Document_and_Entity_Informatio
Document and Entity Information Document | 6 Months Ended | |
Jun. 30, 2014 | Jul. 25, 2014 | |
Entity [Abstract] | ' | ' |
Entity Registrant Name | 'RUCKUS WIRELESS INC | ' |
Entity Central Index Key | '0001294016 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Jun-14 | ' |
Amendment Flag | 'false | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 82,735,732 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $93,017 | $91,282 |
Short-term investments | 77,224 | 60,878 |
Accounts receivable, net of allowance for doubtful accounts of $800 and $400 as of June 30, 2014 and December 31, 2013, respectively | 58,702 | 44,638 |
Inventories | 16,609 | 16,748 |
Deferred costs | 4,312 | 4,207 |
Deferred tax assets | 7,736 | 7,715 |
Prepaid expenses and other current assets | 5,674 | 5,227 |
Total current assets | 263,274 | 230,695 |
Property and equipment, net | 12,365 | 11,472 |
Goodwill | 9,945 | 9,945 |
Intangible assets, net | 8,761 | 9,671 |
Non-current deferred tax asset | 14,717 | 15,317 |
Restricted cash | 5,000 | 5,000 |
Other assets | 1,363 | 1,122 |
Total assets | 315,425 | 283,222 |
Current liabilities: | ' | ' |
Accounts payable | 18,785 | 19,131 |
Accrued compensation | 14,051 | 11,759 |
Accrued liabilities | 7,318 | 6,231 |
Deferred revenue | 38,483 | 33,139 |
Total current liabilities | 78,637 | 70,260 |
Non-current deferred revenue | 9,023 | 7,098 |
Non-current deferred tax liabilities | 854 | 854 |
Other non-current liabilities | 1,249 | 1,161 |
Total liabilities | 89,763 | 79,373 |
Commitments and contingencies (Note 7) | ' | ' |
Stockholders’ equity: | ' | ' |
Common stock, $0.001 par value; 250,000 shares authorized as of June 30, 2014 and December 31, 2013; 82,662 and 80,691 shares issued and outstanding at June 30, 2014 and December 31, 2013, respectively | 83 | 81 |
Additional paid–in capital | 245,687 | 225,575 |
Accumulated other comprehensive loss | -15 | -2 |
Accumulated deficit | -20,093 | -21,805 |
Total stockholders’ equity | 225,662 | 203,849 |
Total liabilities and stockholders’ equity | $315,425 | $283,222 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Allowance for doubtful accounts | $800 | $400 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common Stock, Shares, Issued | 82,662,000 | 80,691,000 |
Common stock, shares outstanding | 82,662,000 | 80,691,000 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Revenue: | ' | ' | ' | ' |
Product | $75,352 | $59,663 | $145,427 | $112,974 |
Service | 5,648 | 4,210 | 10,625 | 8,140 |
Total revenue | 81,000 | 63,873 | 156,052 | 121,114 |
Cost of revenue: | ' | ' | ' | ' |
Product | 22,209 | 18,923 | 43,705 | 35,494 |
Service | 2,932 | 2,447 | 5,691 | 4,734 |
Total cost of revenue | 25,141 | 21,370 | 49,396 | 40,228 |
Gross profit | 55,859 | 42,503 | 106,656 | 80,886 |
Operating expenses: | ' | ' | ' | ' |
Research and development | 18,954 | 14,934 | 37,093 | 28,712 |
Sales and marketing | 24,412 | 19,564 | 47,682 | 36,415 |
General and administrative | 8,358 | 6,950 | 16,795 | 14,882 |
Total operating expenses | 51,724 | 41,448 | 101,570 | 80,009 |
Operating income (loss) | 4,135 | 1,055 | 5,086 | 877 |
Interest income | 46 | 48 | 92 | 82 |
Other expense, net | -84 | -150 | -110 | -227 |
Income before income taxes | 4,097 | 953 | 5,068 | 732 |
Income tax expense (benefit) | 2,658 | 251 | 3,356 | -284 |
Net income | $1,439 | $702 | $1,712 | $1,016 |
Net income per share attributable to common stockholders: | ' | ' | ' | ' |
Basic (USD per share) | $0.02 | $0.01 | $0.02 | $0.01 |
Diluted (USD per share) | $0.02 | $0.01 | $0.02 | $0.01 |
Weighted average number of shares outstanding, basic (in shares) | 82,315 | 75,352 | 81,799 | 74,779 |
Weighted average number of shares outstanding, diluted (in shares) | 92,358 | 92,595 | 92,967 | 93,649 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Statement of Comprehensive Income [Abstract] | ' | ' | ' | ' |
Net income | $1,439 | $702 | $1,712 | $1,016 |
Other comprehensive loss, net of tax: | ' | ' | ' | ' |
Unrealized loss on short-term investments | -7 | -38 | -13 | -38 |
Comprehensive income | $1,432 | $664 | $1,699 | $978 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 |
Cash flows from operating activities | ' | ' |
Net income | $1,712 | $1,016 |
Adjustments to reconcile net income to cash provided by operating activities: | ' | ' |
Depreciation and amortization | 4,261 | 2,983 |
Provision for doubtful accounts | 400 | 634 |
Stock-based compensation | 12,686 | 8,343 |
Amortization of investment premiums, net of accretion of purchase discounts | 580 | 256 |
Deferred income taxes | 2,812 | -444 |
Excess income tax benefit from the exercise of stock options | -2,226 | 0 |
Changes in operating assets and liabilities | ' | ' |
Accounts receivable | -14,464 | -11,987 |
Inventories | 139 | -781 |
Deferred costs | -105 | 677 |
Prepaid expenses and other current assets | -379 | -1,246 |
Other assets | -226 | 29 |
Accounts payable | -67 | -962 |
Accrued compensation | 2,292 | 1,492 |
Accrued liabilities | 1,175 | 528 |
Deferred revenue | 7,269 | -1,983 |
Net cash provided by (used in) operating activities | 15,859 | -1,445 |
Cash flows from investing activities | ' | ' |
Purchase of investments | -66,335 | -54,249 |
Proceeds from the maturity of investments | 49,321 | 0 |
Purchase of property and equipment | -4,523 | -3,897 |
Increase (Decrease) in Lease Deposits | 15 | 31 |
Cash used in acquisition | 0 | -1,000 |
Increase (Decrease) in Restricted Cash | 0 | -5,000 |
Net cash used in investing activities | -21,552 | -64,177 |
Cash flows from financing activities: | ' | ' |
Proceeds from exercise of stock options | 3,169 | 2,655 |
Proceeds from Issuance of Shares under Incentive and Share-based Compensation Plans, Including Stock Options | 2,033 | 1,486 |
Excess Tax Benefit from Share-based Compensation, Financing Activities | 2,226 | 0 |
Payments of Stock Issuance Costs | 0 | 839 |
Net cash provided by financing activities | 7,428 | 3,302 |
Net increase (decrease) in cash and cash equivalents | 1,735 | -62,320 |
