Amendment, discussed below (inclusive of these amendments, the “Credit Facility”). For more information regarding these amendments, refer to our 2017 Form 10-K. The Credit Facility matures on February 27, 2022 , and includes the following: Revolving Facility: The Credit Facility provides $350.0 million in aggregate commitments for revolving loans, with sublimits of $10.0 million for the issuance of letters of credit and $20.0 million for swingline loans (“Revolving Facility”). Term Loan: In February 2016 , we originated a term loan in the original principal amount of $125.0 million under the Credit Facility (“Term Loan”). We made quarterly principal payments of $0.8 million through March 31, 2018 , which increased to $1.5 million beginning on June 30, 2018 , and will increase again to $3.1 million beginning on June 30, 2020 . Delayed Draw Term Loan: In December 2017 , we drew funds of $200.0 million available under the delayed draw term loan (“Delayed Draw Term Loan”). Subsequent to disbursal of the Delayed Draw Term Loan funds, we began making quarterly principal payments on the Delayed Draw Term Loan equal to an initial amount of $1.3 million through March 31, 2018. The quarterly principal payments increased to $2.5 million beginning on June 30, 2018 , and will increase again to $5.0 million beginning on June 30, 2020 . Revolving loans under the Credit Facility may be voluntarily prepaid and re-borrowed. Principal payments on the Term Loan and Delayed Draw Term Loan (collectively, the “Term Loans”) are due in quarterly installments, as described above, and may not be re-borrowed. All outstanding principal and accrued but unpaid interest is due on the maturity date. The Term Loans are subject to mandatory repayment requirements in the event of certain asset sales or if certain insurance or condemnation events occur, subject to customary reinvestment provisions. The Company may prepay the Term Loans in whole or in part at any time, without premium or penalty, with prepayment amounts to be applied to remaining scheduled principal amortization payments as specified by the Company. Accordion Feature: The Credit Facility also allows us, subject to certain conditions, to request additional term loans or revolving commitments up to an aggregate principal amount of $150.0 million , plus an amount that would not cause our Senior Leverage Ratio, as defined below, to exceed 3.50 to 1.00 . At our option, amounts outstanding under the Credit Facility accrue interest at a per annum rate equal to either LIBOR, plus a margin ranging from 1.25% to 2.25% , or the Base Rate, plus a margin ranging from 0.25% to 1.25% (“Applicable Margin”). The base LIBOR is, at our discretion, equal to either one, two, three, or six month LIBOR. The Base Rate is defined as the greater of Wells Fargo's prime rate, the Federal Funds Rate plus 0.50% , or one month LIBOR plus 1.00% . In each case, the Applicable Margin is determined based upon our Net Leverage Ratio, as defined below. Accrued interest on amounts outstanding under the Credit Facility is due and payable quarterly, in arrears, for loans bearing interest at the Base Rate and at the end of the applicable interest period in the case of loans bearing interest at the adjusted LIBOR. Certain of our existing and future material domestic subsidiaries are required to guarantee our obligations under the Credit Facility, and the obligations under the Credit Facility are secured by substantially all of our assets and the assets of the subsidiary guarantors. The Credit Facility contains customary covenants, subject in each case to customary exceptions and qualifications. Our covenants include, among other limitations, a requirement that we comply with a maximum Consolidated Net Leverage Ratio, a minimum Consolidated Interest Coverage Ratio, and a maximum Consolidated Senior Secured Net Leverage Ratio. Consolidated Net Leverage Ratio : The Consolidated Net Leverage Ratio (“Net Leverage Ratio”) is the ratio of consolidated funded indebtedness, as defined in the Credit Facility, on the last day of each fiscal quarter to the sum of the four previous consecutive fiscal quarters’ consolidated EBITDA, as defined in the Credit Facility. As modified by the Seventh Amendment, this ratio generally may not exceed 5.00 to 1.00 . The Net Leverage Ratio may increase, at our option, to 5.50 to 1.00 following an acquisition having aggregate consideration greater than $150.0 million and occurring within a specified time period following the Seventh Amendment Effective Date, defined below. The option to increase this ratio may be elected no more than one time during any consecutive 24 month period over the term of the Credit Facility, and lasts for four consecutive fiscal quarters. As of June 30, 2018 , we had not exercised our option to increase the Net Leverage Ratio. Consolidated Interest Coverage Ratio : The Consolidated Interest Coverage Ratio (“Interest Coverage Ratio”) is the ratio of the sum of our four previous fiscal quarters’ consolidated EBITDA to consolidated interest expense, as defined in the Credit Facility, for the same period. The Interest Coverage Ratio must not be less than 3.00 to 1.00 on the last day of each fiscal quarter. The Interest Coverage Ratio excludes non-cash interest attributable to the Convertible Notes (see Convertible Notes below). Consolidated Senior Secured Net Leverage Ratio : The Consolidated Senior Secured Net Leverage Ratio (“Senior Leverage Ratio”) is the ratio of consolidated senior secured indebtedness, as defined in the Credit Facility, on the last day of each fiscal quarter to the sum of the four previous consecutive fiscal quarters’ consolidated EBITDA and, as modified by the Seventh Amendment, may not exceed 3.75 to 1.00 . At our option, this ratio may be increased to 4.25 to 1.00 for four consecutive fiscal quarters following the completion of an acquisition having aggregate consideration greater than $150.0 million and occurring within a specified time period following the Seventh Amendment Effective Date, defined below. We are not permitted to exercise this option more than one time during any consecutive 24 month period. As of June 30, 2018 , we had not exercised our option to increase the Senior Leverage Ratio. As of June 30, 2018 , we were in compliance with the covenants under our Credit Facility. Seventh Amendment : On March 12, 2018 (“Seventh Amendment Effective Date”), we entered into the seventh amendment (“Seventh Amendment”) to the Credit Facility. This amendment allowed for an increase of $150.0 million in available credit under our Revolving Facility, consequently providing aggregate commitments for revolving loans up to $350.0 million . Among other modifications, the Seventh Amendment provided for an increase in the maximum Net Leverage Ratio and Senior Leverage Ratio to 5.00 to 1.00 and 3.75 to 1.00 , respectively. The Seventh Amendment also modified the Accordion Feature definition to allow for incremental commitments which would not cause our Senior Leverage Ratio to exceed 3.50 to 1.00 . We incurred debt issuance costs in the amount of $1.1 million related to the execution of this amendment. As of June 30, 2018 , we had $350.0 million of available credit under our Revolving Facility. Principal outstanding for the Revolving Facility was $50.0 million at December 31, 2017 . No principal remained outstanding for the Revolving Facility at June 30, 2018 . We incur commitment fees on the unused portion of the Revolving Facility. Principal outstanding, and unamortized debt issuance costs for the Term Loans, were as follows at June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 Term Loan Delayed Draw Term Loan Term Loan Delayed Draw Term Loan (in thousands) Principal outstanding $ 118,057 $ 195,000 $ 120,356 $ 198,750 Unamortized issuance costs (202 ) (754 ) (233 ) (821 ) Unamortized discount (161 ) (425 ) (185 ) (490 ) Carrying value $ 117,694 $ 193,821 $ 119,938 $ 197,439 Unamortized debt issuance costs for the Revolving Facility were $1.5 million and $0.6 million at June 30, 2018 and December 31, 2017 , respectively, and are included in the line “Other assets” in the Condensed Consolidated Balance Sheets. Future maturities of principal under the Term Loans are as follows for the years ending December 31, in thousands: Term Loans 2018 $ 8,066 2019 16,133 2020 28,232 2021 32,266 Thereafter 228,360 $ 313,057 Convertible Notes In May 2017 , the Company issued convertible senior notes with aggregate principal of $345.0 million (including the underwriters’ exercise in full of their over-allotment option of $45.0 million ) which mature on November 15, 2022 (“Convertible Notes”). The Convertible Notes were issued under an indenture dated May 23, 2017 (“Indenture”), by and between the Company and Wells Fargo Bank, N.A., as Trustee. We received net proceeds from the offering of approximately $304.2 million after adjusting for debt issuance costs, including the underwriting discount, the net cash used to purchase the Note Hedges and the proceeds from the issuance of the Warrants which are discussed below. The Convertible Notes accrue interest at a rate of 1.50% , payable semi-annually on May 15 and November 15 of each year beginning on November 15, 2017 . On or after May 15, 2022 , and until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their Convertible Notes at their option. The Convertible Notes are convertible at an initial rate of 23.84 shares per $1,000 of principal (equivalent to an initial conversion price of approximately $41.95 per share of our common stock). The conversion rate is subject to customary adjustments for certain events as described in the Indenture. Upon conversion, we will pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. It is our current intent to settle conversions of the Convertible Notes through combination settlement, which involves repayment of the principal portion in cash and any excess of the conversion value over the principal amount in shares of our common stock. Based on our closing stock price of $55.10 on June 30, 2018 , the if-converted value exceeded the aggregate principal amount of the Convertible Notes by $108.2 million . As described below, we entered into convertible note hedge transactions, which are expected to reduce the potential dilution with respect to our common stock upon conversion of the Convertible Notes. Holders may convert their Convertible Notes, at their option, prior to May 15, 2022 only under the following circumstances: • during any calendar quarter commencing after the calendar quarter ending on June 30, 2017 (and only during such calendar quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; • during the five business day period after any five consecutive trading day period (the “Measurement Period”) in which the trading price per $1,000 principal amount of the Convertible Notes for each trading day of the Measurement Period was less than 98% of the product of the last reported sales price of our common stock and the conversion rate on each such trading day; or • upon the occurrence of specified corporate events, as defined in the Indenture. We may not redeem the Convertible Notes prior to their maturity date, and no sinking fund is provided for them. If we undergo a fundamental change, as described in the Indenture, subject to certain conditions, holders may require us to repurchase for cash all or any portion of their Convertible Notes. The fundamental change repurchase price is equal to 100% of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. If holders elect to convert their Convertible Notes in connection with a make-whole fundamental change, as described in the Indenture, the Company will, to the extent provided in the Indenture, increase the conversion rate applicable to the Convertible Notes. The Convertible Notes are senior unsecured obligations and rank senior in right of payment to any of our indebtedness that is expressly subordinated in right of payment to the Convertible Notes and equal in right of payment to any of our existing and future unsecured indebtedness that is not subordinated. The Convertible Notes are effectively junior in right of payment to any of our secured indebtedness (to the extent of the value of assets securing such indebtedness) and structurally junior to all existing and future indebtedness and other liabilities, including trade payables, of our subsidiaries. The Indenture does not limit the amount of debt that we or our subsidiaries may incur. The Convertible Notes are not guaranteed by any of our subsidiaries. The Indenture does not contain any financial or operating covenants or restrictions on the payments of dividends, the incurrence of indebtedness, or the issuance or repurchase of securities by us or any of our subsidiaries. The Indenture contains customary events of default with respect to the Convertible Notes and provides that upon certain events of default occurring and continuing, the Trustee may, and the Trustee at the request of holders of at least 25% in principal amount of the Convertible Notes shall, declare all of principal and accrued and unpaid interest, if any, of the Convertible Notes to be due and payable. In case of certain events of bankruptcy, insolvency or reorganization, involving us or a significant subsidiary, all of the principal of and accrued and unpaid interest on the Convertible Notes will automatically become due and payable. In accounting for the issuance of the Convertible Notes, we separated the Convertible Notes into liability and equity components. We allocated $282.5 million of the Convertible Notes to the liability component, and $62.5 million to the equity component. The excess of the principal amount of the liability component over its carrying amount is amortized to interest expense over the term of the Convertible Notes using the effective interest method. The equity component will not be remeasured as long as it continues to meet the conditions for equity classification. We incurred issuance costs of $9.8 million related to the Convertible Notes. Issuance costs were allocated to the liability and equity components based on their relative values. Issuance costs attributable to the liability component are being amortized to interest expense over the term of the Convertible Notes, and issuance costs attributable to the equity component are included along with the equity component in stockholders' equity. During the quarter ended June 30, 2018 , the closing price of our common stock exceeded 130% of the conversion price of the Convertible Notes for more than 20 trading days during the last 30 consecutive trading days of the quarter, thereby satisfying one of the early conversion events. As a result, the Convertible Notes are convertible at any time during the fiscal quarter ending September 30, 2018 . Accordingly, as of June 30, 2018 , the carrying amount of the Convertible Notes of $286.9 million was reclassified from non-current liabilities to current liabilities in the accompanying Condensed Consolidated Balance Sheets . No gain or loss was recognized when the debt became convertible. The net carrying amount of the Convertible Notes at June 30, 2018 and December 31, 2017 , was as follows: June 30, 2018 December 31, 2017 (in thousands) Liability component: Principal amount $ 345,000 $ 345,000 Unamortized discount (51,471 ) (56,557 ) Unamortized debt issuance costs (6,621 ) (7,244 ) $ 286,908 $ 281,199 Equity component, net of issuance costs and deferred tax: $ 61,390 $ 61,390 The following table sets forth total interest expense related to the Convertible Notes for the three and six months ended June 30, 2018 and 2017 : Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 (in thousands) Contractual interest expense $ 1,294 $ 561 $ 2,588 $ 561 Amortization of debt discount 2,562 1,052 5,086 1,052 Amortization of debt issuance costs 328 134 651 134 $ 4,184 $ 1,747 $ 8,325 $ 1,747 The effective interest rate of the liability component for the three and six months ended June 30, 2018 and 2017 was 5.87% . Convertible Note Hedges and Warrants On May 23, 2017 , we entered into privately negotiated transactions to purchase hedge instruments (“Note Hedges”), covering approximately 8.2 million shares of our common stock at a cost of $62.5 million . The Note Hedges are subject to anti-dilution provisions substantially similar to those of the Convertible Notes, have a strike price of approximately $41.95 per share, are exercisable by us upon any conversion under the Convertible Notes, and expire on November 15, 2022 . The Note Hedges are generally expected to reduce the potential dilution to our common stock (or, in the event the conversion is settled in cash, to reduce our cash payment obligation) in the event that at the time of conversion our stock price exceeds the conversion price under the Convertible Notes. The cost of the Note Hedges is expected to be tax deductible as an original issue discount over the life of the Convertible Notes, as the Convertible Notes and the Note Hedges represent an integrated debt instrument for tax purposes. The cost of the Note Hedges was recorded as a reduction of our additional paid-in capital in the accompanying Condensed Consolidated Financial Statements. On May 23, 2017 , the Company also sold warrants for the purchase of up to 8.2 million shares of our common stock for aggregate proceeds of $31.5 million (“Warrants”). The Warrants have a strike price of $57.58 per share and are subject to customary anti-dilution provisions. The Warrants will expire in ratable portions on a series of expiration dates commencing on February 15, 2023 . The proceeds from the issuance of the Warrants were recorded as an increase to our additional paid-in capital in the accompanying Condensed Consolidated Financial Statements. The Note Hedges are transactions that are separate from the terms of the Convertible Notes and the Warrants, and holders of the Convertible Notes and the Warrants have no rights with respect to the Note Hedges. The Warrants are similarly separate in both terms and rights from the Note Hedges and the Convertible Notes. As of June 30, 2018 , no Note Hedges or Warrants had been exercised. |
Stock-based Expense