Cash and cash equivalents at beginning of period | 91,282 | 133,386 |
Cash and cash equivalents at end of period | 93,017 | 71,066 |
Supplemental disclosure of cash flow information | ' | ' |
Cash paid for income taxes | 426 | 539 |
Non-cash investing and financing activities | ' | ' |
Purchases of property and equipment recorded in accounts payable and accrued liabilities | $832 | $690 |
DESCRIPTION_OF_BUSINESS_AND_SU
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended | |||||||||||
Jun. 30, 2014 | ||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||||||
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | |||||||||||
Description of Business— Ruckus Wireless, Inc. (“Ruckus”) is a leading provider of carrier-class Wi-Fi solutions. Ruckus’s solutions, which it calls Smart Wi-Fi, are used by service providers and enterprises to solve network capacity and coverage challenges associated with the rapidly increasing traffic and number of users and client devices on wireless networks. Ruckus’s Smart Wi-Fi solutions offer carrier-class features and functionality such as enhanced reliability, consistent performance, extended range and massive scalability. Ruckus’s products include gateways, wireless local area network (“WLAN”) controllers and high performance access points. These products incorporate the Company’s patented and proprietary technologies, such as Smart Radio, Smart QoS, Smart Mesh and Smart Scale, to enable high performance, reliable, adaptive and high capacity connectivity in a wide range of challenging operating conditions faced by service providers and enterprises. | ||||||||||||
Basis of Presentation— The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in Ruckus’s Annual Report on Form 10-K for the year ended December 31, 2013, filed on March 3, 2014. | ||||||||||||
The condensed consolidated balance sheet as of December 31, 2013, included herein, was derived from the audited financial statements as of that date, but does not include all disclosures including notes required by GAAP. | ||||||||||||
In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the full year 2014 or any future period. | ||||||||||||
Principles of Consolidation— The condensed financial statements include the accounts of Ruckus and its wholly owned subsidiaries (collectively, the “Company”). All intercompany balances and transactions have been eliminated in consolidation. | ||||||||||||
Use of Estimates— The preparation of financial statements in conformity with GAAP in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Significant estimates and assumptions made by management include the determination of revenue recognition, allowance for doubtful accounts, goodwill and intangible valuation, the fair value of stock awards, inventory valuation, estimates of warranty liability and accounting for income taxes. Management bases its estimates on historical experience and also on assumptions that it believes are reasonable. Actual results could materially differ from those estimates. | ||||||||||||
Summary of Significant Accounting Policies— There have been no material changes to our significant accounting policies as compared to those described in our Annual Report on Form 10-K for the year ended December 31, 2013. | ||||||||||||
Recent Accounting Pronouncements— In May 2014, the Financial Accounting Standard Board (“FASB”) and International Accounting Standards Board (“IASB”) issued ASU 2014-09, Revenue from Contracts with Customers, a converged standard on revenue recognition. Some of the main areas of transition to the new standard include, among others, transfer of control (revenue is recognized when a customer obtains control of a good or service), allocation of transaction price based on relative standalone selling price (entities that sell multiple goods or services in a single arrangement must allocate the consideration to each of those goods or services), contract costs (entities sometimes incur costs, such as sales commissions or mobilization activities, to obtain or fulfill a contract), and disclosures (extensive disclosures are required to provide greater insight into both revenue that has been recognized, and revenue that is expected to be recognized in the future from existing contracts). This accounting standard will be effective for the Company beginning in the first quarter of 2017, with no early adoption permitted. This standard may be adopted using either a full retrospective application or a modified retrospective application, where the cumulative effect of initially adopting the standard is recognized as an adjustment to the opening balance of retained earnings. The Company is currently evaluating the impact of this accounting standard on its consolidated financial position, results of operations and cash flows. | ||||||||||||
Concentrations of Credit Risk and Significant Customers— Financial instruments that subject the Company to significant concentrations of credit risk primarily consist of cash, cash equivalents, short-term investments and accounts receivable. The Company invests only in high credit quality instruments and maintains its cash, cash equivalents and available-for-sale investments in fixed income securities. Management believes that the financial institutions that hold the Company’s investments are financially sound and, accordingly, are subject to minimal credit risk. Deposits held with banks may exceed the amount of insurance provided on such deposits. The Company’s accounts receivable are primarily derived from distributors and service providers located in the Americas, Europe, and Asia Pacific. The Company generally does not require its customers to provide collateral to support accounts receivable. To reduce credit risk, management performs ongoing credit evaluations of its customers’ financial condition. The Company has recorded an allowance for doubtful accounts for those receivables management has determined to not be collectible. | ||||||||||||
The percentages of revenues from individual customers totaling greater than 10% of total consolidated Company revenues were as follows: | ||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||
Distributor A | 15.8 | % | 17.1 | % | 15.3 | % | 15.4 | % | ||||
Distributor B | 14 | % | 12.8 | % | 13.5 | % | 12 | % | ||||
Distributor C | 11.8 | % | * | 11.8 | % | * | ||||||
* Less than 10% | ||||||||||||
The percentage of receivables from individual customers totaling greater than 10% of total consolidated Company accounts receivable were as follows: | ||||||||||||
June 30, | December 31, | |||||||||||
2014 | 2013 | |||||||||||
Distributor C | 20.5 | % | 10.4 | % | ||||||||
Distributor A | * | 11.6 | % | |||||||||
Distributor D | * | 11.2 | % | |||||||||
* Less than 10% |
FAIR_VALUE_DISCLOSURE
FAIR VALUE DISCLOSURE | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
FAIR VALUE DISCLOSURE | ' | |||||||||||||||
FAIR VALUE DISCLOSURE | ||||||||||||||||
Assets and liabilities recorded at fair value in the condensed consolidated financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. The Company categorizes its financial instruments into a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). | ||||||||||||||||
A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. There were no transfers between levels during the six months ended June 30, 2014. Hierarchical levels that are directly related to the amount of subjectivity associated with the inputs to the valuation of these assets or liabilities are as follows: | ||||||||||||||||
Level 1 | Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. | |||||||||||||||
Level 2 | Observable prices that are based on inputs not quoted on active markets, but corroborated by market data. | |||||||||||||||
Level 3 | Unobservable inputs are used when little or no market data is available. | |||||||||||||||
The Company’s assets that were measured at fair value by level within the fair value hierarchy were as follows (in thousands): | ||||||||||||||||
30-Jun-14 | ||||||||||||||||
Fair Value | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets | ||||||||||||||||
Money market funds | $ | 31,524 | $ | 31,524 | $ | — | $ | — | ||||||||
Corporate debt securities | 77,224 | — | 77,224 | — | ||||||||||||
Total assets measured and recorded at fair value | $ | 108,748 | $ | 31,524 | $ | 77,224 | $ | — | ||||||||
31-Dec-13 | ||||||||||||||||
Fair Value | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets: | ||||||||||||||||
Money market funds | $ | 47,773 | $ | 47,773 | $ | — | $ | — | ||||||||
Corporate debt securities | 60,878 | — | 60,878 | — | ||||||||||||
Total assets measured and recorded at fair value | $ | 108,651 | $ | 47,773 | $ | 60,878 | $ | — | ||||||||
INVESTMENTS
INVESTMENTS | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ' | |||||||||||||||
INVESTMENTS | ' | |||||||||||||||
INVESTMENTS | ||||||||||||||||
Investments consisted of the following (in thousands): | ||||||||||||||||
June 30, 2014 | ||||||||||||||||
Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | |||||||||||||
Corporate debt securities | $ | 77,247 | $ | 2 | $ | (25 | ) | $ | 77,224 | |||||||
31-Dec-13 | ||||||||||||||||
Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | |||||||||||||
Corporate debt securities | $ | 60,882 | $ | 9 | $ | (13 | ) | $ | 60,878 | |||||||
All of the Company's investments have a contractual maturity of less than 12 months from June 30, 2014. The gross realized gains and gross realized losses related to the Company’s available-for-sale investments were not material for the three and six months ended June 30, 2014. | ||||||||||||||||
Investments in an unrealized loss position at June 30, 2014 consisted of the following (in thousands): | ||||||||||||||||
Less Than 12 Months | ||||||||||||||||
Fair Value | Unrealized Loss | |||||||||||||||
Corporate debt securities | $ | 34,304 | $ | (25 | ) | |||||||||||
The Company does not intend to sell any of these investments, and it is not more likely than not, that the Company would be required to sell these investments before recovery of their amortized cost basis, which may be at maturity. |
BUSINESS_COMBINATIONS
BUSINESS COMBINATIONS | 6 Months Ended | |||
Jun. 30, 2014 | ||||
Business Combinations [Abstract] | ' | |||
BUSINESS COMBINATIONS | ' | |||
BUSINESS COMBINATIONS | ||||
On July 18, 2013, the Company acquired all of the outstanding equity interests of YFind Technologies Private Limited (“YFind”), a privately-held software company providing indoor positioning and real-time location-based analytics. The Company acquired YFind to obtain its technology and expertise in location-based services. The purchase consideration was $6.1 million, all of which was paid in cash. | ||||
Former YFind employees who became the employees of the Company were granted 219,782 restricted stock units (“RSUs”) and 51,900 stock options under the Company's Amended & Restated 2012 Equity Incentive Plan (the “2012 Plan”). The equity awards vest between three and four years from when the employee was hired. The fair value of the equity awards of $3.6 million will be recognized as post-acquisition compensation expense over the requisite service period. The Company is also obligated to pay retention bonuses of up to $0.4 million to certain former YFind employees who became employees of the Company, over two years from the date of hire. Both the equity awards and the retention bonuses are subject to certain continued employment restrictions. For the three and six months ended June 30, 2014, the Company recorded compensation costs of $0.4 million and $0.7 million, respectively, in research and development expenses associated with the equity awards and the retention bonuses. | ||||
The purchase allocation for YFind is summarized as follows (in thousands): | ||||
Fair Value | ||||
Cash and cash equivalents | $ | 257 | ||
Other tangible assets | 8 | |||
In-process research and development | 6,000 | |||
Goodwill | 914 | |||
Non-current deferred tax liabilities | (1,020 | ) | ||
Other liabilities assumed | (21 | ) | ||