Stock-based Expense | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-based Expense | Stock-based Expense During the three and six months ended June 30, 2018 , the Company made the following grants of time-based restricted stock: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Vesting 163,766 978,444 Shares vest ratably over a period of twelve quarters beginning on the first day of the second calendar quarter immediately following the grant date. — 3,600 Shares fully vested on the first day of the calendar quarter immediately following the grant date. 33,846 33,846 Shares vest ratably over a period of four quarters beginning on the first day of the calendar quarter immediately following the grant date. During the six months ended June 30, 2018 , we granted 517,364 shares of restricted stock that become eligible to vest based on the achievement of certain market-based conditions, as described below: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Condition to Become Eligible to Vest — 129,341 After the grant date and prior to July 1, 2021, the average closing price per share of our common stock equals or exceeds $60.89 for twenty consecutive trading days. — 129,341 After the grant date and prior to July 1, 2021, the average closing price per share of our common stock equals or exceeds $66.98 for twenty consecutive trading days. — 129,341 After the grant date and prior to July 1, 2021, the average closing price per share of our common stock equals or exceeds $73.07 for twenty consecutive trading days. — 129,341 After the grant date and prior to July 1, 2021, the average closing price per share of our common stock equals or exceeds $85.24 for twenty consecutive trading days. Shares that become eligible to vest, if any, become Eligible Shares. These awards vest ratably over four calendar quarters beginning on the first day of the next calendar quarter immediately following the date on which they become Eligible Shares. Vesting is conditional upon the recipient remaining a service provider, as defined in the plan document, to the Company through each applicable vesting date. Grants of restricted stock may be fulfilled through the issuance of previously authorized but unissued common stock shares, or the reissuance of shares held in treasury. All awards were granted under the Amended and Restated 2010 Equity Incentive Plan. The Company capitalized $0.4 million and $0.5 million of stock-based expense for software development costs during the three and six months ended June 30, 2018 , respectively. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Lease Commitments We lease office facilities and equipment for various terms under long-term, non-cancellable operating lease agreements. The leases expire at various dates through 2028 and provide for renewal options. The agreements generally require us to pay for executory costs such as real estate taxes, insurance, and repairs. At June 30, 2018 , minimum annual rental commitments under non-cancellable operating leases were as follows for the years ending December 31, in thousands: 2018 $ 8,085 2019 14,342 2020 11,829 2021 10,986 2022 9,336 Thereafter 46,121 $ 100,699 Guarantor Arrangements We have agreements whereby we indemnify our officers and directors for certain events or occurrences while the officer or director is or was serving at our request in such capacity. The term of the indemnification period is for the officer or director’s lifetime. The maximum potential amount of future payments we could be required to make under these indemnification agreements is unlimited; however, we have a director and officer insurance policy that limits our exposure and enables us to recover a portion of any future amounts paid. As a result of our insurance policy coverage, we believe the estimated fair value of these indemnification agreements is minimal. Accordingly, we had no liabilities recorded for these agreements as of June 30, 2018 or December 31, 2017 . In the ordinary course of our business, we include standard indemnification provisions in our agreements with clients. Pursuant to these provisions, we indemnify our clients for losses suffered or incurred in connection with third-party claims that our products infringed upon any U.S. patent, copyright, trademark, or other intellectual property right. Where applicable, we generally limit such infringement indemnities to those claims directed solely to our products and not in combination with other software or products. With respect to our products, we also generally reserve the right to resolve any such claims by designing a non-infringing alternative, by obtaining a license on reasonable terms, or by terminating our relationship with the client and refunding the client’s fees. The potential amount of future payments to defend lawsuits or settle indemnified claims under these indemnification provisions is unlimited in certain agreements; however, we believe the estimated fair value of these indemnification provisions is minimal, and, accordingly, we had no liabilities recorded for these agreements as of June 30, 2018 or December 31, 2017 . Litigation From time to time, in the normal course of our business, we are a party to litigation matters and claims. Litigation can be expensive and disruptive to our normal business operations. Moreover, the results of complex legal proceedings are difficult to predict, and our view of these matters may change in the future as the litigation and events related thereto unfold. We expense legal fees as incurred. Insurance recoveries associated with legal costs incurred are recorded when they are deemed probable of recovery. On February 23, 2015, we received from the Federal Trade Commission (“FTC”) a Civil Investigative Demand consisting of interrogatories and a request to produce documents relating to our compliance with the Fair Credit Reporting Act (“FCRA”) . We responded to the request and requests for additional information by the FTC. On November 2, 2017, the FTC staff informed us of its belief that there is a basis for claims that could include monetary and injunctive relief against us for failing to follow reasonable procedures to assure maximum possible accuracy of our tenant screening reports. We believe that our business practices did not, and do not, violate the FCRA or any other laws, and we intend to vigorously defend our position. We have had ongoing discussions with the FTC to attempt to resolve the matter. However, we cannot be certain that the matter will be resolved as a result of these discussions. At June 30, 2018 and December 31, 2017 , we had accrued amounts for estimated settlement losses related to legal matters. The Company does not believe there is a reasonable possibility that a material loss exceeding amounts already recognized may have been incurred as of the date of the balance sheets presented herein. We are involved in other litigation matters not described above that are not likely to be material either individually or in the aggregate based on information available at this time. Our view of these matters may change as the litigation and events related thereto unfold. |
Net Income per Share
Net Income per Share | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Income per Share | Net Income per Share Basic net income per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed by using the weighted average number of common shares outstanding, after giving effect to all potential dilutive common shares outstanding during the period. Included within diluted net income per share is the dilutive effect of outstanding stock options and restricted stock using the treasury stock method. Weighted average shares from common share equivalents in the amount of 78,968 and 27,422 for the three months ended and 322,234 and 362,522 for the six months ended June 30, 2018 and 2017 , respectively, were excluded from the dilutive shares outstanding because their effect was anti-dilutive. For purposes of considering the Convertible Notes in determining diluted net income per share , it is our current intent to settle conversions of the Convertible Notes through combination settlement, which involves repayment of the principal portion in cash and any excess of the conversion value over the principal amount (the “conversion premium”) in shares of our common stock. Therefore, only the impact of the conversion premium is included in total dilutive weighted average shares outstanding using the treasury stock method. The dilutive effect of the conversion premium for the three and six month periods ended June 30, 2018 is shown in the table below. The Warrants sold in connection with the issuance of the Convertible Notes will not be considered in calculating the total dilutive weighted average shares outstanding until the price of our common stock exceeds the strike price of $57.58 per share, as described in Note 7 . When the price of our common stock exceeds the strike price of the Warrants, the effect of the additional shares that may be issued upon exercise of the Warrants will be included in total dilutive weighted average shares outstanding using the treasury stock method. The Note Hedges purchased in connection with the issuance of the Convertible Notes are considered to be anti-dilutive and therefore do not impact our calculation of diluted net income per share . Refer to Note 7 for further discussion regarding the Convertible Notes. We exclude common shares held in escrow pursuant to business combinations from the calculation of basic weighted average shares outstanding where the release of such shares is contingent upon an event not solely subject to the passage of time. As of June 30, 2018 , there were 187,480 contingently returnable shares related to the ClickPay acquisition which are excluded from the computation of basic net income per share as these shares are subject to sellers’ indemnification obligations and are being held in escrow. There were no contingently returnable shares as of June 30, 2017 . Dilutive common shares outstanding include the weighted average contingently issuable shares discussed above that are currently in escrow, as well as the weighted average contingently issuable shares to be issued and placed in escrow on the first anniversary date of the acquisition. These shares are subject to release to the sellers on the first and second anniversary date of the acquisition which are contingent on the sellers’ indemnification obligations. Refer to Note 3 for further discussion regarding the ClickPay acquisition. The following table presents the calculation of basic and diluted net income per share : Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 (in thousands, except per share amounts) Numerator: Net income $ 8,479 $ 6,213 $ 19,380 $ 14,408 Denominator: Basic: Weighted average common shares used in computing basic net income per share 85,124 79,018 83,156 78,642 Diluted: Add weighted average effect of dilutive securities: Stock options and restricted stock 2,474 2,907 2,310 3,002 Convertible Notes 2,116 — 1,720 — Contingently issuable shares in connection with ClickPay acquisition 291 — 146 — Weighted average common shares used in computing diluted net income per share 90,005 81,925 87,332 81,644 Net income per share: Basic $ 0.10 $ 0.08 $ 0.23 $ 0.18 Diluted $ 0.09 $ 0.08 $ 0.22 $ 0.18 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We make estimates and judgments in determining our provision for income taxes for financial statement purposes. These estimates and judgments occur in the calculation of certain tax assets and liabilities that arise from differences in the timing of recognition of revenue and expense for tax and financial statement purposes. Our provision for income taxes in interim periods is based on our estimated annual effective tax rate. We record cumulative adjustments in the quarter in which a change in the estimated annual effective rate is determined. The estimated annual effective tax rate calculation does not include the effect of discrete events that may occur during the year. The effect of these events, if any, is recorded in the quarter in which the event occurs. On December 22, 2017, the Tax Cuts and Jobs Act (“Tax Reform Act”) was enacted into law which changed U.S. tax law, including, but not limited to: (1) reducing the U.S. federal corporate income tax rate from 35% to 21% (2) requiring companies to pay a one-time transition tax on certain unrepatriated earnings of foreign subsidiaries (3) generally eliminating U.S. federal corporate income taxes on dividends from foreign subsidiaries (4) capitalizing U.S. R&D expenses which are amortized over five years and (5) other changes affecting how foreign and domestic earnings are taxed. Due to the complexities involved in accounting for the enactment of the new law, the SEC issued Staff Accounting Bulletin No. 118 ("SAB 118") to address the application of US GAAP in situations where 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 Reform Act. At December 31, 2017, we recorded provisional estimates in accordance with SAB 118, including a provisional determination of the impact of the change in corporate tax rates on our deferred tax balances, and a provisional estimate of the amount of transition tax associated with the mandatory deemed repatriation of foreign earnings. We did not make any changes to our provisional estimates during the quarter ended June 30, 2018 . We will continue to analyze the impact of the Tax Reform Act as additional guidance is provided by the IRS and state taxing authorities. Additional impacts will be recorded as they are identified during the measurement period provided for in SAB 118. The Tax Reform Act includes a provision to tax global intangible low-taxed income (“GILTI”) of foreign subsidiaries and a base erosion anti-abuse tax (“BEAT”) measure that taxes certain payments between a U.S. corporation and its foreign subsidiaries. These provisions of the Tax Reform Act were effective for the Company beginning January 1, 2018. The FASB Staff Q&A, Topic 740, No. 5, Accounting for Global Intangible Low-Taxed Income, states that an entity can make an accounting policy election to either recognize deferred taxes for temporary differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred as a period expense only. Given the complexity of the GILTI provisions, we are still evaluating the effects of the GILTI provisions and have not yet determined our accounting policy. At June 30, 2018 , because we are still evaluating the GILTI provisions and our analysis of future taxable income that is subject to GILTI, we have included GILTI related to current year operations only in our estimated annual effective tax rate and have not provided additional GILTI on deferred items. Our effective income tax rate was (2.6)% and (19.2)% for the six months ended June 30, 2018 and 2017 , respectively. Our effective rate is lower than the statutory rate for the six months ended June 30, 2018 and 2017 , primarily because of excess tax benefits from stock-based compensation of $7.1 million and $7.2 million , respectively, recognized as discrete items, as required by ASU 2016-09. As a result of our adoption of ASU 2014-09, on January 1, 2018, we recorded a net deferred tax liability of $0.8 million , with a corresponding increase to accumulated deficit. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements We record certain assets and financial liabilities at fair value on a recurring basis. We determine fair values based on the price we would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The prescribed fair value hierarchy is as follows: Level 1 - Inputs are quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs are quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable; and market-corroborated inputs which are derived principally from or corroborated by observable market data. Level 3 - Inputs are derived from valuation techniques in which one or more of the significant inputs or value drivers are unobservable. The categorization of an asset or liability within the fair value hierarchy is based on the inputs described above and does not necessarily correspond to our perceived risk of that asset or liability. Moreover, the methods used by us may produce a fair value calculation that is not indicative of the net realizable value or reflective of future fair values. Furthermore, although we believe our valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments and non-financial assets and liabilities could result in a different fair value measurement at the reporting date. Assets and liabilities measured at fair value on a recurring basis: Interest rate swap agreements: The fair value of our interest rate swap agreements are determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of the swap agreements. This analysis reflects the contractual terms of the swap agreements, including the period to maturity, and uses observable market-based inputs, including interest rate curves. We incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. Although we have determined that the majority of the inputs used to value its swap agreements fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our swap agreements utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by us and our counterparties. We have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our swap agreements’ positions and have determined that the credit valuation adjustments are not significant to the overall valuation of our swap agreements. As a result, we determined that our valuation of the swap agreements in its entirety is classified in Level 2 of the fair value hierarchy. Contingent consideration obligations: Contingent consideration obligations consist of potential obligations related to our acquisition activity. The amount to be paid under these obligations is contingent upon the achievement of stipulated operational or financial targets by the business subsequent to acquisition. The fair value of contingent consideration obligations is estimated using a probability weighted discount model which considers the achievement of the conditions upon which the respective contingent obligation is dependent. The probability of achieving the specified conditions is assessed by applying a Monte Carlo weighted-average model. Inputs into the valuation model include a discount rate specific to the acquired entity, a measure of the estimated volatility, and the risk free rate of return. In addition to the inputs described above, the fair value estimates consider the projected future operating or financial results for the factor upon which the respective contingent obligation is dependent. The fair value estimates are generally sensitive to changes in these projections. We develop the projected future operating results based on an analysis of historical results, market conditions, and the expected impact of anticipated changes in our overall business and/or product strategies. Significant unobservable inputs used in the contingent consideration fair value measurements included the following at June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 Discount rates 16.5 % 16.3 % Volatility rates 25.0 % 24.0 % Risk free rate of return 2.2 % 1.6 % The following tables disclose the assets and liabilities measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017 , by the fair value hierarchy levels as described above: Fair value at June 30, 2018 Total Level 1 Level 2 Level 3 (in thousands) Assets: Interest rate swap agreements $ 1,465 $ — $ 1,465 $ — Liabilities: Contingent consideration related to the acquisition of: Axiometrics 52 — — 52 Total liabilities measured at fair value $ 52 $ — $ — $ 52 Fair value at December 31, 2017 Total Level 1 Level 2 Level 3 (in thousands) Assets: Interest rate swap agreements $ 1,329 $ — $ 1,329 $ — Liabilities: Contingent consideration related to the acquisition of: AssetEye 247 — — 247 Axiometrics 167 — — 167 Total liabilities measured at fair value $ 414 $ — $ — $ 414 There were no transfers between Level 1 and Level 2, or between Level 2 and Level 3 measurements during the six months ended June 30, 2018 . Changes in the fair value of Level 3 measurements were as follows for the six months ended June 30, 2018 and 2017 : Six Months Ended June 30, 2018 2017 (in thousands) Balance at beginning of period $ 414 $ 541 Initial contingent consideration — 812 Settlements through cash payments (247 ) — Net (gain) loss on change in fair value (115 ) 41 Balance at end of period $ 52 $ 1,394 Gains and losses recognized on the change in fair value of our Level 3 measurements are reflected in the line, “General and administrative” in the accompanying Condensed Consolidated Statements of Operations. Financial Instruments The financial assets and liabilities that are not measured at fair value in our Condensed Consolidated Balance Sheets include cash and cash equivalents, restricted cash, accounts receivable, investments, accounts payable and accrued expenses, acquisition-related deferred cash and stock obligations, obligations under the Term Loans, obligations under the Revolving Facility, and the Convertible Notes. The carrying values of cash and cash equivalents; restricted cash; accounts receivable; and accounts payable and accrued expenses reported in our Condensed Consolidated Balance Sheets approximates fair value due to the short term nature of these instruments. Acquisition-related deferred cash and stock obligations are recorded on the date of acquisition at their estimated fair value, based on the present value of the anticipated future cash flows. The difference between the amount of the deferred cash and stock obligation to be paid and its estimated fair value on the date of acquisition is accreted over the obligation period. As a result, the carrying value of acquisition-related deferred cash and stock obligations approximates their fair value. Revolving Facility : There was no principal outstanding under the Revolving Facility at June 30, 2018 . Due to its short-term nature and market-indexed interest rates, we concluded that the carrying value of the Revolving Facility approximated its fair value at December 31, 2017 . Term Loans : The fair value of the Term Loans was estimated by discounting future cash flows using prevailing market interest rates on debt with similar creditworthiness, terms, and maturities. We concluded that this fair value measurement should be categorized within Level 2. Convertible Notes : We estimated the fair value of the Convertible Notes based on quoted market prices as of the last trading day for the six months ended June 30, 2018 ; however, the Convertible Notes have only a limited trading volume and as such, this fair value estimate is not necessarily the value at which the Convertible Notes could be retired or transferred. We concluded this measurement should be classified within Level 2. The fair value and carrying value of the Term Loans and Convertible Notes were as follows at June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 Fair Value Carrying Value Fair Value Carrying Value (in thousands) Term Loans $ 303,280 $ 311,515 $ 303,806 $ 317,377 Convertible Notes 491,177 286,908 430,301 281,199 The carrying value of the Term Loans and Convertible Notes are reflected net of unamortized discount and issuance costs in our Condensed Consolidated Balance Sheets. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Shelf Registration and Public Offering On May 21, 2018 , we filed a shelf registration statement on Form S-3 (File No. 333-225074) with the Securities and Exchange Commission (the “SEC”), which became effective upon filing. The shelf registration allows us to sell, from time to time, an unspecified number of shares of common stock; shares of preferred stock; debt securities; warrants to purchase shares of common stock, preferred stock, or other securities; purchase contracts; and units representing two or more of the foregoing securities. On May 29, 2018 , we consummated an underwritten public offering of 8.05 million shares of our common stock, which included 1.05 million shares sold pursuant to the underwriters’ full exercise of their option to purchase additional shares. The offering was priced at $57.00 per share for total gross proceeds of $458.9 million . The aggregate net proceeds to us were $441.8 million , after deducting underwriting discounts and offering expenses in the aggregate amount of $17.1 million . Increase in Authorized Shares On June 5, 2018 , our stockholders approved an amendment to the Company’s Certificate of Incorporation to increase the authorized number of shares of our Common Stock from 125,000,000 to 250,000,000 shares. Our board of directors had previously approved the amendment in 2018. Stock Repurchase Program In May 2014, our board of directors approved a share repurchase program authorizing the repurchase of up to $50.0 million of our outstanding common stock for a period of up to one year after the approval date. Shares repurchased under the plan are retired. Our board of directors approved a one year extension of this program in 2015, 2016 and 2017. This program expired in May 2018 . There was no repurchase activity during the three and six months ended June 30, 2018 and 2017 . |
Derivative Financial Instrument
Derivative Financial Instruments | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments On March 31, 2016 , we entered into two interest rate swap agreements (collectively the “Swap Agreements”), which are designed to mitigate our exposure to interest rate risk associated with a portion of our variable rate debt. The Swap Agreements cover an aggregate notional amount of $75.0 million from March 2016 to September 2019 by replacing the obligation’s variable rate with a blended fixed rate of 0.89% . We designated the Swap Agreements as cash flow hedges of interest rate risk. The effective portion of changes in the fair value of the Swap Agreements is recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. The ineffective portion of the change in the fair value of the Swap Agreements is recognized directly in earnings. Amounts reported in accumulated other comprehensive income related to the Swap Agreements will be reclassified to interest expense as interest payments are made on our variable-rate debt. We estimate that during the next twelve months, an additional $1.1 million will be reclassified to earnings as a decrease to interest expense. As of June 30, 2018 , the Swap Agreements were still outstanding. The table below presents the notional and fair value of the Swap Agreements as well as their classification in the Condensed Consolidated Balance Sheets as of June 30, 2018 and December 31, 2017 : Balance Sheet Location Notional Fair Value (in thousands) Derivatives designated as cash flow hedging instruments: Swap agreements as of June 30, 2018 Other assets $ 75,000 $ 1,465 Swap agreements as of December 31, 2017 Other assets $ 75,000 $ 1,329 As of June 30, 2018 , we have not posted any collateral related to the Swap Agreements. If we had breached any of the Swap Agreement’s default provisions at June 30, 2018 , we could have been required to settle our obligations under the Swap Agreements at their termination value of $1.5 million . The tables below present the amount of gains and losses related to the effective and ineffective portions of the Swap Agreements and their location in the Condensed Consolidated Statements of Operations and the Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2018 and 2017 , in thousands: Effective Portion Ineffective Portion Derivatives Designated as Cash Flow Hedges Gain (Loss) Recognized in OCI Location of Gain (Loss) Recognized in Income Gain (Loss) Recognized in Income Location of Gain (Loss) Recognized in Income Gain (Loss) Recognized in Income Three months ended June 30, 2018: Swap agreements, net of tax $ 108 Interest expense and other $ 145 Interest expense and other $ (15 ) Three months ended June 30, 2017: Swap agreements, net of tax $ (21 ) Interest expense and other $ (3 ) Interest expense and other $ 10 Effective Portion Ineffective Portion Derivatives Designated as Cash Flow Hedges Gain (Loss) Recognized in OCI Location of Gain (Loss) Recognized in Income Gain (Loss) Recognized in Income Location of Gain (Loss) Recognized in Income Gain (Loss) Recognized in Income Six months ended June 30, 2018: Swap agreements, net of tax $ 367 Interest expense and other $ 244 Interest expense and other $ (31 ) Six months ended June 30, 2017: Swap agreements, net of tax $ 73 Interest expense and other $ 9 Interest expense and other $ 28 |
Investments
Investments | 6 Months Ended |
Jun. 30, 2018 | |
Investments, All Other Investments [Abstract] | |
Investments | Investments Compstak In August 2016, we acquired a minority interest in Compstak, Inc. (“Compstak”), which is an unrelated company that specializes in the aggregation of commercial lease data. The shares we acquired represent an ownership interest of less than 20% . We evaluated our relationship with Compstak and determined we do not have significant influence over its operations nor is it economically dependent upon us. The carrying value of this investment at both June 30, 2018 and December 31, 2017 was $3.0 million and is included in “Other assets” in the accompanying Condensed Consolidated Balance Sheets. WayBlazer In January 2018, we paid $2.0 million in cash in return for a convertible promissory note (“Note”) from WayBlazer, Inc. (“WayBlazer”), which is an unrelated company that specializes in an artificial intelligence platform for the travel industry. The Note bears interest at 8% per annum and matures in December 2020. The Note is convertible into WayBlazer’s common stock shares upon a qualified financing event, as defined in the Note. If converted, the shares would represent an approximate 8% ownership interest. This investment is included in “Other assets” in the accompanying Condensed Consolidated Balance Sheets. We also entered into a strategic development agreement (“Development Agreement”) with WayBlazer for the development of property management applications. Under the terms of the Development Agreement, we will pay direct development costs, and a license fee to use any property management applications developed. The initial license term is five years. At the end of the license term, we have the right to purchase a perpetual license for the applications. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events BluTrend On July 13, 2018 , we acquired substantially all of the assets of Blu Trend, LLC (“BluTrend”), a provider of utility management services for the multifamily housing industry. The acquired assets will be integrated with our existing resident utility management platform. Purchase consideration was comprised of a cash payment at closing of $8.5 million , deferred cash obligations of up to $1.0 million , and deferred stock obligations of up to $1.0 million . The deferred obligations are subject to forfeiture upon the occurrence of certain events and any indemnification claims made, and will be released in part on the first anniversary of the closing with the remainder released on the second anniversary of the closing. LeaseLabs On August 1, 2018 , we entered into an agreement to acquire substantially all of the assets of LeaseLabs, Inc. (“LeaseLabs”), a full stack marketing solutions provider to the multifamily housing industry. The closing of the proposed acquisition is subject to standard closing conditions and completion of regulatory review. Upon closing of the transaction, the acquired assets will be integrated with our existing marketing solutions platform. The purchase price will consist of a payment of up to $103.0 million in cash and common stock, and a contingent cash obligation of up to approximately $14.0 million , based on the achievement of certain financial objectives. The purchase price is subject to working capital adjustments and includes deferred cash obligations of up to $11.8 million and a deferred stock obligation of $5.0 million . Subject to any indemnification claims made, the deferred cash obligations will be released in part on the first anniversary of the closing with the remainder released on the second anniversary of the closing. The deferred stock obligations will be issued at the first anniversary of the closing. Due to the timing of these acquisitions, certain disclosures required by ASC 805, including the allocation of the purchase price, have been omitted because the initial accounting for the business combinations was incomplete as of the filing date of this report. Such information will be included in our subsequent Form 10-Q. |
Summary of Significant Accoun25
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements and footnotes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. We believe that the disclosures made are appropriate and conform to those rules and regulations, and that the condensed or omitted information is not misleading. The unaudited Condensed Consolidated Financial Statements included herein reflect all adjustments (consisting of normal, recurring adjustments) which are, in the opinion of management, necessary to state fairly the results for the interim periods presented. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the interim periods presented are not necessarily indicative of the operating results to be expected for any subsequent interim period or for the fiscal year. These financial statements should be read in conjunction with the financial statements and the notes thereto included in our Annual Report on Form 10-K filed with the SEC on March 1, 2018 (“Form 10-K”). |
Segment and Geographic Information | Segment and Geographic Information Our chief operating decision maker is our Chief Executive Officer, who reviews financial information presented on a company-wide basis. As a result, we determined that the Company has a single reporting segment and operating unit structure. |
Concentrations of Credit Risk | Concentrations of Credit Risk Our cash accounts are maintained at various financial institutions and may, from time to time, exceed federally insured limits. We have not experienced any losses in such accounts. Concentrations of credit risk with respect to accounts receivable result from substantially all of our clients being in the residential rental housing market. Our clients, however, are dispersed across different geographic areas. We do not require collateral from clients. We maintain an allowance for doubtful accounts for credits we offer our clients in certain instances and to reflect our best estimate of the amount of consideration we will ultimately receive based on relevant factors such as our historical experience, current contractual requirements, potential client buying patterns, age of the outstanding balance, and our clients’ ability to pay. |
Accounting Policies and Use of Estimates | Accounting Policies and Use of Estimate s The preparation of financial statements in conformity with GAAP requires our management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities, at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Significant estimates include the allowance for doubtful accounts; the useful lives of intangible assets and the recoverability or impairment of tangible and intangible asset values; fair value measurements; contingent commissions related to the sale of insurance products; valuation of net assets acquired and contingent consideration in connection with business combinations; revenue and deferred revenue and related reserves; stock-based expense; and our effective income tax rate and the recoverability of deferred tax assets, which are based upon our expectations of future taxable income and allowable deductions. Actual results could differ from these estimates. For greater detail regarding these accounting policies and estimates, refer to our Form 10-K. |
Cash and Cash Equivalents | Cash and Cash Equivalents We consider all highly liquid investments with a maturity date, when purchased, of three months or less to be cash equivalents. |
Restricted Cash | Restricted Cash Restricted cash consists of cash collected from tenants that will be remitted primarily to our clients. |
Business Combinations | Business Combinations We apply the guidance contained in ASC Topic 805, Business Combinations (“ASC 805”) in determining whether an acquisition transaction constitutes a business combination. ASC 805 defines a business as consisting of inputs and processes applied to those inputs that have the ability to create outputs. The acquisition transactions in Note 3 were determined to constitute business combinations and were accounted for under ASC 805. Purchase consideration includes assets transferred, liabilities assumed, and/or equity interests issued by us, all of which are measured at their fair value as of the date of acquisition. Our business combination transactions may be structured to include a combination of up-front, deferred and contingent payments. These payments may include a combination of cash and common stock. Deferred and contingent payments are made at specified dates subsequent to the date of acquisition. Deferred cash payments and stock issuances are included in the acquisition consideration based on their fair value as of the acquisition date. The fair value of these obligations is estimated based on the present value, as of the date of acquisition, of the anticipated future payments. The future payments are discounted using a rate that considers an estimate of the return expected by a market-participant and a measurement of the risk inherent in the cash flows, among other inputs. These deferred obligations are generally subject to adjustments specified in the underlying purchase agreement related to the seller’s indemnification obligations. Contingent cash payments are obligations to make future cash payments to the seller, the payment of which is contingent upon the achievement of stipulated operational or financial targets in the post-acquisition period. Contingent cash payments are included in the purchase consideration at their fair value as of the acquisition date. The fair value of these payments is estimated using a probability weighted discount model based on the achievement of the specified targets. The fair value of these liabilities is re-evaluated on a quarterly basis, and any change is reflected in the line “General and administrative” in the accompanying Condensed Consolidated Statements of Operations. These estimates are inherently uncertain and unpredictable. Unanticipated events and circumstances may occur that would affect the accuracy or validity of these estimates. The total purchase consideration is allocated to the assets acquired and liabilities assumed based on their estimated fair values. Any excess consideration is classified as goodwill. Acquired intangibles are recorded at their estimated fair value based on the income approach using market-based estimates. Acquired intangibles generally include developed product technologies, which are amortized over their useful life on a straight-line basis, and client relationships, which are amortized over their useful life proportionately to the expected discounted cash flows derived from the asset. When trade names acquired are not classified as indefinite-lived, they are amortized on a straight-line basis over their expected useful life. Acquisition costs are expensed as incurred and are included in the line “General and administrative” in the accompanying Condensed Consolidated Statements of Operations. We include the results of operations from acquired businesses in our Condensed Consolidated Financial Statements from the effective date of the acquisition. |
Derivative Financial Information | Derivative Financial Instruments We are exposed to interest rate risk related to our variable rate debt. We manage this risk through a program that includes the use of interest rate derivatives, the counterparties to which are major financial institutions. Our objective in using interest rate derivatives is to add stability to interest cost by reducing our exposure to interest rate movements. We do not use derivative instruments for trading or speculative purposes. Our interest rate derivatives are designated as cash flow hedges and are carried in the Condensed Consolidated Balance Sheets at their fair value. Unrealized gains and losses resulting from changes in the fair value of these instruments are classified as either effective or ineffective. The effective portion of such gains or losses is recorded as a component of accumulated other comprehensive income (“AOCI”), while the ineffective portion is recorded as a component of interest expense in the period of change. Amounts reported in AOCI related to interest rate derivatives are reclassified into interest expense as interest payments are made on our variable-rate debt. If an interest rate derivative agreement is terminated prior to its maturity, the amounts previously recorded in AOCI are recognized into earnings over the period that the forecasted transactions impact earnings. If the hedging relationship is discontinued because it is probable that the forecasted transactions will not occur according to our original strategy, any related amounts previously recorded in AOCI are recognized in earnings immediately. |