Total purchase consideration | $ | 6,138 | ||
Pro forma results of operations for the YFind acquisition have not been presented because they are not material to the condensed consolidated statements of operations. |
GOODWILL_AND_INTANGIBLES_ASSET
GOODWILL AND INTANGIBLES ASSETS | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||
GOODWILL AND INTANGIBLE ASSETS | ' | |||||||||||||
GOODWILL AND INTANGIBLE ASSETS | ||||||||||||||
Intangible assets consisted of the following (in thousands, except years): | ||||||||||||||
Gross Carrying | Accumulated | Net | Weighted | |||||||||||
Amount | Amortization | Carrying | Average | |||||||||||
Amount | Remaining | |||||||||||||
Life | ||||||||||||||
June 30, 2014: | ||||||||||||||
Purchased technology | $ | 12,600 | $ | (3,839 | ) | $ | 8,761 | 3.0 years | ||||||
December 31, 2013: | ||||||||||||||
Purchased technology | $ | 6,600 | $ | (2,929 | ) | $ | 3,671 | 2.8 years | ||||||
In-process research and development | 6,000 | — | 6,000 | |||||||||||
Total | $ | 12,600 | $ | (2,929 | ) | $ | 9,671 | |||||||
On July 18, 2013, the Company recorded the fair value of the in-process research and development of $6.0 million related to the acquisition of YFind. The in-process research and development, which was completed on May 1, 2014, was transferred to purchased technology and will be amortized over its estimated useful life of four years. | ||||||||||||||
The following table presents the estimated future amortization expense of intangible assets as of June 30, 2014 (in thousands): | ||||||||||||||
Year ending December 31, | Amount | |||||||||||||
2014 (remaining six months) | $ | 1,410 | ||||||||||||
2015 | 2,820 | |||||||||||||
2016 | 2,531 | |||||||||||||
2017 | 1,500 | |||||||||||||
2018 | 500 | |||||||||||||
Total amortization | $ | 8,761 | ||||||||||||
The Company had goodwill of $9.9 million as of June 30, 2014 and December 31, 2013. No impairment has been recognized related to the goodwill balance. |
DEFERRED_REVENUE
DEFERRED REVENUE | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Deferred Revenue Disclosure [Abstract] | ' | |||||||
DEFERRED REVENUE | ' | |||||||
DEFERRED REVENUE | ||||||||
Deferred revenue consisted of the following (in thousands): | ||||||||
June 30, | December 31, | |||||||
2014 | 2013 | |||||||
Product | $ | 22,927 | $ | 21,732 | ||||
Service | 24,579 | 18,505 | ||||||
Total deferred revenue | $ | 47,506 | $ | 40,237 | ||||
Reported as: | ||||||||
Current | $ | 38,483 | $ | 33,139 | ||||
Non-current | 9,023 | 7,098 | ||||||
Total deferred revenue | $ | 47,506 | $ | 40,237 | ||||
Deferred product revenue relates to arrangements where not all revenue recognition criteria have been met. Deferred service revenue represents support contracts billed in advance and revenue is recognized ratably over the support period, typically one to five years. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||
COMMITMENTS AND CONTINGENCIES | ' | |||||||||||||||
COMMITMENTS AND CONTINGENCIES | ||||||||||||||||
Operating Leases—The Company’s primary facilities are located in Sunnyvale, California, Shenzhen, China, Beijing, China, Taipei, Taiwan, Bangalore, India and Woodburn Green, United Kingdom and are leased under non-cancelable operating lease arrangements. | ||||||||||||||||
Future minimum lease payments under non-cancelable operating leases were as follows (in thousands): | ||||||||||||||||
Years ending December 31, | Amount | |||||||||||||||
2014 (remaining six months) | $ | 1,841 | ||||||||||||||
2015 | 3,687 | |||||||||||||||
2016 | 2,988 | |||||||||||||||
2017 | 2,646 | |||||||||||||||
2018 | 2,590 | |||||||||||||||
Thereafter | 10,033 | |||||||||||||||
Operating lease obligations | $ | 23,785 | ||||||||||||||
Litigation— The Company is involved in legal proceedings, claims, and litigation arising in the ordinary course of business. Management is not currently aware of any matters that it expects will have a material adverse effect on the consolidated financial position, results of operations, or cash flows of the Company. | ||||||||||||||||
For the six months ended June 30, 2014, the Company settled several patent litigation claims for a net gain of $0.8 million, which is included in general and administrative expense in the condensed consolidated statements of operations. The Company did not have material settlement gains or losses for the three months ended June 30, 2014, and three and six months ended June 30, 2013. | ||||||||||||||||
Purchase Commitments— As of June 30, 2014, the Company had current purchase commitments of $18.1 million for inventory and specific contractual services. | ||||||||||||||||
Indemnification Agreements— The Company indemnifies its directors for certain events or occurrences, subject to certain limits, while the director is or was serving at the Company’s request in such capacity. The term of the indemnification period is for the director’s term of service. The Company may terminate the indemnification agreements with its directors upon the termination of their services as directors of the Company, but termination will not affect claims for indemnification related to events occurring prior to the effective date of termination. The maximum amount of potential future indemnification is unlimited; however, the Company has a director insurance liability policy that limits its exposure. The Company believes the fair value of these indemnification agreements is minimal. The Company has also entered into customary indemnification agreements with each of its officers. | ||||||||||||||||
The Company indemnifies its channel partners against certain claims alleging that the Company’s products (excluding custom products and/or custom support) infringe a patent, copyright, trade secret, or trademark, provided that a channel partner promptly notifies the Company in writing of the claim and such channel partner cooperates with the Company and grants the Company the authority to control the defense and any related settlement. | ||||||||||||||||