Accounts Receivable | Accounts Receivable Accounts receivable primarily represent trade receivables from clients that are recorded at the invoice amount, net of an allowance for doubtful accounts and credits. For certain transactions, we have met the requirements to recognize revenue in advance of invoicing the client. In these instances, we record unbilled receivables for the amount that will be due from the client upon invoicing. We maintain an allowance for doubtful accounts for credits we offer our clients in certain instances and to reflect our best estimate of the amount of consideration to which we are entitled and that we will ultimately receive. In evaluating the sufficiency of the allowance for doubtful accounts, we consider relevant factors such as our historical experience, current contractual requirements, potential client buying patterns, age of the outstanding balance, and our clients’ ability to pay. Any change in the assumptions used in analyzing a specific account receivable might result in an additional allowance for doubtful accounts being recognized in the period in which the change occurs. A portion of our allowance is for services not yet rendered and is therefore classified as an offset to deferred revenue. Accounts receivable are written off upon determination of non-collectability following established Company policies. We incurred bad debt expense of $1.5 million and $0.8 million for the three months ended , and $2.1 million and $1.3 million for the six months ended June 30, 2018 and 2017 , respectively. Accounts receivable includes commissions due to us related to the sale of insurance products to individuals and commissions which are contingent based upon the activity in the underlying policies. Contingent commissions receivables are recorded at their estimated net realizable value, based on estimates and considerations which include, but are not limited to, the historical and projected loss rates incurred by the underlying policies. |
Revenue Recognition | Deferred Revenue Deferred revenue primarily consists of billings issued or payments received for service obligations we have not yet completed. For several of our solutions, we invoice our clients in annual, monthly, or quarterly installments in advance of the commencement of the service period. Accordingly, the deferred revenue balance does not represent the total contract value of annual or multi-year, non-cancellable subscription agreements. Deferred revenue that will be recognized during the succeeding twelve-month period is recorded as current deferred revenue and the remaining portion is recorded as noncurrent. Revenue Recognition We derive our revenue from two primary sources: (1) on demand software solutions and (2) professional services and other goods and services. We recognize revenue as we satisfy one or more service obligations under the terms of a contract, generally as control of goods and services are transferred to our clients. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. We include estimates of variable consideration in revenue to the extent that it is probable that a significant reversal of cumulative revenue will not occur once the uncertainty is resolved. We determine revenue recognition through the following steps: • identification of the contract, or contracts, with a client; • 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. On Demand Revenue Our on demand revenue consists of license and subscription fees, transaction fees related to certain of our software-enabled value-added services, and commissions derived from our sales of certain risk mitigation services. We generally recognize revenue from subscription fees on a straight-line basis over the access period beginning on the date that we make our service available to the client. Our subscription agreements generally are non-cancellable, have an initial term of one year or longer and are billed either monthly or annually in advance. Recognition on subscription fees starts and is recorded when, or as, service obligations are satisfied. Non-refundable upfront fees billed at the initial order date that are not associated with an upfront service obligation are recognized as revenue on a straight-line basis over the period over which the client is expected to benefit, which we consider to be three years. We recognize revenue from transaction fees in the month the related services are performed based on the amount we have a right to invoice. As part of our resident services offerings, we offer risk mitigation services to our clients by acting as an insurance agent and derive commission revenue from the sale of insurance products to our clients’ residents. The commissions are based upon a percentage of the premium that our insurance company underwriting partners charge to the policyholder and are subject to forfeiture in instances where a policyholder cancels prior to the end of the policy. Our contracts with our underwriting partners also provide for contingent commissions to be paid to us in accordance with the agreements. Such commissions are variable in nature and based on a calculation that considers, on the policies sold by us, earned premiums less i) earned agent commissions; ii) a percent of premium retained by our underwriting partner; iii) incurred losses; and iv) profit retained by our underwriting partner during the time period. Our estimate of contingent commission revenue considers historical loss experience on the policies sold by us. If the policy is cancelled, our commissions are forfeited as a percent of the unearned premium. As a result, we recognize commissions related to these services as earned ratably over the policy term. Professional and Other Revenue Professional services and other revenues generally consist of the fees we receive for providing implementation and consulting services, submeter equipment and ongoing maintenance of our existing on premise licenses. Professional services are billed either on a fixed rate per hour (time) and materials basis or on a fixed price basis, and revenue is recognized over time as we perform the obligation. Professional services are typically sold bundled in a contract with other on demand solutions but may be sold separately. Professional service contracts sold separately generally have terms of one year or less. For bundled arrangements, where the Company accounts for individual services as a separate performance obligation, the transaction price is allocated between separate services in the bundle based on their relative standalone selling prices. Other revenues consist primarily of submeter equipment sales that include related installation services. Such sales are considered bundled, and revenue from these bundled sales is recognized in proportion to the number of fully installed units completed to date as compared to the total contracted number of units to be provided and installed. For all other equipment sales, we generally recognize revenue when control of the hardware has transferred to our client. Revenue recognized for on premise software sales generally consists of annual maintenance renewals on existing term or perpetual licenses, which is recognized ratably over the service period. Contracts with Multiple Performance Obligations The majority of the contracts we enter into with clients, including multiple contracts entered into at or near the same time with the same client, require us to provide one or more on demand software solutions, professional services and/or equipment. For these contracts, we account for individual performance obligations separately i) if they are distinct or ii) if the promised obligations represent a series of distinct services that are substantially the same and have the same pattern of transfer to the client. Once we determine the performance obligations, we determine the transaction price, which includes estimating the amount of variable consideration, if any, to be included in the transaction price. If the contract contains a single performance obligation, we allocate the entire transaction price to the single performance obligation. For contracts with multiple performance obligations, we allocate the transaction price to the separate performance obligations on a relative standalone selling price basis. The standalone selling prices of our services are typically estimated using a market assessment approach based on our overall pricing objectives taking into consideration market conditions and other factors including the number of solutions sold, client demographics, and the number and types of users within our contracts. Sales, value add, and other taxes we collect from clients and remit to governmental authorities are excluded from revenues. Reserves for Variable Consideration We recognize revenues from on demand and professional service sales at the net sales price (transaction price), which includes estimates of reserves we establish for credits we offer our clients in certain instances. These reserves are based on the amounts expected to be credited on the related sales and are classified as reductions of revenue and the related accounts receivable. Where appropriate, these estimates take into consideration relevant factors such as the Company’s historical experience, current contractual requirements, specific known market events and trends, and forecasted buying and payment patterns. These reserves reduce revenue to an amount that reflects the Company’s best estimates of the amount of consideration to which it is entitled and that it will ultimately receive based on the terms of the contract. The amount of variable consideration which is included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. If actual results in the future vary from the Company’s estimates, the Company will adjust these estimates, which will affect net revenue and earnings in the period such variances become known. |
Deferred Commissions | Deferred Commissions Sales commissions, including sales-based incentive payments, earned by our direct sales force are considered incremental and recoverable costs of obtaining a contract with a client. These costs are deferred in “Other current assets” and “Other assets” and amortized into “Sales and marketing expense” on a straight line basis over a period of benefit that we have determined to be three years. We determined the period of benefit by taking into consideration our client contracts, our technology, historical pricing practices and other factors. We periodically review these capitalized costs for impairment. |
Fair Value Measurements | Fair Value Measurements Certain assets and liabilities are carried at fair value under GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. |
Legal Contingencies | Legal Contingencies We review the status of each legal matter and record a provision for a liability when we consider that it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We review these provisions quarterly and make adjustments where needed as additional information becomes available. If either or both of the criteria are not met, we assess whether there is at least a reasonable possibility that a loss, or additional losses beyond those already accrued, may be incurred. If there is a reasonable possibility that a material loss (or additional material loss in excess of any accrual) may be incurred, we disclose an estimate of the amount of loss or range of losses, either individually or in the aggregate, as appropriate, if such an estimate can be made, or disclose that an estimate of loss cannot be made. |
Recently Adopted/Issued Accounting Standards | Recently Adopted Accounting Standards Accounting Standards Update 2014-09 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, as amended by certain supplementary ASU’s released in 2016, replaces all current GAAP guidance on this topic and eliminates all industry-specific guidance. The new revenue recognition standard requires the recognition of revenue when promised goods or services are transferred to clients in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 also includes Subtopic 340-40, Other Assets and Deferred Costs - Contracts with Customers , which requires the deferral of incremental costs of obtaining a contract with a client. Collectively, we refer to Topic 606 and Subtopic 340-40 as the “new revenue standard” or “ ASC 606 .” We adopted the requirements of the new revenue standard on January 1, 2018 using the modified retrospective method. We recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings at the beginning of 2018. Comparative information from prior year periods has not been restated and continues to be reported under the accounting standards in effect for those periods. The cumulative effects of the changes made to our condensed consolidated January 1, 2018 balance sheet for the adoption of the new revenue standard were as follows: Balance at December 31, 2017 Adjustments due to ASU 2014-09 Balance at (in thousands) Assets Accounts receivable, less allowance for doubtful accounts $ 124,505 $ (7,925 ) $ 116,580 Other current assets 6,622 2,771 9,393 Deferred tax assets, net 44,887 (780 ) 44,107 Other assets 11,010 4,459 15,469 Liabilities Current portion of deferred revenue 116,622 (3,696 ) 112,926 Stockholders’ Equity Accumulated deficit (75,046 ) 2,221 (72,825 ) Adoption of the new revenue standard resulted in changes to our accounting policies for revenue recognition, certain variable considerations, and commissions expense. The adoption of the new revenue standard did not have a significant effect on our revenue; however, it did have an impact on the timing of when we expense commission costs incurred to obtain a contract and the reserves we establish for variable consideration from credits or other pricing accommodations we provide our clients. We expect the effect of the new revenue standard to be immaterial to our revenue on an ongoing basis. The primary effect to our net income on an ongoing basis relates to the reserve for credit accommodations and deferral of incremental commission costs incurred to obtain new contracts. Under the new revenue standard, we accrue for credit accommodations in our reserve during the month of billing and credits reduce this reserve when issued. Further, we now initially defer commission costs and amortize these costs to expense over a period of benefit that we have determined to be three years. See Note 4 for additional required disclosures related to the impact of adopting the new revenue standard and our accounting for costs to obtain a contract . Accounting Standards Update 2016-18 In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows - Restricted Cash , which requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. This ASU must be adopted retrospectively. We adopted ASU 2016-18 effective January 1, 2018. As a result of our adoption, changes in customer deposits held in restricted accounts will result in an increase or reduction in our cash flows from operating activities. Under previous rules, such changes were largely offset by the corresponding change in restricted cash and had a minimal impact on our statement of cash flows. The prior period financial statements included in this filing have been adjusted to reflect the adoption of ASU 2016-18. The effects of those adjustments to the Condensed Consolidated Statements of Cash Flows have been summarized in the table below: Originally Reported Effect of Change As Adjusted (in thousands) Statement of Cash Flows for the six months ended June 30, 2017 Net cash provided by operating activities $ 80,464 $ 15,188 $ 95,652 Net cash used in investing activities (158,007 ) 7,637 (150,370 ) Cash, cash equivalents and restricted cash at end of period 324,591 106,479 431,070 Accounting Standards Update 2017-09 In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting , which provides clarification on when modification accounting should be used for changes to the terms or conditions of a share-based payment award. This ASU does not change the accounting for modifications but clarifies that modification accounting guidance should only be applied if there is a change to the fair value, vesting conditions, or award classification (as equity or liability) and would not be required if the changes are considered non-substantive. This new standard was effective for the Company on January 1, 2018. Adoption of ASU 2017-09 did not have a material impact on our consolidated financial statements. Accounting Standards Update 2017-01 In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business to assist entities with evaluating whether a set of transferred assets and activities (a "set") is a business . Under the new guidance, an entity first determines whether substantially all of the fair value of the set is concentrated in a single identifiable asset or a group of similar identifiable assets. If this threshold is met, the set is not a business. If the threshold is not met, the entity evaluates whether the set meets the requirements that a business include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. The provisions of this ASU became effective for the Company on January 1, 2018, and the adoption did not have a significant impact on our classification of businesses and complementary technologies acquired. Accounting Standards Update 2016-01 In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities and ASU 2018-03, Technical Corrections and Improvements to Financial Instruments - Overall (Subtopic 825-10) in February 2018, which provides clarification on certain guidance issued under ASU 2016-01. Among other things, ASU 2016-01 eliminates the cost method of accounting and requires that investments in equity securities that were previously accounted for under the cost method must now be measured at fair value, with changes in fair value recognized in net income. Equity instruments that do not have readily determinable fair values may be measured at cost less impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. This ASU became effective on January 1, 2018. The Company holds an investment which was accounted for under the cost method of accounting prior to January 1, 2018, which does not have a readily determinable fair value and has had no observable price change. Therefore, we continue to measure this investment at cost, less any impairment. The adoption of this standard did not have a material impact on our consolidated financial statements. Recently Issued Accounting Standards In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting , which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under this ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. ASU 2018-07 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted. The amendments in this ASU are to be applied through a cumulative-effect adjustment to retained earnings as of the first reporting period in which the ASU is effective. We are currently evaluating this ASU, but the adoption is not expected to have 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 , which provides companies the option to reclassify tax effects stranded in accumulated other comprehensive income as a result of the 2017 Tax Cuts and Jobs Act (“Tax Reform Act”) to retained earnings. ASU 2018-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within those fiscal years, and should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Reform Act is recognized. Early adoption is permitted. We are currently evaluating this ASU, but the adoption is not expected to have a material impact on our consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities , which expands an entity’s ability to apply hedge accounting for nonfinancial and financial risk components