The Company has not recorded any liabilities for these agreements as of June 30, 2014 and December 31, 2013. | ||||||||||||||||
Reimbursement of Penalties— As of June 30, 2014, the Company held $5.0 million in escrow to secure an indemnification agreement. If triggered, the Company will indemnify a channel partner for reimbursement of penalties assessed under the Information Technology Act of India (“IT Act”). The IT Act specifies penalties for network service providers in the event of illegal or unauthorized use of computers, computer systems and data stored therein. In the event that Ruckus equipment is the cause of a network service provider breach, the Company is required to indemnify the channel partner, without limitation to the amount, for penalties reimbursed by the channel partner to the network service provider under the IT Act. The indemnification period is six years beginning from April 2013. To date no claims have been made under the IT Act, for which the Company would be potentially liable. | ||||||||||||||||
Warranties— The Company offers a limited lifetime hardware warranty on its indoor WLAN products and a limited warranty for all other hardware products for a period of up to one year. The Company estimates the costs that may be incurred under its warranties and records a liability for products sold as a charge to cost of revenue. Estimates of future warranty costs are largely based on historical experience of product failure rates and material usage incurred in correcting product failures. The Company periodically assesses the adequacy of its recorded warranty liability and adjusts the amounts as necessary. | ||||||||||||||||
The warranty liability is included as a component of accrued liabilities in the accompanying condensed consolidated balance sheets. Changes in the warranty liability were as follows (in thousands): | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Balance at beginning of period | $ | 896 | $ | 774 | $ | 1,038 | $ | 725 | ||||||||
Changes in existing warranty | (207 | ) | (45 | ) | (114 | ) | (25 | ) | ||||||||
Warranty expense | 298 | 113 | 554 | 292 | ||||||||||||
Obligations fulfilled | (140 | ) | (91 | ) | (631 | ) | (241 | ) | ||||||||
Balance at end of period | $ | 847 | $ | 751 | $ | 847 | $ | 751 | ||||||||
EQUITY_AWARD_PLAN
EQUITY AWARD PLAN | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||||
EQUITY AWARD PLAN | ' | |||||||||||||||
EQUITY AWARD PLAN | ||||||||||||||||
Stock Option and Restricted Stock Unit Activity | ||||||||||||||||
The following table summarizes the outstanding stock option activity and a summary of information related to stock options (in thousands, except per share amounts and years): | ||||||||||||||||
Common Stock Options Outstanding | ||||||||||||||||
Number of | Weighted | Weighted | Aggregate | |||||||||||||
Shares | Average | Average | Intrinsic | |||||||||||||
Exercise Price Per Share | Remaining | Value | ||||||||||||||
Contractual Life (Years) | ||||||||||||||||
Balance, December 31, 2013 | 19,609 | $ | 4.51 | 7.3 | $ | 195,142 | ||||||||||
Options granted | 338 | 11.53 | ||||||||||||||
Options exercised | -1,531 | 2.07 | ||||||||||||||
Options forfeited | -337 | 9.8 | ||||||||||||||
Balance, June 30, 2014 | 18,079 | $ | 4.75 | 6.9 | $ | 139,004 | ||||||||||
Options exercisable as of June 30, 2014 | 11,385 | $ | 3.13 | 6.2 | $ | 102,842 | ||||||||||
Options vested and expected to vest as of June 30, 2014 | 17,833 | $ | 4.67 | 6.9 | $ | 138,073 | ||||||||||
The weighted average grant date fair value of stock options was approximately $6.26 and $10.98 per share for the three months ended June 30, 2014 and 2013, respectively, and $6.84 and $12.91 for the six months ended June 30, 2014 and 2013, respectively. | ||||||||||||||||
The total intrinsic value of options exercised was approximately $3.4 million and $25.0 million for the three months ended June 30, 2014 and 2013, respectively, and $16.7 million and $25.6 million for the six months ended June 30, 2014 and 2013. | ||||||||||||||||
The following table summarizes the outstanding activity of RSUs and a summary of information related to RSUs (in thousands, except per share amounts and years): | ||||||||||||||||
Restricted Stock Units Outstanding | ||||||||||||||||
Number of Shares | Weighted | Weighted | Aggregate | |||||||||||||
Average | Average | Intrinsic | ||||||||||||||
Grant Date Fair Value | Remaining | Value | ||||||||||||||
Per Share | Contractual Life (Years) | |||||||||||||||
Balance, December 31, 2013 | 1,011 | $ | 17.11 | 1.6 | $ | 14,356 | ||||||||||
RSUs granted | 648 | 11.16 | ||||||||||||||
RSUs vested | (178 | ) | 19.67 | |||||||||||||
RSUs forfeited | (50 | ) | 16.27 | |||||||||||||
Balance, June 30, 2014 | 1,431 | $ | 14.12 | 1.5 | $ | 17,039 | ||||||||||
The following table summarizes the stock activity and the total number of shares available for grant under the 2012 Plan as of June 30, 2014 (in thousands): | ||||||||||||||||
Number of | ||||||||||||||||
Shares | ||||||||||||||||
Balance, December 31, 2013 | 8,547 | |||||||||||||||
Additional shares reserved for issuance | 4,035 | |||||||||||||||
RSUs granted | (648 | ) | ||||||||||||||
RSUs forfeited | 50 | |||||||||||||||
Options granted | (338 | ) | ||||||||||||||
Options forfeited | 337 | |||||||||||||||
Balance, June 30, 2014 | 11,983 | |||||||||||||||
Fair Value Disclosures | ||||||||||||||||
The Company measures compensation expense for all stock-based payment awards, including stock options and RSUs granted to employees and purchases under the Company's Employee Stock Purchase Plan (“ESPP”), based on the estimated fair values on the date of the grant. The fair value of each stock option granted is estimated using the Black-Scholes option pricing model. The fair value of each RSU granted represents the closing price of the Company's common stock on the date of grant. The fair value of purchases under the Company's ESPP is calculated based on the closing price of the Company's stock on the date of grant and the value of put and call options estimated using the Black-Scholes option pricing model. Stock-based compensation is recognized on a straight-line basis over the requisite service period, net of estimated forfeitures. The forfeiture rate is based on an analysis of the Company’s actual historical forfeitures. | ||||||||||||||||