and allows for a simplified approach for fair value hedging of interest rate risk. Certain of the amendments in this ASU as they relate to cash flow hedges, eliminate the requirement to separately record hedge ineffectiveness currently in earnings. Instead, the entire change in the fair value of the hedging instrument is recorded in Other Comprehensive Income (“OCI”), and amounts deferred in OCI will be reclassified to earnings in the same income statement line item in which the earnings effect of the hedged item is reported. Additionally, this ASU simplifies the hedge documentation and effectiveness assessment requirements under the previous guidance. ASU 2017-12 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted. The changes in this ASU will be applied on a modified retrospective basis through a cumulative effect adjustment to the opening balance of retained earnings as of the initial application date. While we are continuing to assess all potential impacts of ASU 2017-12 on our consolidated financial statements, its most immediate effect will be the initial recognition of the entire change in the fair value of our interest rate swaps in other comprehensive income. Similar to our current treatment of the effective portion of a change in fair value, the ineffective portion will be reclassified into interest expense as interest payments are made on our variable rate debt. Under our current practice, the ineffective portion is initially recorded as a component of interest expense in the period of change. We have not yet selected an adoption date and do not expect the changes in the ASU to have a material impact on our consolidated financial statements. In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815) . The amendments of this ASU allow companies to exclude a down round feature when determining whether a financial instrument (or embedded conversion feature) is considered indexed to the entity’s own stock. As a result, financial instruments (or embedded conversion features) with down round features may no longer be required to be accounted for as derivative liabilities. A company will recognize the value of a down round feature only when it is triggered and the strike price has been adjusted downward. For equity-classified freestanding financial instruments, an entity will treat the value of the effect of the down round as a dividend and a reduction of income available to common shareholders in computing basic earnings per share. For convertible instruments with embedded conversion features containing down round provisions, entities will recognize the value of the down round as a beneficial conversion discount to be amortized to earnings. ASU 2017-11 is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted, and the guidance is to be applied using a full or modified retrospective approach. We are currently evaluating the impact of adopting ASU 2017-11 on our consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . The amendments in this ASU replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted in fiscal years beginning after December 15, 2018. The amendments in this ASU are to be applied through a cumulative-effect adjustment to retained earnings as of the first reporting period in which the ASU is effective. We have not yet selected a transition date and are currently evaluating the impact of adopting ASU 2016-13 on our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02 , Leases (Topic 842) . The new guidance requires lessees to recognize assets and liabilities arising from all leases with a lease term of more than 12 months, including those classified as operating leases under previous accounting guidance. It also requires disclosure of key information about leasing arrangements to increase transparency and comparability among organizations. ASU 2016-02 is effective for interim and annual periods beginning after December 15, 2018. Early adoption is permitted. In July 2018, the FASB approved an optional transition method to allow companies to initially account for the impact of the adoption with a cumulative-effect adjustment to the opening balance of retained earnings on January 1, 2019. This will eliminate the need to restate amounts presented prior to January 1, 2019. We will adopt the standard effective January 1, 2019, and we expect to elect this optional transition method, as well as certain practical expedients permitted under the transition guidance. We are in the process of assessing the population for the new standard and evaluating the impact to our consolidated financial statements. We continue to anticipate that the standard will have a material impact on our balance sheet, but do not expect a material impact to the income statement. The most significant impact will be from the recognition of right of use assets and lease liabilities for operating leases, while we expect our accounting for finance leases to remain substantially unchanged. |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | The effects of those adjustments to the Condensed Consolidated Statements of Cash Flows have been summarized in the table below: Originally Reported Effect of Change As Adjusted (in thousands) Statement of Cash Flows for the six months ended June 30, 2017 Net cash provided by operating activities $ 80,464 $ 15,188 $ 95,652 Net cash used in investing activities (158,007 ) 7,637 (150,370 ) Cash, cash equivalents and restricted cash at end of period 324,591 106,479 431,070 We adopted the requirements of the new revenue standard on January 1, 2018 using the modified retrospective method. We recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings at the beginning of 2018. Comparative information from prior year periods has not been restated and continues to be reported under the accounting standards in effect for those periods. The cumulative effects of the changes made to our condensed consolidated January 1, 2018 balance sheet for the adoption of the new revenue standard were as follows: Balance at December 31, 2017 Adjustments due to ASU 2014-09 Balance at (in thousands) Assets Accounts receivable, less allowance for doubtful accounts $ 124,505 $ (7,925 ) $ 116,580 Other current assets 6,622 2,771 9,393 Deferred tax assets, net 44,887 (780 ) 44,107 Other assets 11,010 4,459 15,469 Liabilities Current portion of deferred revenue 116,622 (3,696 ) 112,926 Stockholders’ Equity Accumulated deficit (75,046 ) 2,221 (72,825 ) In accordance with the new revenue standard requirements, the following tables summarize the effects of this new standard on selected unaudited line items within our Condensed Consolidated Statements of Operations and Balance Sheet: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 As reported Balances without adoption of ASU 2014-09 Effect of Change As reported Balances without adoption of ASU 2014-09 Effect of Change (in thousands) Revenue On demand $ 206,945 $ 207,421 $ (476 ) $ 400,245 $ 400,876 $ (631 ) Professional and other 9,307 8,676 631 17,308 16,095 1,213 Total revenue $ 216,252 $ 216,097 $ 155 $ 417,553 $ 416,971 $ 582 Operating expenses Sales and marketing $ 54,488 $ 56,785 $ 2,297 $ 104,729 $ 108,886 $ 4,157 Net income before income taxes $ 8,290 $ 5,838 $ 2,452 $ 18,890 $ 14,151 $ 4,739 Income tax (benefit) expense (189 ) (1,096 ) (907 ) (490 ) (2,243 ) (1,753 ) Net income $ 8,479 $ 6,934 $ 1,545 $ 19,380 $ 16,394 $ 2,986 Balances at June 30, 2018 - as reported Balances at June 30, 2018 without adoption of ASU 2014-09 Effect of Change (in thousands) Assets Accounts receivable, less allowance for doubtful accounts $ 112,484 $ 119,930 $ (7,446 ) Other current assets 15,812 11,085 4,727 Other assets 20,710 14,109 6,601 Liabilities Current portion of deferred revenue 111,238 115,161 (3,923 ) Deferred revenue 5,181 5,181 — |
Acquisitions (Tables)
Acquisitions (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Allocated Purchase Price | The allocation of each purchase price, including the effects of measurement period adjustments recorded as of June 30, 2018 , was as follows: Axiometrics AUM On-Site PEX LRO (Final) (Final) (Provisional) (Provisional) (Provisional) (in thousands) Restricted cash $ — $ 5,954 $ 3,458 $ — $ — Accounts receivable 1,620 2,409 4,718 107 4,498 Property, equipment, and software 400 319 789 8 1,507 Intangible assets: Developed product technologies 15,500 10,800 16,960 2,350 42,000 Client relationships 6,830 7,470 41,360 590 49,000 Trade names 3,200 208 7,000 160 666 Non-compete agreements — 3,920 — — — Goodwill 54,190 45,907 184,520 3,309 202,852 Other assets 273 850 826 78 475 Accounts payable and accrued liabilities (367 ) (2,150 ) (938 ) (242 ) (214 ) Client deposits held in restricted accounts — (5,954 ) (3,458 ) — — Deferred revenue (7,115 ) (321 ) (565 ) (221 ) (861 ) Other long-term liabilities (774 ) — — — — Deferred tax liability — — (1,240 ) (108 ) — Total purchase price $ 73,757 $ 69,412 $ 253,430 $ 6,031 $ 299,923 The preliminary allocation of the ClickPay purchase price is as follows, in thousands: Restricted cash $ 1,313 Accounts receivable 2,714 Property, equipment, and software 89 Intangible assets: Developed product technologies 29,100 Client relationships 20,700 Trade names 2,900 Goodwill 168,033 Other assets 489 Accounts payable and accrued liabilities (2,698 ) Client deposits held in restricted accounts (1,313 ) Deferred tax liability, net (4,430 ) Total purchase price $ 216,897 |
Pro Forma Financial Information | Three Months Ended June 30, Six Months Ended June 30, 2018 Pro Forma 2017 Pro Forma 2018 Pro Forma 2017 Pro Forma (unaudited) (in thousands, except per share amounts) Total revenue $ 218,259 $ 197,492 $ 427,145 $ 386,592 Net income 8,966 4,867 18,757 8,001 Net income per share: Basic $ 0.11 $ 0.06 $ 0.23 $ 0.10 Diluted $ 0.10 $ 0.06 $ 0.21 $ 0.10 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table presents our revenues disaggregated by major revenue source. Sales and usage-based taxes are excluded from revenues. Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 (in thousands) On demand Property management $ 46,523 $ 41,405 $ 91,842 $ 81,746 Resident services 85,330 64,860 162,507 125,829 Leasing and marketing 42,841 29,325 82,257 57,140 Asset optimization 32,251 19,137 63,639 36,225 Total on demand revenue 206,945 154,727 400,245 300,940 Professional and other 9,307 6,579 17,308 13,285 Total revenue $ 216,252 $ 161,306 $ 417,553 $ 314,225 |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | The effects of those adjustments to the Condensed Consolidated Statements of Cash Flows have been summarized in the table below: Originally Reported Effect of Change As Adjusted (in thousands) Statement of Cash Flows for the six months ended June 30, 2017 Net cash provided by operating activities $ 80,464 $ 15,188 $ 95,652 Net cash used in investing activities (158,007 ) 7,637 (150,370 ) Cash, cash equivalents and restricted cash at end of period 324,591 106,479 431,070 We adopted the requirements of the new revenue standard on January 1, 2018 using the modified retrospective method. We recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings at the beginning of 2018. Comparative information from prior year periods has not been restated and continues to be reported under the accounting standards in effect for those periods. The cumulative effects of the changes made to our condensed consolidated January 1, 2018 balance sheet for the adoption of the new revenue standard were as follows: Balance at December 31, 2017 Adjustments due to ASU 2014-09 Balance at (in thousands) Assets Accounts receivable, less allowance for doubtful accounts $ 124,505 $ (7,925 ) $ 116,580 Other current assets 6,622 2,771 9,393 Deferred tax assets, net 44,887 (780 ) 44,107 Other assets 11,010 4,459 15,469 Liabilities Current portion of deferred revenue 116,622 (3,696 ) 112,926 Stockholders’ Equity Accumulated deficit (75,046 ) 2,221 (72,825 ) In accordance with the new revenue standard requirements, the following tables summarize the effects of this new standard on selected unaudited line items within our Condensed Consolidated Statements of Operations and Balance Sheet: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 As reported Balances without adoption of ASU 2014-09 Effect of Change As reported Balances without adoption of ASU 2014-09 Effect of Change (in thousands) Revenue On demand $ 206,945 $ 207,421 $ (476 ) $ 400,245 $ 400,876 $ (631 ) Professional and other 9,307 8,676 631 17,308 16,095 1,213 Total revenue $ 216,252 $ 216,097 $ 155 $ 417,553 $ 416,971 $ 582 Operating expenses Sales and marketing $ 54,488 $ 56,785 $ 2,297 $ 104,729 $ 108,886 $ 4,157 Net income before income taxes $ 8,290 $ 5,838 $ 2,452 $ 18,890 $ 14,151 $ 4,739 Income tax (benefit) expense (189 ) (1,096 ) (907 ) (490 ) (2,243 ) (1,753 ) Net income $ 8,479 $ 6,934 $ 1,545 $ 19,380 $ 16,394 $ 2,986 Balances at June 30, 2018 - as reported Balances at June 30, 2018 without adoption of ASU 2014-09 Effect of Change (in thousands) Assets Accounts receivable, less allowance for doubtful accounts $ 112,484 $ 119,930 $ (7,446 ) Other current assets 15,812 11,085 4,727 Other assets 20,710 14,109 6,601 Liabilities Current portion of deferred revenue 111,238 115,161 (3,923 ) Deferred revenue 5,181 5,181 — |
Property, Equipment and Softw29
Property, Equipment and Software (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Property, Plant and Equipment [Abstract] | |
Components of Property, Equipment and Software | Property, equipment, and software consisted of the following at June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 (in thousands) Leasehold improvements $ 61,357 $ 59,179 Data processing and communications equipment 76,357 83,922 Furniture, fixtures, and other equipment 31,635 28,752 Software 118,735 107,924 Property, equipment, and software, gross 288,084 279,777 Less: Accumulated depreciation and amortization (142,744 ) (131,349 ) Property, equipment, and software, net $ 145,340 $ 148,428 |
Goodwill and Identified Intan30
Goodwill and Identified Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Change in Carrying Amount of Goodwill | Changes in the carrying amount of goodwill during the six months ended June 30, 2018 were as follows, in thousands: Balance as of December 31, 2017 $ 751,052 Goodwill acquired 168,033 Measurement period adjustments (300 ) Balance as of June 30, 2018 $ 918,785 |
Other Intangible Assets | Identified intangible assets consisted of the following at June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 Carrying Amount Accumulated Amortization Net Carrying Amount Accumulated Amortization Net (in thousands) Finite-lived intangible assets: Developed technologies $ 194,194 $ (88,434 ) $ 105,760 $ 164,640 $ (76,577 ) $ 88,063 Client relationships 234,418 (91,120 ) 143,298 213,728 (78,390 ) 135,338 Vendor relationships 5,650 (5,650 ) — 5,650 (5,650 ) — Trade names 20,406 (7,786 ) 12,620 17,556 (4,325 ) 13,231 Non-compete agreements 4,173 (1,000 ) 3,173 4,173 (605 ) 3,568 Total finite-lived intangible assets 458,841 (193,990 ) 264,851 405,747 (165,547 ) 240,200 Indefinite-lived intangible assets: Trade names 12,132 — 12,132 12,137 — 12,137 Total identified intangible assets $ 470,973 $ (193,990 ) $ 276,983 $ 417,884 $ (165,547 ) $ 252,337 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Principal outstanding, and unamortized debt issuance costs for the Term Loans, were as follows at June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 Term Loan Delayed Draw Term Loan Term Loan Delayed Draw Term Loan (in thousands) Principal outstanding $ 118,057 $ 195,000 $ 120,356 $ 198,750 Unamortized issuance costs (202 ) (754 ) (233 ) (821 ) Unamortized discount (161 ) (425 ) (185 ) (490 ) Carrying value $ 117,694 $ 193,821 $ 119,938 $ 197,439 |
Schedule of maturities of long-term debt | Future maturities of principal under the Term Loans are as follows for the years ending December 31, in thousands: Term Loans 2018 $ 8,066 2019 16,133 2020 28,232 2021 32,266 Thereafter 228,360 $ 313,057 |
Convertible Debt | The following table sets forth total interest expense related to the Convertible Notes for the three and six months ended June 30, 2018 and 2017 : Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 (in thousands) Contractual interest expense $ 1,294 $ 561 $ 2,588 $ 561 Amortization of debt discount 2,562 1,052 5,086 1,052 Amortization of debt issuance costs 328 134 651 134 $ 4,184 $ 1,747 $ 8,325 $ 1,747 The net carrying amount of the Convertible Notes at June 30, 2018 and December 31, 2017 , was as follows: June 30, 2018 December 31, 2017 (in thousands) Liability component: Principal amount $ 345,000 $ 345,000 Unamortized discount (51,471 ) (56,557 ) Unamortized debt issuance costs (6,621 ) (7,244 ) $ 286,908 $ 281,199 Equity component, net of issuance costs and deferred tax: $ 61,390 $ 61,390 |
Stock-based Expense (Tables)
Stock-based Expense (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Restricted Stock Activity | During the three and six months ended June 30, 2018 , the Company made the following grants of time-based restricted stock: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Vesting 163,766 978,444 Shares vest ratably over a period of twelve quarters beginning on the first day of the second calendar quarter immediately following the grant date. — 3,600 Shares fully vested on the first day of the calendar quarter immediately following the grant date. 33,846 33,846 Shares vest ratably over a period of four quarters beginning on the first day of the calendar quarter immediately following the grant date. During the six months ended June 30, 2018 , we granted 517,364 shares of restricted stock that become eligible to vest based on the achievement of certain market-based conditions, as described below: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Condition to Become Eligible to Vest — 129,341 After the grant date and prior to July 1, 2021, the average closing price per share of our common stock equals or exceeds $60.89 for twenty consecutive trading days. — 129,341 After the grant date and prior to July 1, 2021, the average closing price per share of our common stock equals or exceeds $66.98 for twenty consecutive trading days. — 129,341 After the grant date and prior to July 1, 2021, the average closing price per share of our common stock equals or exceeds $73.07 for twenty consecutive trading days. — 129,341 After the grant date and prior to July 1, 2021, the average closing price per share of our common stock equals or exceeds $85.24 for twenty consecutive trading days. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Minimum Annual Rental Commitments | At June 30, 2018 , minimum annual rental commitments under non-cancellable operating leases were as follows for the years ending December 31, in thousands: 2018 $ 8,085 2019 14,342 2020 11,829 2021 10,986 2022 9,336 Thereafter 46,121 $ 100,699 |
Net Income per Share (Tables)
Net Income per Share (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Calculation of Basic and Diluted Net Income Per Share | The following table presents the calculation of basic and diluted net income per share : Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 (in thousands, except per share amounts) Numerator: Net income $ 8,479 $ 6,213 $ 19,380 $ 14,408 Denominator: Basic: Weighted average common shares used in computing basic net income per share 85,124 79,018 83,156 78,642 Diluted: Add weighted average effect of dilutive securities: Stock options and restricted stock 2,474 2,907 2,310 3,002 Convertible Notes 2,116 — 1,720 — Contingently issuable shares in connection with ClickPay acquisition 291 — 146 — Weighted average common shares used in computing diluted net income per share 90,005 81,925 87,332 81,644 Net income per share: Basic $ 0.10 $ 0.08 $ 0.23 $ 0.18 Diluted $ 0.09 $ 0.08 $ 0.22 $ 0.18 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Inputs | Significant unobservable inputs used in the contingent consideration fair value measurements included the following at June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 Discount rates 16.5 % 16.3 % Volatility rates 25.0 % 24.0 % Risk free rate of return 2.2 % 1.6 % |