The Company accounts for stock options issued to non-employees based on the fair value of the awards determined using the Black-Scholes option pricing model. The fair value of stock options granted to non-employees is re-measured as the stock options vest, and the resulting change in fair value, if any, is recognized in the Company’s condensed consolidated statement of operations during the period the related services are rendered. | ||||||||||||||||
Employee Stock Options | ||||||||||||||||
The following table summarizes the weighted average assumptions relating to the Company's stock options: | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Volatility | 63.5 | % | 69.2 | % | 63.8 | % | 70.3 | % | ||||||||
Expected term (years) | 6.1 | 6.1 | 6.1 | 6 | ||||||||||||
Risk-free interest rate | 1.9 | % | 1.7 | % | 1.9 | % | 1.1 | % | ||||||||
Dividend yield | — | — | — | — | ||||||||||||
Employee Stock Purchase Plan | ||||||||||||||||
The following table summarizes the assumptions relating to the Company's ESPP: | ||||||||||||||||
Six Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | |||||||||||||||
Volatility | 45.8 | % | 57.6 | % | ||||||||||||
Expected term (years) | 0.5 | 0.5 | ||||||||||||||
Risk-free interest rate | 0.1 | % | 0.1 | % | ||||||||||||
Dividend yield | — | — | ||||||||||||||
Stock-based Compensation Expense | ||||||||||||||||
The following table summarizes the stock-based compensation expense recorded for stock awards issued to employees and non-employees (in thousands): | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Cost of revenue | $ | 253 | $ | 206 | $ | 498 | $ | 382 | ||||||||
Research and development | 2,126 | 1,479 | 4,222 | 2,778 | ||||||||||||
Sales and marketing | 1,710 | 1,182 | 3,325 | 2,187 | ||||||||||||
General and administrative | 2,251 | 1,446 | 4,641 | 2,996 | ||||||||||||
Total stock-based compensation | $ | 6,340 | $ | 4,313 | $ | 12,686 | $ | 8,343 | ||||||||
At June 30, 2014, the total unrecognized stock-based compensation expense related to employees and non-employees under the Company's stock plans was $46.2 million, net of estimated forfeitures. The unamortized expense will be recognized over a weighted-average period of 2.0 years. |
EARNINGS_PER_SHARE
EARNINGS PER SHARE | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
EARNINGS PER SHARE | ' | |||||||||||||||
EARNINGS 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 dividing net income by the weighted-average number of common shares outstanding, including potential dilutive common shares assuming the dilutive effect of outstanding stock awards using the treasury stock method. Under the treasury stock method, the amount the employee must pay for exercising stock awards, the amount of compensation cost for future service that the Company has not yet recognized, and the amount of tax benefits that would be recorded in additional paid-in capital when the award becomes deductible, are collectively assumed to be used to repurchase shares. | ||||||||||||||||
The following table presents the calculation of basic and diluted net income per share (in thousands, except per share data): | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Numerator: | ||||||||||||||||
Net income | $ | 1,439 | $ | 702 | $ | 1,712 | $ | 1,016 | ||||||||
Denominator: | ||||||||||||||||
Weighted-average shares used in computing basic net income per share | 82,315 | 75,352 | 81,799 | 74,779 | ||||||||||||
Weighted-average effect of potentially dilutive shares: | ||||||||||||||||
Employee stock options | 9,994 | 17,155 | 11,032 | 18,662 | ||||||||||||
RSUs and ESPP | 49 | 88 | 136 | 208 | ||||||||||||
Diluted | 92,358 | 92,595 | 92,967 | 93,649 | ||||||||||||
Net income per share: | ||||||||||||||||
Basic | $ | 0.02 | $ | 0.01 | $ | 0.02 | $ | 0.01 | ||||||||
Diluted | $ | 0.02 | $ | 0.01 | $ | 0.02 | $ | 0.01 | ||||||||
The following table summarizes the weighted average outstanding stock awards that were excluded from the diluted per share calculation because to include them would have been anti-dilutive for the period (in thousands): | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Stock options | 2,419 | 807 | 2,333 | 736 | ||||||||||||
RSUs and ESPP | 946 | 317 | 772 | 206 | ||||||||||||
Total | 3,365 | 1,124 | 3,105 | 942 | ||||||||||||
INCOME_TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2014 | |
Income Tax Disclosure [Abstract] | ' |
INCOME TAXES | ' |
INCOME TAXES | |
The income tax expense of $2.7 million for the three months ended June 30, 2014 was primarily due to certain non-deductible stock-based compensation expenses, which caused the effective tax rate to exceed the statutory rate for the period. The income tax expense of $0.3 million for the three months ended June 30, 2013, consists of federal, foreign, and state income taxes. The effective tax rate for the three months ended June 30, 2013 is lower than the federal statutory rate primarily due primarily to certain stock compensation deductions. | |
The income tax expense of $3.4 million for the six months ended June 30, 2014 was primarily due to certain non-deductible stock-based compensation expenses, which caused the effective tax rate to exceed the statutory rate for the period. The income tax benefit of $0.3 million for the six months ended June 30, 2013 primarily relates to the extension of the R&D credit by Congress in January 2013. | |