Schedule of fair value of assets and liabilities | The following tables disclose the assets and liabilities measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017 , by the fair value hierarchy levels as described above: Fair value at June 30, 2018 Total Level 1 Level 2 Level 3 (in thousands) Assets: Interest rate swap agreements $ 1,465 $ — $ 1,465 $ — Liabilities: Contingent consideration related to the acquisition of: Axiometrics 52 — — 52 Total liabilities measured at fair value $ 52 $ — $ — $ 52 Fair value at December 31, 2017 Total Level 1 Level 2 Level 3 (in thousands) Assets: Interest rate swap agreements $ 1,329 $ — $ 1,329 $ — Liabilities: Contingent consideration related to the acquisition of: AssetEye 247 — — 247 Axiometrics 167 — — 167 Total liabilities measured at fair value $ 414 $ — $ — $ 414 |
Schedule of change in level 3 fair values | Changes in the fair value of Level 3 measurements were as follows for the six months ended June 30, 2018 and 2017 : Six Months Ended June 30, 2018 2017 (in thousands) Balance at beginning of period $ 414 $ 541 Initial contingent consideration — 812 Settlements through cash payments (247 ) — Net (gain) loss on change in fair value (115 ) 41 Balance at end of period $ 52 $ 1,394 |
Schedule of Fair Value of Convertible Debt | The fair value and carrying value of the Term Loans and Convertible Notes were as follows at June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 Fair Value Carrying Value Fair Value Carrying Value (in thousands) Term Loans $ 303,280 $ 311,515 $ 303,806 $ 317,377 Convertible Notes 491,177 286,908 430,301 281,199 |
Derivative Financial Instrume36
Derivative Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Cash flow hedging derivatives on the Balance Sheet | The table below presents the notional and fair value of the Swap Agreements as well as their classification in the Condensed Consolidated Balance Sheets as of June 30, 2018 and December 31, 2017 : Balance Sheet Location Notional Fair Value (in thousands) Derivatives designated as cash flow hedging instruments: Swap agreements as of June 30, 2018 Other assets $ 75,000 $ 1,465 Swap agreements as of December 31, 2017 Other assets $ 75,000 $ 1,329 |
Gain (loss) on Derivatives | The tables below present the amount of gains and losses related to the effective and ineffective portions of the Swap Agreements and their location in the Condensed Consolidated Statements of Operations and the Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2018 and 2017 , in thousands: Effective Portion Ineffective Portion Derivatives Designated as Cash Flow Hedges Gain (Loss) Recognized in OCI Location of Gain (Loss) Recognized in Income Gain (Loss) Recognized in Income Location of Gain (Loss) Recognized in Income Gain (Loss) Recognized in Income Three months ended June 30, 2018: Swap agreements, net of tax $ 108 Interest expense and other $ 145 Interest expense and other $ (15 ) Three months ended June 30, 2017: Swap agreements, net of tax $ (21 ) Interest expense and other $ (3 ) Interest expense and other $ 10 Effective Portion Ineffective Portion Derivatives Designated as Cash Flow Hedges Gain (Loss) Recognized in OCI Location of Gain (Loss) Recognized in Income Gain (Loss) Recognized in Income Location of Gain (Loss) Recognized in Income Gain (Loss) Recognized in Income Six months ended June 30, 2018: Swap agreements, net of tax $ 367 Interest expense and other $ 244 Interest expense and other $ (31 ) Six months ended June 30, 2017: Swap agreements, net of tax $ 73 Interest expense and other $ 9 Interest expense and other $ 28 |
The Company - Narrative (Detail
The Company - Narrative (Details) $ in Millions | 1 Months Ended | 3 Months Ended |
May 31, 2018USD ($)Customer | Jun. 30, 2018USD ($) | |
Accounting Policies [Abstract] | ||
Client funds diverted | $ 6.2 | |
Number of clients impacted | Customer | 3 | |
Other Current Assets | ||
Loss Contingencies [Line Items] | ||
Receivable | $ 6.2 | |
General and Administrative Expense | ||
Loss Contingencies [Line Items] | ||
Non-recoverable expenses | $ 0.3 |
Summary of Significant Accoun38
Summary of Significant Accounting Policies - Additional Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2018USD ($)primary_source | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)primary_source | Jun. 30, 2017USD ($) | Jan. 01, 2018USD ($) | Dec. 31, 2017USD ($) | |
Schedule Of Significant Accounting Policies [Line Items] | ||||||
Property, equipment, and software, net | $ 145,340 | $ 145,340 | $ 148,428 | |||
Bad debt expense | $ 1,500 | $ 800 | $ 2,100 | $ 1,300 | ||
Primary sources of revenue | primary_source | 2 | 2 | ||||
Deferred tax assets, net | $ 42,607 | $ 42,607 | $ 44,107 | 44,887 | ||
Deferred commissions period of benefit | 3 years | 3 years | ||||
Length of Expected Customer Benefit of License Fees Billed at Initial Order Date | ||||||
Schedule Of Significant Accounting Policies [Line Items] | ||||||
Expected length of time of benefit from license fees | 3 years | |||||
United States | ||||||
Schedule Of Significant Accounting Policies [Line Items] | ||||||
Property, equipment, and software, net | $ 136,900 | $ 136,900 | 140,000 | |||
International Subsidiaries | ||||||
Schedule Of Significant Accounting Policies [Line Items] | ||||||
Property, equipment, and software, net | $ 8,400 | $ 8,400 | $ 8,400 | |||
Minimum | ||||||
Schedule Of Significant Accounting Policies [Line Items] | ||||||
Contract duration | 1 year |
Summary of Significant Accoun39
Summary of Significant Accounting Policies - Schedule of Adjustments Due to Change in Accounting Policy (Details) - USD ($) $ in Thousands | 6 Months Ended | |||||
Jun. 30, 2018 | Jun. 30, 2017 | Jan. 01, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | |
Assets | ||||||
Accounts receivable, less allowance for doubtful accounts | $ 112,484 | $ 116,580 | $ 124,505 | |||
Other current assets | 15,812 | 9,393 | 6,622 | |||
Deferred tax assets, net | 42,607 | 44,107 | 44,887 | |||
Other assets | 20,710 | 15,469 | 11,010 | |||
Liabilities | ||||||
Current portion of deferred revenue | 111,238 | 112,926 | 116,622 | |||
Stockholders’ equity: | ||||||
Accumulated deficit | (53,445) | (72,825) | (75,046) | |||
Statement of Cash Flows for the six months ended June 30, 2017 | ||||||
Net cash provided by operating activities | 102,220 | $ 95,652 | ||||
Net cash used in investing activities | (161,768) | (150,370) | ||||
Cash, cash equivalents and restricted cash at end of period | 475,692 | 431,070 | 165,345 | $ 431,070 | $ 188,540 | |
Previously Reported | ||||||
Statement of Cash Flows for the six months ended June 30, 2017 | ||||||
Net cash provided by operating activities | 80,464 | |||||
Net cash used in investing activities | (158,007) | |||||
Cash, cash equivalents and restricted cash at end of period | 324,591 | |||||
Adjustments due to accounting standards update 2016-18 | ||||||
Statement of Cash Flows for the six months ended June 30, 2017 | ||||||
Net cash provided by operating activities | 15,188 | |||||
Net cash used in investing activities | $ 7,637 | |||||
Cash, cash equivalents and restricted cash at end of period | $ 106,479 | |||||
Balances without adoption of ASU 2014-09 | ||||||
Assets | ||||||
Accounts receivable, less allowance for doubtful accounts | 124,505 | |||||
Other current assets | 6,622 | |||||
Deferred tax assets, net | 44,887 | |||||
Other assets | 11,010 | |||||
Liabilities | ||||||
Current portion of deferred revenue | 116,622 | |||||
Stockholders’ equity: | ||||||
Accumulated deficit | $ (75,046) | |||||
Balances without adoption of ASU 2014-09 | Adjustments due to ASU 2014-09 | ||||||
Assets | ||||||
Accounts receivable, less allowance for doubtful accounts | 119,930 | |||||
Other current assets | 11,085 | |||||
Other assets | 14,109 | |||||
Liabilities | ||||||
Current portion of deferred revenue | 115,161 | |||||
Effect of Change on Net Income Higher/(Lower) | Adjustments due to ASU 2014-09 | ||||||
Assets | ||||||
Accounts receivable, less allowance for doubtful accounts | (7,446) | (7,925) | ||||
Other current assets | 4,727 | 2,771 | ||||
Deferred tax assets, net | (780) | |||||
Other assets | 6,601 | 4,459 | ||||
Liabilities | ||||||
Current portion of deferred revenue | $ (3,923) | (3,696) | ||||
Stockholders’ equity: | ||||||
Accumulated deficit | $ 2,221 |
Acquisitions - 2018 Acquisition
Acquisitions - 2018 Acquisitions (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Apr. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Business Acquisition [Line Items] | |||||
Acquisition of businesses, net of cash and restricted cash acquired | $ 137,475 | $ 123,241 | |||
Value of common stock issued | 20,756 | $ 0 | |||
Goodwill | $ 918,785 | $ 918,785 | $ 751,052 | ||
ClickPay | |||||
Business Acquisition [Line Items] | |||||
Total purchase price | $ 216,900 | ||||
Acquisition of businesses, net of cash and restricted cash acquired | 138,800 | ||||
Cash acquired | $ 7,500 | ||||
Issuance of common stock for acquisition of ClickPay (in shares) | 682,688 | ||||
Deferred cash payment amount related to acquisition | $ 20,000 | ||||
Deferred cash obligations, net | 18,900 | ||||
Stock issued for acquisition | 23,600 | ||||
Fair value of put and call agreement | $ 23,300 | ||||
Percentage of holders retaining membership rights | 3.00% | 12.00% | 3.00% | ||
Accrued liability to noncontrolling interests | $ 2,800 | ||||
Shares issued to NovelPay membership holder (in shares) | 395,206 | ||||
Value of common stock issued | $ 20,800 | ||||
Goodwill | 168,033 | $ 168,033 | |||
Gross contractual amount of acquired receivables | $ 2,800 | ||||
Estimated uncollectable amount of acquired receivables | 100 | ||||
Acquisition costs | 1,400 | ||||
2018 Acquisitions | |||||
Business Acquisition [Line Items] | |||||
Deferred cash obligation | 20,000 | 20,000 | |||
Deferred cash obligation discount | $ 900 | $ 900 | |||
Common Stock | ClickPay | |||||
Business Acquisition [Line Items] | |||||
Value of common stock issued for ClickPay acquisition | $ 35,900 | ||||
Developed product technologies | ClickPay | |||||
Business Acquisition [Line Items] | |||||
Amortized useful life of acquired intangible assets | 7 years | ||||
Client relationships | ClickPay | |||||
Business Acquisition [Line Items] | |||||
Amortized useful life of acquired intangible assets | 10 years | ||||
Trade names | ClickPay | |||||
Business Acquisition [Line Items] | |||||
Amortized useful life of acquired intangible assets | 10 years |
Acquisitions - Allocated Purcha
Acquisitions - Allocated Purchase Price (Details) - USD ($) $ in Thousands | 1 Months Ended | |||||||
Apr. 30, 2018 | Oct. 31, 2017 | Sep. 30, 2017 | Feb. 28, 2017 | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Jan. 31, 2017 | |
Business Acquisition [Line Items] | ||||||||
Goodwill | $ 918,785 | $ 751,052 | ||||||
ClickPay | ||||||||
Business Acquisition [Line Items] | ||||||||
Restricted cash | 1,313 | |||||||
Accounts receivable | 2,714 | |||||||
Property, equipment, and software | 89 | |||||||
Goodwill | 168,033 | |||||||
Other assets | 489 | |||||||
Accounts payable and accrued liabilities | (2,698) | |||||||
Client deposits held in restricted accounts | (1,313) | |||||||
Deferred tax liability | (4,430) | |||||||
Total purchase price | 216,897 | |||||||
Total purchase price | $ 216,900 | |||||||
ClickPay | Developed product technologies | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 29,100 | |||||||
ClickPay | Client relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 20,700 | |||||||
ClickPay | Trade names | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 2,900 | |||||||
Axiometrics | ||||||||
Business Acquisition [Line Items] | ||||||||
Restricted cash | 0 | |||||||
Accounts receivable | 1,620 | |||||||
Property, equipment, and software | 400 | |||||||
Goodwill | 54,190 | $ 54,200 | ||||||
Other assets | 273 | |||||||
Accounts payable and accrued liabilities | (367) | |||||||
Client deposits held in restricted accounts | 0 | |||||||
Deferred revenue | (7,115) | |||||||
Other long-term liabilities | (774) | |||||||
Deferred tax liability | 0 | |||||||
Total purchase price | 73,757 | $ 73,800 | ||||||
Axiometrics | Developed product technologies | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 15,500 | |||||||
Axiometrics | Client relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 6,830 | |||||||
Axiometrics | Trade names | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 3,200 | |||||||
Axiometrics | Non-compete agreements | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 0 | |||||||
AUM | ||||||||
Business Acquisition [Line Items] | ||||||||
Restricted cash | 5,954 | |||||||
Accounts receivable | 2,409 | |||||||
Property, equipment, and software | 319 | |||||||
Goodwill | 45,907 | $ 45,900 | ||||||
Other assets | 850 | |||||||
Accounts payable and accrued liabilities | (2,150) | |||||||
Client deposits held in restricted accounts | (5,954) | |||||||
Deferred revenue | (321) | |||||||
Other long-term liabilities | 0 | |||||||
Deferred tax liability | 0 | |||||||
Total purchase price | 69,412 | $ 69,400 | ||||||
AUM | Developed product technologies | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 10,800 | |||||||
AUM | Client relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 7,470 | |||||||
AUM | Trade names | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 208 | |||||||
AUM | Non-compete agreements | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 3,920 | |||||||
On-Site | ||||||||
Business Acquisition [Line Items] | ||||||||
Restricted cash | 3,458 | |||||||
Accounts receivable | 4,718 | |||||||
Property, equipment, and software | 789 | |||||||
Goodwill | $ 184,500 | 184,520 | ||||||
Other assets | 826 | |||||||
Accounts payable and accrued liabilities | (938) | |||||||
Client deposits held in restricted accounts | (3,458) | |||||||
Deferred revenue | (565) | |||||||
Other long-term liabilities | 0 | |||||||
Deferred tax liability | (1,240) | |||||||
Total purchase price | 253,430 | |||||||
Total purchase price | $ 253,400 | |||||||
On-Site | Developed product technologies | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 16,960 | |||||||
On-Site | Client relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 41,360 | |||||||
On-Site | Trade names | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 7,000 | |||||||
On-Site | Non-compete agreements | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 0 | |||||||
PEX | ||||||||
Business Acquisition [Line Items] | ||||||||
Restricted cash | 0 | |||||||
Accounts receivable | 107 | |||||||
Property, equipment, and software | 8 | |||||||
Goodwill | $ 3,300 | 3,309 | ||||||
Other assets | 78 | |||||||
Accounts payable and accrued liabilities | (242) | |||||||
Client deposits held in restricted accounts | 0 | |||||||
Deferred revenue | (221) | |||||||
Other long-term liabilities | 0 | |||||||
Deferred tax liability | (108) | |||||||
Total purchase price | 6,031 | |||||||
Total purchase price | $ 6,000 | |||||||
PEX | Developed product technologies | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 2,350 | |||||||
PEX | Client relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 590 | |||||||
PEX | Trade names | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 160 | |||||||
PEX | Non-compete agreements | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 0 | |||||||
LRO | ||||||||
Business Acquisition [Line Items] | ||||||||
Restricted cash | 0 | |||||||
Accounts receivable | 4,498 | |||||||
Property, equipment, and software | 1,507 | |||||||
Goodwill | $ 202,900 | 202,852 | ||||||
Other assets | 475 | |||||||
Accounts payable and accrued liabilities | (214) | |||||||
Client deposits held in restricted accounts | 0 | |||||||
Deferred revenue | (861) | |||||||
Other long-term liabilities | 0 | |||||||
Deferred tax liability | 0 | |||||||
Total purchase price | 299,923 | |||||||
Total purchase price | $ 299,900 | |||||||
LRO | Developed product technologies | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 42,000 | |||||||
LRO | Client relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 49,000 | |||||||
LRO | Trade names | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | 666 | |||||||
LRO | Non-compete agreements | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets: | $ 0 |
Acquisitions - 2017 Acquisitio
Acquisitions - 2017 Acquisitions (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||||||
Oct. 31, 2017 | Sep. 30, 2017 | Aug. 31, 2017 | Jun. 30, 2017 | Feb. 28, 2017 | Jan. 31, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | |
Business Acquisition [Line Items] | ||||||||||||
Acquisition of businesses, net of cash and restricted cash acquired | $ 137,475 | $ 123,241 | ||||||||||
Goodwill | $ 918,785 | 918,785 | $ 751,052 | |||||||||
Gain (loss) recognized due to change in fair value of cash consideration | (1,124) | (1,024) | ||||||||||
Payments of acquisition-related consideration | 7,371 | 7,185 | ||||||||||
LRO | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total purchase price | $ 299,900 | |||||||||||
Cash paid | 298,000 | |||||||||||
Deferred cash payment amount related to acquisition | 1,600 | |||||||||||
Deferred cash obligations, net | 1,500 | |||||||||||
Liabilities assumed | 400 | |||||||||||
Goodwill | 202,900 | 202,852 | 202,852 | |||||||||
Gross contractual amount of acquired receivables | 4,700 | |||||||||||
Estimated uncollectable amount of acquired receivables | 200 | |||||||||||
Acquisition costs | $ 13,800 | |||||||||||
Reimbursable legal fees | 50.00% | |||||||||||
Total purchase price | 299,923 | 299,923 | ||||||||||
PEX | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total purchase price | $ 6,000 | |||||||||||
Acquisition of businesses, net of cash and restricted cash acquired | 5,100 | |||||||||||
Deferred cash payment amount related to acquisition | 1,000 | |||||||||||
Deferred cash obligations, net | 900 | |||||||||||
Goodwill | 3,300 | 3,309 | 3,309 | |||||||||
Acquisition costs | 400 | |||||||||||
Total purchase price | 6,031 | 6,031 | ||||||||||
Cash acquired | $ 100 | |||||||||||
Length of time for acquisition contingent cash payment to be made | 24 months | |||||||||||
On-Site | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total purchase price | $ 253,400 | |||||||||||
Acquisition of businesses, net of cash and restricted cash acquired | 225,300 | |||||||||||
Deferred cash payment amount related to acquisition | 29,600 | |||||||||||
Deferred cash obligations, net | $ 28,100 | |||||||||||
Length of time for acquisition deferred cash payment to be made | 12 months | |||||||||||
Goodwill | $ 184,500 | 184,520 | 184,520 | |||||||||
Gross contractual amount of acquired receivables | 5,600 | |||||||||||
Estimated uncollectable amount of acquired receivables | 900 | |||||||||||
Acquisition costs | 1,800 | |||||||||||
Total purchase price | 253,430 | 253,430 | ||||||||||
Cash acquired | $ 1,700 | |||||||||||
Length of time for acquisition contingent cash payment to be made | 36 months | |||||||||||
AUM | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Acquisition of businesses, net of cash and restricted cash acquired | $ 64,800 | |||||||||||
Deferred cash payment amount related to acquisition | 5,100 | |||||||||||
Deferred cash obligations, net | $ 4,600 | $ 4,600 | 4,600 | |||||||||
Length of time for acquisition deferred cash payment to be made | 4 years | |||||||||||
Goodwill | $ 45,900 | 45,907 | 45,900 | 45,907 | 45,900 | |||||||