The Company evaluates the realization of its deferred tax assets based on the expiration period of the asset, projections of future taxable income in the relevant tax jurisdiction, the effect of tax planning strategies, and other factors. Both positive and negative evidence is weighed using significant judgment. Based on an evaluation of these factors, the Company believes that the realization of its deferred tax assets is more likely than not and, therefore, a valuation allowance against its deferred tax assets is not required. In future periods, positive and negative evidence can change due to revised projections of future taxable income in the relevant jurisdictions and other factors listed above. If future circumstances require a valuation allowance to be recorded, there would be an increase in tax expense in the consolidated statements of operations without any change in net cash provided by operating activities in the consolidated statements of cash flows. |
SEGEMENT_INFORMATION
SEGEMENT INFORMATION | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
SEGMENT INFORMATION | ' | |||||||||||||||
SEGMENT INFORMATION | ||||||||||||||||
The Company operates in one industry segment selling gateways, controllers and access points along with related software and services. | ||||||||||||||||
Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision maker is its chief executive officer. The Company’s chief executive officer reviews financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance. The Company has one business activity, and there are no segment managers who are held accountable for operations, operating results and plans for products or components below the consolidated unit level. Accordingly, the Company reports as a single operating segment. The Company and its chief executive officer evaluate performance based primarily on revenue in the geographic locations in which the Company operates. Revenue is attributed by geographic location based on the bill-to location of the Company’s customers. | ||||||||||||||||
The following presents total revenue by geographic region (in thousands): | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Americas: | ||||||||||||||||
United States | $ | 39,667 | $ | 30,403 | $ | 78,142 | $ | 53,979 | ||||||||
Other Americas | 2,274 | 3,519 | 4,286 | 5,398 | ||||||||||||
Total Americas | 41,941 | 33,922 | 82,428 | 59,377 | ||||||||||||
EMEA: | ||||||||||||||||
United Kingdom | 6,691 | 6,795 | 12,605 | 13,784 | ||||||||||||
Other EMEA | 14,728 | 9,807 | 28,866 | 18,433 | ||||||||||||
Total EMEA | 21,419 | 16,602 | 41,471 | 32,217 | ||||||||||||
APAC: | ||||||||||||||||
Total APAC | 17,640 | 13,349 | 32,153 | 29,520 | ||||||||||||
Total revenue | 81,000 | 63,873 | 156,052 | 121,114 | ||||||||||||
As of June 30, 2014, the Company had property and equipment, net, of $7.7 million, $4.1 million and $0.6 million located in the Americas, APAC, and EMEA, respectively. |
DESCRIPTION_OF_BUSINESS_AND_SU1
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended | |||||||||||
Jun. 30, 2014 | ||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||||||
Description of Business | ' | |||||||||||
Description of Business— Ruckus Wireless, Inc. (“Ruckus”) is a leading provider of carrier-class Wi-Fi solutions. Ruckus’s solutions, which it calls Smart Wi-Fi, are used by service providers and enterprises to solve network capacity and coverage challenges associated with the rapidly increasing traffic and number of users and client devices on wireless networks. Ruckus’s Smart Wi-Fi solutions offer carrier-class features and functionality such as enhanced reliability, consistent performance, extended range and massive scalability. Ruckus’s products include gateways, wireless local area network (“WLAN”) controllers and high performance access points. These products incorporate the Company’s patented and proprietary technologies, such as Smart Radio, Smart QoS, Smart Mesh and Smart Scale, to enable high performance, reliable, adaptive and high capacity connectivity in a wide range of challenging operating conditions faced by service providers and enterprises. | ||||||||||||
Basis of Presentation | ' | |||||||||||
Basis of Presentation— The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in Ruckus’s Annual Report on Form 10-K for the year ended December 31, 2013, filed on March 3, 2014. | ||||||||||||
The condensed consolidated balance sheet as of December 31, 2013, included herein, was derived from the audited financial statements as of that date, but does not include all disclosures including notes required by GAAP. | ||||||||||||
In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the full year 2014 or any future period. | ||||||||||||
Principles of Consolidation | ' | |||||||||||
Principles of Consolidation— The condensed financial statements include the accounts of Ruckus and its wholly owned subsidiaries (collectively, the “Company”). All intercompany balances and transactions have been eliminated in consolidation. | ||||||||||||
Use of Estimates | ' | |||||||||||
Use of Estimates— The preparation of financial statements in conformity with GAAP in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Significant estimates and assumptions made by management include the determination of revenue recognition, allowance for doubtful accounts, goodwill and intangible valuation, the fair value of stock awards, inventory valuation, estimates of warranty liability and accounting for income taxes. Management bases its estimates on historical experience and also on assumptions that it believes are reasonable. Actual results could materially differ from those estimates. | ||||||||||||
Recent Accounting Pronouncements | ' | |||||||||||