Gross contractual amount of acquired receivables | 2,700 | 2,700 | 2,700 | |||||||||
Estimated uncollectable amount of acquired receivables | 300 | 300 | 300 | |||||||||
Acquisition costs | 300 | |||||||||||
Total purchase price | 69,400 | 69,412 | 69,400 | 69,412 | 69,400 | |||||||
Cash acquired | $ 100 | |||||||||||
Axiometrics | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Cash paid | $ 66,100 | |||||||||||
Deferred cash payment amount related to acquisition | 7,500 | |||||||||||
Deferred cash obligations, net | $ 6,900 | |||||||||||
Length of time for acquisition deferred cash payment to be made | 2 years | |||||||||||
Goodwill | $ 54,200 | 54,190 | 54,190 | |||||||||
Acquisition costs | 300 | |||||||||||
Total purchase price | $ 73,800 | 73,757 | 73,757 | |||||||||
Length of time for acquisition contingent cash payment to be made | 12 months | |||||||||||
Contingent cash obligation/payment | $ 5,000 | |||||||||||
Contingent consideration liability | $ 800 | |||||||||||
2017 Acquisitions | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Deferred cash payment amount related to acquisition | 6,000 | |||||||||||
Deferred cash obligation | 38,200 | 38,200 | 44,800 | |||||||||
Deferred cash obligation discount | 800 | 800 | 2,300 | |||||||||
Gain (loss) recognized due to change in fair value of cash consideration | 100 | 200 | ||||||||||
Developed product technologies | LRO | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 7 years | |||||||||||
Developed product technologies | PEX | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 7 years | |||||||||||
Developed product technologies | On-Site | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 5 years | |||||||||||
Developed product technologies | AUM | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 3 years | |||||||||||
Developed product technologies | Axiometrics | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 5 years | |||||||||||
Client relationships | LRO | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 10 years | |||||||||||
Client relationships | PEX | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 9 years | |||||||||||
Client relationships | On-Site | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 10 years | |||||||||||
Client relationships | AUM | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 10 years | |||||||||||
Client relationships | Axiometrics | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 10 years | |||||||||||
Trade names | LRO | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 2 years | |||||||||||
Trade names | PEX | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 6 years | |||||||||||
Trade names | On-Site | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 2 years | |||||||||||
Trade names | AUM | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 2 years | |||||||||||
Trade names | Axiometrics | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 3 years | |||||||||||
Non-compete agreements | AUM | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Amortized useful life of acquired intangible assets | 5 years | |||||||||||
Hart-Scott-Rodino Antitrust Improvements Act Review Process | LRO | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Acquisition costs | $ 10,700 | |||||||||||
Recurring | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Liabilities measured at fair value | 52 | 52 | 414 | |||||||||
Contingent Consideration | Recurring | Axiometrics | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Liabilities measured at fair value | 52 | 52 | 167 | |||||||||
Level 3 | Recurring | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Liabilities measured at fair value | 52 | 52 | 414 | |||||||||
Level 3 | Contingent Consideration | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Liabilities measured at fair value | $ 1,394 | 52 | $ 1,394 | 52 | $ 1,394 | 414 | $ 541 | |||||
Level 3 | Contingent Consideration | Recurring | Axiometrics | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Liabilities measured at fair value | 52 | 52 | 167 | |||||||||
Level 3 | Contingent Consideration | Recurring | 2017 Acquisitions | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Liabilities measured at fair value | $ 100 | $ 100 | $ 200 |
Acquisitions - Activity Prior t
Acquisitions - Activity Prior to 2017 (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Business Acquisition [Line Items] | |||||
Gain (loss) recognized due to change in fair value of cash consideration | $ (1,124,000) | $ (1,024,000) | |||
Acquisitions Prior To 2017 | |||||
Business Acquisition [Line Items] | |||||
Total deferred cash obligation | $ 2,700,000 | 2,700,000 | $ 4,400,000 | ||
Deferred cash payment amount related to acquisition | 1,800,000 | 7,000,000 | |||
Payments of contingent cash obligations | 200,000 | 500,000 | |||
Aggregate contingent cash obligations | 0 | 0 | $ 200,000 | ||
Gain (loss) recognized due to change in fair value of cash consideration | $ (100,000) | (100,000) | $ (200,000) | ||
2017 Acquisitions | |||||
Business Acquisition [Line Items] | |||||
Deferred cash payment amount related to acquisition | $ 6,000,000 | ||||
Gain (loss) recognized due to change in fair value of cash consideration | $ 100,000 | $ 200,000 |
Acquisitions - Pro Forma Financ
Acquisitions - Pro Forma Financial Information (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 | |
Business Combinations [Abstract] | ||||
Total revenue | $ 218,259 | $ 197,492 | $ 427,145 | $ 386,592 |
Net income | $ 8,966 | $ 4,867 | $ 18,757 | $ 8,001 |
Net income per share: | ||||
Basic and Diluted (in dollars per share) | $ 0.11 | $ 0.06 | $ 0.23 | $ 0.10 |
Business Acquisition, Pro Forma Earnings Per Share, Diluted | $ 0.10 | $ 0.06 | $ 0.21 | $ 0.10 |
Revenue Recognition - Narrative
Revenue Recognition - Narrative (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018USD ($)product_line | Jun. 30, 2018USD ($)product_line | Jan. 01, 2018USD ($) | Dec. 31, 2017USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative effect of adoption of ASU 2014-09 | $ 2,221,000 | |||
Number of product lines | product_line | 4 | 4 | ||
Contract term | 1 year | 1 year | ||
On demand | $ 86,700,000 | |||
Deferred commissions period of benefit | 3 years | 3 years | ||
Current capitalized commissions cost | $ 4,700,000 | $ 4,700,000 | ||
Noncurrent capitalized commissions cost | 6,600,000 | 6,600,000 | ||
Amortized commission costs | 1,000,000 | $ 1,800,000 | ||
Capitalized commissions impairment loss | $ 0 | |||
Remaining performance obligation percentage | 75.00% | 75.00% | ||
Period for satisfying 75% of remaining obligation | 24 months | |||
Accumulated Deficit | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative effect of adoption of ASU 2014-09 | 2,221,000 | |||
Accumulated Deficit | Adjustments due to ASU 2014-09 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative effect of adoption of ASU 2014-09 | $ 2,200,000 | |||
Revenue from Contract with Customer | Adjustments due to ASU 2014-09 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative effect of adoption of ASU 2014-09 | $ 0 | $ 0 | ||
Minimum | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Contract term | 2 years | 2 years | ||
Maximum | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Contract term | 7 years | 7 years | ||
Professional Service | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Remaining performance obligation | $ 0 | $ 0 | ||
Professional Service | Maximum | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Contract term | 1 year | 1 year | ||
On demand | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Contract term | 1 year | 1 year | ||
Remaining performance obligation | $ 365,300,000 | $ 365,300,000 | ||
On demand | Minimum | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Contract term | 1 year | 1 year | ||
Effect of Change on Net Income Higher/(Lower) | Accumulated Deficit | Adjustments due to ASU 2014-09 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative effect of adoption of ASU 2014-09 | $ 800,000 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (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] | ||||
Total revenue | $ 216,252 | $ 161,306 | $ 417,553 | $ 314,225 |
Property Management | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 46,523 | 41,405 | 91,842 | 81,746 |
Resident Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 85,330 | 64,860 | 162,507 | 125,829 |
Leasing And Marketing | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 42,841 | 29,325 | 82,257 | 57,140 |
Asset Optimization | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 32,251 | 19,137 | 63,639 | 36,225 |
On demand | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 206,945 | 154,727 | 400,245 | 300,940 |
Professional and other | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 9,307 | $ 6,579 | $ 17,308 | $ 13,285 |
Revenue Recognition - Effect of
Revenue Recognition - Effect of Adoption of 2014-09 on Financial Statements (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 | Jan. 01, 2018 | Dec. 31, 2017 | |
Revenue | ||||||
Total revenue | $ 216,252 | $ 161,306 | $ 417,553 | $ 314,225 | ||
Operating expenses: | ||||||
Sales and marketing | 54,488 | 39,235 | 104,729 | 74,382 | ||
Net income (loss) for period | 8,290 | 3,081 | 18,890 | 12,087 | ||
Income tax benefit | (189) | (3,132) | (490) | (2,321) | ||
Net income | $ 8,479 | $ 6,213 | $ 19,380 | $ 14,408 | ||
Net income per share: | ||||||
Basic (in dollars per share) | $ 0.10 | $ 0.08 | $ 0.23 | $ 0.18 | ||
Diluted (in dollars per share) | $ 0.09 | $ 0.08 | $ 0.22 | $ 0.18 | ||
Assets | ||||||
Accounts receivable, less allowance for doubtful accounts | $ 112,484 | $ 112,484 | $ 116,580 | $ 124,505 | ||
Other current assets | 15,812 | 15,812 | 9,393 | 6,622 | ||
Other assets | 20,710 | 20,710 | 15,469 | 11,010 | ||
Liabilities | ||||||
Current portion of deferred revenue | 111,238 | 111,238 | 112,926 | 116,622 | ||
Deferred revenue | 5,181 | 5,181 | 5,538 | |||
Balances without adoption of ASU 2014-09 | ||||||
Assets | ||||||
Accounts receivable, less allowance for doubtful accounts | 124,505 | |||||
Other current assets | 6,622 | |||||
Other assets | 11,010 | |||||
Liabilities | ||||||
Current portion of deferred revenue | $ 116,622 | |||||
Balances without adoption of ASU 2014-09 | Adjustments due to ASU 2014-09 | ||||||
Operating expenses: | ||||||
Sales and marketing | 56,785 | 108,886 | ||||
Net income (loss) for period | 5,838 | 14,151 | ||||
Income tax benefit | (1,096) | (2,243) | ||||
Net income | $ 6,934 | $ 16,394 | ||||
Net income per share: | ||||||
Basic (in dollars per share) | $ 0.08 | $ 0.20 | ||||
Diluted (in dollars per share) | $ 0.08 | $ 0.19 | ||||
Assets | ||||||
Accounts receivable, less allowance for doubtful accounts | $ 119,930 | $ 119,930 | ||||
Other current assets | 11,085 | 11,085 | ||||
Other assets | 14,109 | 14,109 | ||||
Liabilities | ||||||
Current portion of deferred revenue | 115,161 | 115,161 | ||||
Deferred revenue | 5,181 | 5,181 | ||||
Effect of Change on Net Income Higher/(Lower) | Adjustments due to ASU 2014-09 | ||||||
Operating expenses: | ||||||
Sales and marketing | 2,297 | 4,157 | ||||
Net income (loss) for period | 2,452 | 4,739 | ||||
Income tax benefit | (907) | (1,753) | ||||
Net income | 1,545 | 2,986 | ||||
Assets | ||||||
Accounts receivable, less allowance for doubtful accounts | (7,446) | (7,446) | (7,925) | |||
Other current assets | 4,727 | 4,727 | 2,771 | |||
Other assets | 6,601 | 6,601 | 4,459 | |||
Liabilities | ||||||
Current portion of deferred revenue | (3,923) | (3,923) | $ (3,696) | |||
Deferred revenue | 0 | 0 | ||||
On demand | ||||||
Revenue | ||||||
Total revenue | 206,945 | $ 154,727 | 400,245 | $ 300,940 | ||
On demand | Balances without adoption of ASU 2014-09 | Adjustments due to ASU 2014-09 | ||||||
Revenue | ||||||
Total revenue | 207,421 | 400,876 | ||||
On demand | Effect of Change on Net Income Higher/(Lower) | Adjustments due to ASU 2014-09 | ||||||
Revenue | ||||||
Total revenue | (476) | (631) | ||||
Professional and other | ||||||
Revenue | ||||||
Total revenue | 9,307 | 6,579 | 17,308 | 13,285 | ||
Professional and other | Balances without adoption of ASU 2014-09 | Adjustments due to ASU 2014-09 | ||||||
Revenue | ||||||
Total revenue | 8,676 | 16,095 | ||||
Professional and other | Effect of Change on Net Income Higher/(Lower) | Adjustments due to ASU 2014-09 | ||||||
Revenue | ||||||
Total revenue | 631 | 1,213 | ||||
Service | ||||||
Revenue | ||||||
Total revenue | 216,252 | $ 161,306 | 417,553 | $ 314,225 | ||
Service | Balances without adoption of ASU 2014-09 | Adjustments due to ASU 2014-09 | ||||||
Revenue | ||||||
Total revenue | 216,097 | 416,971 | ||||
Service | Effect of Change on Net Income Higher/(Lower) | Adjustments due to ASU 2014-09 | ||||||
Revenue | ||||||
Total revenue | $ 155 | $ 582 |
Property, Equipment and Softw48
Property, Equipment and Software - Components of Property, Equipment and Software (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Line Items] | ||
Property, equipment, and software, gross | $ 288,084 | $ 279,777 |
Less: Accumulated depreciation and amortization | (142,744) | (131,349) |
Property, equipment, and software, net | 145,340 | 148,428 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, equipment, and software, gross | 61,357 | 59,179 |
Data processing and communications equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, equipment, and software, gross | 76,357 | 83,922 |
Furniture, fixtures, and other equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, equipment, and software, gross | 31,635 | 28,752 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Property, equipment, and software, gross | $ 118,735 | $ 107,924 |
Property, Equipment and Softw49
Property, Equipment and Software - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||||
Depreciation and amortization expense for property, equipment and software | $ 7.5 | $ 6.9 | $ 14.4 | $ 13.5 | |
Carrying amount of capitalized software development costs | 83.2 | 83.2 | $ 73.4 | ||
Accumulated depreciation of capitalized software development costs | (33.4) | (33.4) | $ (27.8) | ||
Software | |||||
Property, Plant and Equipment [Line Items] | |||||
Depreciation and amortization expense for property, equipment and software | $ 3 | $ 1.8 | $ 5.5 | $ 3.4 |
Goodwill and Identified Intan50
Goodwill and Identified Intangible Assets - Change in Carrying Amount of Goodwill (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 751,052 |
Goodwill acquired | 168,033 |
Measurement period adjustments | (300) |
Ending balance | $ 918,785 |
Goodwill and Identified Intan51
Goodwill and Identified Intangible Assets - Identified Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Finite-Lived Intangible Assets [Line Items] | ||
Carrying Amount | $ 458,841 | $ 405,747 |
Accumulated Amortization | (193,990) | (165,547) |
Finite-lived intangible assets, net | 264,851 | 240,200 |
Total intangible assets, carrying amount | 470,973 | 417,884 |
Total identified intangible assets, net | 276,983 | 252,337 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 12,132 | 12,137 |
Developed technologies | ||
Finite-Lived Intangible Assets [Line Items] | ||
Carrying Amount | 194,194 | 164,640 |
Accumulated Amortization | (88,434) | (76,577) |
Finite-lived intangible assets, net | 105,760 | 88,063 |
Client relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Carrying Amount | 234,418 | 213,728 |
Accumulated Amortization | (91,120) | (78,390) |
Finite-lived intangible assets, net | 143,298 | 135,338 |
Vendor relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Carrying Amount | 5,650 | 5,650 |
Accumulated Amortization | (5,650) | (5,650) |
Finite-lived intangible assets, net | 0 | 0 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Carrying Amount | 20,406 | 17,556 |
Accumulated Amortization | (7,786) | (4,325) |
Finite-lived intangible assets, net | 12,620 | 13,231 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Carrying Amount | 4,173 | 4,173 |
Accumulated Amortization | (1,000) | (605) |
Finite-lived intangible assets, net | $ 3,173 | $ 3,568 |
Goodwill and Identified Intan52
Goodwill and Identified Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of intangible assets | $ 14.7 | $ 6.5 | $ 28.5 | $ 12.6 |
Debt - Narrative (Details)
Debt - Narrative (Details) | Jun. 30, 2020USD ($) | Jun. 30, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($) | May 23, 2017USD ($)$ / sharesshares | Feb. 29, 2016USD ($) | Jun. 30, 2018USD ($)$ / sharesconsecutivetradingdaystradingdaysshares | Jun. 30, 2018USD ($)$ / sharesconsecutivetradingdaystradingdaysincreaseshares | Jun. 30, 2017USD ($) | Mar. 12, 2018USD ($) | Dec. 05, 2017USD ($) | May 31, 2017USD ($) | Sep. 30, 2014USD ($) |
Line of Credit Facility [Line Items] | ||||||||||||
Carrying value | $ 313,057,000 | $ 313,057,000 | $ 313,057,000 | |||||||||
Ratio of indebtedness | 3.75 | 3.75 | 3.75 | |||||||||
Covenant, interest coverage ratio | 3 | 3 | 3 | |||||||||
Revolving line of credit facility, available borrowing capacity | $ 350,000,000 | $ 350,000,000 | $ 350,000,000 | |||||||||
Proceeds from borrowings on convertible notes | 0 | $ 345,000,000 | ||||||||||
Convertible notes, net | $ 0 | $ 281,199,000 | $ 0 | 0 | ||||||||
Common stock warrants (in shares) | shares | 8,200,000 | |||||||||||
Purchases of convertible note hedges | $ 62,500,000 | |||||||||||
Proceeds from issuance of warrants | $ 31,500,000 | $ 0 | $ 31,499,000 | |||||||||
Warrants strike price (in dollars per share) | $ / shares | $ 57.58 | |||||||||||
Number of warrants exercised (in shares) | shares | 0 | 0 | 0 | |||||||||
Maximum | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Common stock warrants (in shares) | shares | 8,200,000 | |||||||||||
Revolving Facility | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Line of credit facility, maximum borrowing capacity | $ 350,000,000 | $ 350,000,000 | $ 350,000,000 | |||||||||
Line of credit facility, additional borrowing capacity | 150,000,000 | 150,000,000 | 150,000,000 | $ 150,000,000 | ||||||||
Debt issuance costs | $ 1,100,000 | |||||||||||
Revolving line of credit outstanding borrowings | 50,000,000 | 0 | 50,000,000 | 50,000,000 | ||||||||
Revolving line of credit facility, available borrowing capacity | 350,000,000 | 350,000,000 | 350,000,000 | |||||||||
Unamortized debt issuance costs | $ (1,500,000) | (600,000) | $ (1,500,000) | $ (1,500,000) | ||||||||
Revolving Facility | Maximum | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Ratio of indebtedness | 3.5 | 3.5 | 3.5 | |||||||||
Revolving Facility | LIBOR | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Basis spread on interest rate | 1.00% | |||||||||||
Revolving Facility | LIBOR | Minimum | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Basis spread on interest rate | 1.25% | |||||||||||
Revolving Facility | LIBOR | Maximum | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Basis spread on interest rate | 2.25% | |||||||||||
Revolving Facility | Federal Funds Rate | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Basis spread on interest rate | 0.50% | |||||||||||
Revolving Facility | Base Rate | Minimum | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Basis spread on interest rate | 0.25% | |||||||||||
Revolving Facility | Base Rate | Maximum | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Basis spread on interest rate | 1.25% | |||||||||||
Letters of credit | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Line of credit facility, maximum borrowing capacity | $ 350,000,000 | |||||||||||
Sub limit for issuance of letters of credit | 10,000,000 | |||||||||||
Swingline Loan | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Sub limit for issuance of letters of credit | $ 20,000,000 | |||||||||||
Line of Credit | Revolving Facility | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Revolving line of credit outstanding borrowings | 0 | |||||||||||
Convertible Senior Notes | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Proceeds from borrowings on convertible notes | $ 304,200,000 | |||||||||||
Delayed Draw Term Loan | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Periodic payment | $ 1,500,000 | $ 800,000 | ||||||||||
Revolving line of credit facility, available borrowing capacity | $ 0 | $ 0 | $ 0 | |||||||||
Delayed Draw Term Loan | Line of Credit | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Line of credit facility, maximum borrowing capacity | $ 125,000,000 | |||||||||||
Delayed Draw Term Loan | Line of Credit | Base Rate | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Ratio of indebtedness | 5 | 5 | 5 | |||||||||
Delayed Draw Term Loan | Term Loan | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Carrying value | $ 193,821,000 | 197,439,000 | $ 193,821,000 | $ 193,821,000 | $ 200,000,000 | |||||||
Periodic principal payment | $ 2,500,000 | 1,300,000 | ||||||||||
Seventh Amendment | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Ratio of indebtedness | 4.25 | 4.25 | 4.25 | |||||||||
Seventh Amendment | Line of Credit | Base Rate | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Ratio of indebtedness | 5.50 | 5.50 | 5.50 | |||||||||
Debt covenant consolidated net leverage ratio number of times allowable increase allowed over consecutive 24 month period | increase | 1 | |||||||||||
Debt covenant measurement period | 24 months | |||||||||||
Debt covenant allowable duration of net coverage ratio increase | 9 months | |||||||||||
Seventh Amendment | Convertible Debt | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Principal amount | $ 150,000,000 | $ 150,000,000 | $ 150,000,000 | |||||||||
Debt covenant measurement period | 24 months | |||||||||||
Debt covenant, acquisition floor for one time leverage extension | 150,000,000 | 150,000,000 | $ 150,000,000 | |||||||||
Debt covenant consolidated senior secured net leverage ratio number of times allowable increase allowed over consecutive 24 month period | increase | 1 | |||||||||||
Convertible Senior Notes Due November 2022 | Convertible Senior Notes | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt issuance costs | $ 9,800,000 | |||||||||||
Principal amount | $ 345,000,000 | 345,000,000 | $ 345,000,000 | $ 345,000,000 | $ 345,000,000 | |||||||
Interest rate stated percentage | 1.50% | |||||||||||
Effective interest rate of the liability component | 5.87% | 5.87% | 5.87% | 5.87% | ||||||||
Conversion rate, convertible notes | 0.02384 | |||||||||||
Conversion price (in dollars per share) | $ / shares | $ 41.95 | |||||||||||
Long-term debt fair value | $ 108,200,000 | |||||||||||
Threshold trading days | tradingdays | 20 | 20 | ||||||||||
Threshold consecutive trading days | consecutivetradingdays | 30 | 30 | ||||||||||
Measurement period threshold trading days | tradingdays | 5 | |||||||||||
Measurement period threshold consecutive trading days | consecutivetradingdays | 5 | |||||||||||
Redemption price (percentage) | 100.00% | |||||||||||
Convertible notes, net | 286,908,000 | 281,199,000 | $ 286,908,000 | $ 286,908,000 | 282,500,000 | |||||||
Carrying amount of convertible debt equity component | $ 61,390,000 | $ 61,390,000 | $ 61,390,000 | $ 61,390,000 | $ 62,500,000 | |||||||
Convertible Senior Notes Due November 2022 | Convertible Senior Notes | Minimum | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Threshold percentage of stock price trigger | 130.00% | 130.00% | ||||||||||
Ratio of trading price per $1000 principle amount | 98.00% | |||||||||||
Percentage of debt held by individual owner | 25.00% | |||||||||||
Over-Allotment Option | Convertible Senior Notes | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Principal amount | $ 45,000,000 | |||||||||||
Scenario, Forecast | Delayed Draw Term Loan | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Periodic payment | $ 3,100,000 | |||||||||||
Scenario, Forecast | Delayed Draw Term Loan | Term Loan | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Periodic principal payment | $ 5,000,000 | |||||||||||
Share Price | Convertible Senior Notes Due November 2022 | Convertible Senior Notes | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Debt instrument measurement input | $ / shares | 55.10 | 55.10 | 55.10 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Dec. 05, 2017 |
Debt Instrument [Line Items] | |||
Carrying value | $ 313,057 | ||
Term Loan | |||
Debt Instrument [Line Items] | |||
Principal outstanding | 118,057 | $ 120,356 | |
Unamortized discount | (202) | (233) | |
Unamortized debt issuance costs | (161) | (185) | |
Carrying value | 117,694 | 119,938 | |
Term Loan | Delayed Draw Term Loan | |||
Debt Instrument [Line Items] | |||
Principal outstanding | 195,000 | 198,750 | |
Unamortized discount | (754) | (821) | |
Unamortized debt issuance costs | (425) | (490) | |
Carrying value | $ 193,821 | $ 197,439 | $ 200,000 |
Debt - Debt Maturities (Details
Debt - Debt Maturities (Details) $ in Thousands | Jun. 30, 2018USD ($) |
Debt Disclosure [Abstract] | |
2,018 | $ 8,066 |
2,019 | 16,133 |
2,020 | 28,232 |
2,021 | 32,266 |
Thereafter | 228,360 |
Total | $ 313,057 |
Debt - Convertible Debt (Detail
Debt - Convertible Debt (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | May 31, 2017 | May 23, 2017 | |
Convertible Debt [Abstract] | |||||||
Convertible notes payable, net | $ 0 | $ 0 | $ 281,199,000 | ||||
Convertible Senior Notes | Convertible Senior Notes Due November 2022 | |||||||
Convertible Debt [Abstract] | |||||||
Principal amount | 345,000,000 | 345,000,000 | 345,000,000 | $ 345,000,000 | |||
Unamortized discount | (51,471,000) | (51,471,000) | (56,557,000) | ||||
Unamortized debt issuance costs | (6,621,000) | (6,621,000) | (7,244,000) | ||||
Convertible notes payable, net | 286,908,000 | 286,908,000 | 281,199,000 | $ 282,500,000 | |||
Equity component | 61,390,000 | 61,390,000 | $ 61,390,000 | $ 62,500,000 | |||
Interest Expense, Debt [Abstract] | |||||||
Contractual interest expense | 1,294,000 | $ 561,000 | 2,588,000 | $ 561,000 | |||
Amortization of debt discount | 2,562,000 | 1,052,000 | 5,086,000 | 1,052,000 | |||
Amortization of debt issuance costs | 328,000 | 134,000 | 651,000 | 134,000 | |||
Interest expense, net | $ 4,184,000 | $ 1,747,000 | $ 8,325,000 | $ 1,747,000 |
Stock-based Expense - Schedule
Stock-based Expense - Schedule of Stock-based Expense (Details) - $ / shares | 3 Months Ended | 6 Months Ended |
Jun. 30, 2018 | Jun. 30, 2018 | |
Restricted Stock | Vesting condition 4 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted shares of restricted stock (in shares) | 0 | 129,341 |
Performance-Based Restricted Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted shares of restricted stock (in shares) | 517,364 | |
Performance-Based Restricted Stock | Vesting condition 1 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted shares of restricted stock (in shares) | 0 | 129,341 |
Number of consecutive trading days required to calculate average price per share (in days) | 20 days | |
Minimum price per common stock for vesting eligibility (in dollars per share) | $ 60.89 | |
Performance-Based Restricted Stock | Vesting condition 2 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted shares of restricted stock (in shares) | 0 | 129,341 |
Number of consecutive trading days required to calculate average price per share (in days) | 20 days | |
Minimum price per common stock for vesting eligibility (in dollars per share) | $ 66.98 | |
Performance-Based Restricted Stock | Vesting condition 3 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted shares of restricted stock (in shares) | 0 | 129,341 |
Number of consecutive trading days required to calculate average price per share (in days) | 20 days | |
Minimum price per common stock for vesting eligibility (in dollars per share) | $ 73.07 | |
Performance-Based Restricted Stock | Vesting condition 4 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of consecutive trading days required to calculate average price per share (in days) | 20 days | |
Minimum price per common stock for vesting eligibility (in dollars per share) | $ 85.24 | |
2010 Equity Incentive Plan | Restricted Stock | Vesting condition 1 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted shares of restricted stock (in shares) | 163,766 | 978,444 |
Vesting period (in years) | 3 years | |
2010 Equity Incentive Plan | Restricted Stock | Vesting condition 2 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted shares of restricted stock (in shares) | 0 | 3,600 |
Vesting period (in years) | 1 year | |
2010 Equity Incentive Plan | Restricted Stock | Vesting condition 3 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted shares of restricted stock (in shares) | 33,846 | 33,846 |
Stock-based Expense Narrative (
Stock-based Expense Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2018 | Jun. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based expense | $ (0.4) | $ (0.5) |
Performance-Based Restricted Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted shares of restricted stock (in shares) | 517,364 |
Commitments and Contingencies -
Commitments and Contingencies - Minimum Annual Rental Payments (Details) $ in Thousands | Jun. 30, 2018USD ($) |
Minimum Lease Payments | |
2,018 | $ 8,085 |
2,019 | 14,342 |
2,020 | 11,829 |
2,021 | 10,986 |
2,022 | 9,336 |
Thereafter | 46,121 |
Total Minimum Lease Payments | $ 100,699 |
Net Income per Share - Addition
Net Income per Share - Additional Information (Details) - $ / shares | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | May 23, 2017 | |
Earnings Per Share [Abstract] | |||||
Shares excluded from dilutive shares outstanding because their effect was anti-dilutive (in shares) | (78,968) | (27,422) | (322,234) | (362,522) | |
Warrants strike price (in dollars per share) | $ 57.58 | ||||
ClickPay | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Contingently issuable shares (in shares) | 187,480 |
Net Income per Share - Calculat
Net Income per Share - Calculation of Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Numerator: | ||||
Net income | $ 8,479 | $ 6,213 | $ 19,380 | $ 14,408 |
Basic: | ||||
Weighted average common shares used in computing basic net income (loss) per share (in shares) | 85,124 | 79,018 | 83,156 | 78,642 |
Add weighted average effect of dilutive securities: | ||||
Stock options and restricted stock (in shares) | 2,474 | 2,907 | 2,310 | 3,002 |
Convertible notes (in shares) | 2,116 | 0 | 1,720 | 0 |
Shares held in escrow in connection with ClickPay acquisition (in shares) | 291 | 0 | 146 | 0 |
Weighted average common shares used in computing diluted net income (loss) per share (in shares) | 90,005 | 81,925 | 87,332 | 81,644 |
Net income per share: | ||||
Basic (in dollars per share) | $ 0.10 | $ 0.08 | $ 0.23 | $ 0.18 |
Diluted (in dollars per share) | $ 0.09 | $ 0.08 | $ 0.22 | $ 0.18 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jan. 01, 2018 | Dec. 31, 2017 | |
Schedule Of Income Taxes [Line Items] | ||||
Effective income tax rate reconciliation (percent) | (2.60%) | (19.20%) | ||
Excess tax benefit | $ 7,100 | $ 7,200 | ||
Cumulative effect of adoption of ASU 2014-09 | $ 2,221 | |||
Difference between Revenue Guidance in Effect before and after Topic 606 | Adjustments due to ASU 2014-09 | ||||
Schedule Of Income Taxes [Line Items] | ||||
Deferred income tax liabilities | $ (800) | |||
Accumulated Deficit | ||||
Schedule Of Income Taxes [Line Items] | ||||
Cumulative effect of adoption of ASU 2014-09 | 2,221 | |||
Accumulated Deficit | Adjustments due to ASU 2014-09 | ||||
Schedule Of Income Taxes [Line Items] | ||||
Cumulative effect of adoption of ASU 2014-09 | $ 2,200 | |||
Accumulated Deficit | Difference between Revenue Guidance in Effect before and after Topic 606 | Adjustments due to ASU 2014-09 | ||||
Schedule Of Income Taxes [Line Items] | ||||
Cumulative effect of adoption of ASU 2014-09 | $ 800 |
Fair Value Measurements - Valua
Fair Value Measurements - Valuation Inputs (Details) - Recurring - Contingent Consideration | Jun. 30, 2018 | Dec. 31, 2017 |
Discount rates | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.165 | 0.163 |
Volatility rates | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.250 | 0.240 |
Risk free rate of return | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.022 | 0.016 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Contingent Consideration | Level 3 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | $ 52 | $ 414 | $ 1,394 | $ 541 |
Recurring | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 52 | 414 | ||
Recurring | Level 1 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 0 | 0 | ||
Recurring | Level 2 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 0 | 0 | ||
Recurring | Level 3 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 52 | 414 | ||
Recurring | Contingent Consideration | AssetEye | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 247 | |||
Recurring | Contingent Consideration | AssetEye | Level 1 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 0 | |||
Recurring | Contingent Consideration | AssetEye | Level 2 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 0 | |||
Recurring | Contingent Consideration | AssetEye | Level 3 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 247 | |||
Recurring | Contingent Consideration | Axiometrics | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 52 | 167 | ||
Recurring | Contingent Consideration | Axiometrics | Level 1 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 0 | 0 | ||
Recurring | Contingent Consideration | Axiometrics | Level 2 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 0 | 0 | ||
Recurring | Contingent Consideration | Axiometrics | Level 3 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Liabilities measured at fair value | 52 | 167 | ||
Recurring | Interest rate swap agreements | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Assets measured at fair value | 1,465 | 1,329 | ||
Recurring | Interest rate swap agreements | Level 1 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Assets measured at fair value | 0 | 0 | ||
Recurring | Interest rate swap agreements | Level 2 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Assets measured at fair value | 1,465 | 1,329 | ||
Recurring | Interest rate swap agreements | Level 3 | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Assets measured at fair value | $ 0 | $ 0 |
Fair Value Measurements - Chang
Fair Value Measurements - Changes in Level 3 Fair Values (Details) - Level 3 - Contingent Consideration - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance at beginning of period | $ 414 | $ 541 |
Initial contingent consideration | 0 | 812 |
Settlements through cash payments | (247) | 0 |
Net (gain) loss on change in fair value | (115) | 41 |
Balance at end of period | $ 52 | $ 1,394 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Revolving Facility | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Revolving line of credit outstanding borrowings | $ 50,000,000 | $ 0 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Convertible Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Fair Value | Non recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible debt fair value | $ 491,177 | $ 430,301 |
Carrying Value | Non recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible debt fair value | 286,908 | 281,199 |
Term Loans | Fair Value | Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Term Loans | 303,280 | 303,806 |
Term Loans | Carrying Value | Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Term Loans | $ 311,515 | $ 317,377 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | May 29, 2018 | May 31, 2014 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 05, 2018 | Jun. 04, 2018 |
Class of Stock [Line Items] | |||||||||||
Proceeds from public offering, net of underwriters’ discount and offering costs | $ 441,799,000 | $ 0 | |||||||||
Offering Costs | $ 17,100,000 | ||||||||||
Common stock, shares authorized (in shares) | 250,000,000 | 250,000,000 | 125,000,000 | 250,000,000 | 125,000,000 | ||||||
Authorized amount of common stock repurchase | $ 50,000,000 | ||||||||||
Number of shares repurchased (in shares) | 0 | 0 | 0 | 0 | |||||||
Common Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Repurchase period (in years) | 1 year | 1 year | 1 year | 1 year | |||||||
Public Stock Offering | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of shares issued in underwritten common stock offering (in shares) | 8,050,000 | ||||||||||
Proceeds from public offering, net of underwriters’ discount and offering costs | $ 458,900,000 | ||||||||||
Proceeds from public offering, net of underwriters’ discount and offering costs | $ 441,800,000 | ||||||||||
Over-Allotment Option | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of shares issued in underwritten common stock offering (in shares) | 1,050,000 | ||||||||||
Sale of stock price (in dollars per share) | $ 57 |
Derivative Financial Instrume69
Derivative Financial Instruments (Details) $ in Millions | 6 Months Ended | |
Jun. 30, 2018USD ($) | Mar. 31, 2016derivative_instrument | |
Reclassification out of AOCI | ||
Derivative [Line Items] | ||
Cash flow hedge gain (loss) to be reclassified within twelve months | $ 1.1 | |
Interest rate swap agreements | ||
Derivative [Line Items] | ||
Number of derivative instruments | derivative_instrument | 2 | |
Blended fixed interest rate percentage | 0.89% | |
Contract termination value | $ 1.5 |
Derivative Financial Instrume70
Derivative Financial Instruments - Gain (Loss) on Derivatives (Details) - Interest rate swaps - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Cash flow hedges | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
(Loss) gain on interest rate swaps, net | $ 108,000 | $ (21,000) | $ 367,000 | $ 73,000 | |
Interest Expense and Other | Cash flow hedges | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) recognized in income - effective portion | 145,000 | (3,000) | 244,000 | 9,000 | |
Gain recognized in income - ineffective portion | (15,000) | $ 10,000 | (31,000) | $ 28,000 | |
Other long-term liabilities | Level 2 | Derivative Financial Instruments | Recurring | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Notional amount | 75,000,000 | 75,000,000 | $ 75,000,000 | ||
Derivative liability | $ 1,465,000 | $ 1,465,000 | $ 1,329,000 |
Investments (Details)
Investments (Details) - USD ($) $ in Millions | 1 Months Ended | |||
Jan. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2017 | Aug. 31, 2016 | |
Convertible Debt Securities | WayBlazer Note 1 | ||||
Schedule of Investments [Line Items] | ||||
Original cash paid | $ 2 | |||
Interest rate stated percentage | 8.00% | |||
Convertible Debt Securities | WayBlazer Note 2 | ||||
Schedule of Investments [Line Items] | ||||
Ownership percentage, less than | 8.00% | |||
License term | 5 years | |||
Maximum | Compstak | ||||
Schedule of Investments [Line Items] | ||||
Ownership percentage, less than | 20.00% | |||
Other Assets | Series A-1 | Convertible Preferred Stock | Compstak | ||||
Schedule of Investments [Line Items] | ||||
Carrying value of investment | $ 3 | $ 3 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event - USD ($) $ in Millions | Aug. 01, 2018 | Jul. 13, 2018 |
BluTrend | ||
Subsequent Event [Line Items] | ||
Cash paid | $ 8.5 | |
Total deferred cash obligation | 1 | |
Deferred stock obligation | $ 1 | |
LeaseLabs, Inc. | ||
Subsequent Event [Line Items] | ||
Cash paid | $ 103 | |
Total deferred cash obligation | 14 | |
Deferred stock obligation | 5 | |
Deferred cash payment amount related to acquisition | $ 11.8 |