Recent Accounting Pronouncements— In May 2014, the Financial Accounting Standard Board (“FASB”) and International Accounting Standards Board (“IASB”) issued ASU 2014-09, Revenue from Contracts with Customers, a converged standard on revenue recognition. Some of the main areas of transition to the new standard include, among others, transfer of control (revenue is recognized when a customer obtains control of a good or service), allocation of transaction price based on relative standalone selling price (entities that sell multiple goods or services in a single arrangement must allocate the consideration to each of those goods or services), contract costs (entities sometimes incur costs, such as sales commissions or mobilization activities, to obtain or fulfill a contract), and disclosures (extensive disclosures are required to provide greater insight into both revenue that has been recognized, and revenue that is expected to be recognized in the future from existing contracts). This accounting standard will be effective for the Company beginning in the first quarter of 2017, with no early adoption permitted. This standard may be adopted using either a full retrospective application or a modified retrospective application, where the cumulative effect of initially adopting the standard is recognized as an adjustment to the opening balance of retained earnings. The Company is currently evaluating the impact of this accounting standard on its consolidated financial position, results of operations and cash flows | ||||||||||||
Concentrations of Credit Risk and Significant Customers | ' | |||||||||||
Concentrations of Credit Risk and Significant Customers— Financial instruments that subject the Company to significant concentrations of credit risk primarily consist of cash, cash equivalents, short-term investments and accounts receivable. The Company invests only in high credit quality instruments and maintains its cash, cash equivalents and available-for-sale investments in fixed income securities. Management believes that the financial institutions that hold the Company’s investments are financially sound and, accordingly, are subject to minimal credit risk. Deposits held with banks may exceed the amount of insurance provided on such deposits. The Company’s accounts receivable are primarily derived from distributors and service providers located in the Americas, Europe, and Asia Pacific. The Company generally does not require its customers to provide collateral to support accounts receivable. To reduce credit risk, management performs ongoing credit evaluations of its customers’ financial condition. The Company has recorded an allowance for doubtful accounts for those receivables management has determined to not be collectible. | ||||||||||||
The percentages of revenues from individual customers totaling greater than 10% of total consolidated Company revenues were as follows: | ||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||
Distributor A | 15.8 | % | 17.1 | % | 15.3 | % | 15.4 | % | ||||
Distributor B | 14 | % | 12.8 | % | 13.5 | % | 12 | % | ||||
Distributor C | 11.8 | % | * | 11.8 | % | * | ||||||
* Less than 10% | ||||||||||||
The percentage of receivables from individual customers totaling greater than 10% of total consolidated Company accounts receivable were as follows: | ||||||||||||
June 30, | December 31, | |||||||||||
2014 | 2013 | |||||||||||
Distributor C | 20.5 | % | 10.4 | % | ||||||||
Distributor A | * | 11.6 | % | |||||||||
Distributor D | * | 11.2 | % | |||||||||
* Less than 10% |
DESCRIPTION_OF_BUSINESS_AND_SU2
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended | |||||||||||
Jun. 30, 2014 | ||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||||||
Percentage of Revenue from Individual Customers | ' | |||||||||||
The percentages of revenues from individual customers totaling greater than 10% of total consolidated Company revenues were as follows: | ||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||
Distributor A | 15.8 | % | 17.1 | % | 15.3 | % | 15.4 | % | ||||
Distributor B | 14 | % | 12.8 | % | 13.5 | % | 12 | % | ||||
Distributor C | 11.8 | % | * | 11.8 | % | * | ||||||
* Less than 10% | ||||||||||||
The percentage of receivables from individual customers totaling greater than 10% of total consolidated Company accounts receivable were as follows: | ||||||||||||
June 30, | December 31, | |||||||||||
2014 | 2013 | |||||||||||
Distributor C | 20.5 | % | 10.4 | % | ||||||||
Distributor A | * | 11.6 | % | |||||||||
Distributor D | * | 11.2 | % | |||||||||
* Less than 10% |
FAIR_VALUE_DISCLOSURE_Tables
FAIR VALUE DISCLOSURE (Tables) | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
Assets measured at fair value | ' | |||||||||||||||
The Company’s assets that were measured at fair value by level within the fair value hierarchy were as follows (in thousands): | ||||||||||||||||
30-Jun-14 | ||||||||||||||||
Fair Value | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets | ||||||||||||||||
Money market funds | $ | 31,524 | $ | 31,524 | $ | — | $ | — | ||||||||
Corporate debt securities | 77,224 | — | 77,224 | — | ||||||||||||
Total assets measured and recorded at fair value | $ | 108,748 | $ | 31,524 | $ | 77,224 | $ | — | ||||||||
31-Dec-13 | ||||||||||||||||
Fair Value | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets: | ||||||||||||||||
Money market funds | $ | 47,773 | $ | 47,773 | $ | — | $ | — | ||||||||
Corporate debt securities | 60,878 | — | 60,878 | — | ||||||||||||
Total assets measured and recorded at fair value | $ | 108,651 | $ | 47,773 | $ | 60,878 | $ | — | ||||||||
INVESTMENTS_Tables
INVESTMENTS (Tables) | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ' | |||||||||||||||
Schedule of available-for-sale investments | ' | |||||||||||||||
Investments consisted of the following (in thousands): | ||||||||||||||||
June 30, 2014 | ||||||||||||||||
Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | |||||||||||||
Corporate debt securities | $ | 77,247 | $ | 2 | $ | (25 | ) | $ | 77,224 | |||||||
31-Dec-13 | ||||||||||||||||
Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | |||||||||||||
Corporate debt securities | $ | 60,882 | $ | 9 | $ | (13 | ) | $ | 60,878 | |||||||
Schedule of available-for-sale investments in unrealized loss position | ' | |||||||||||||||
Investments in an unrealized loss position at June 30, 2014 consisted of the following (in thousands): | ||||||||||||||||
Less Than 12 Months | ||||||||||||||||
Fair Value | Unrealized Loss | |||||||||||||||
Corporate debt securities | $ | 34,304 | $ | (25 | ) | |||||||||||
BUSINESS_COMBINATIONS_Tables
BUSINESS COMBINATIONS (Tables) | 6 Months Ended | |||
Jun. 30, 2014 | ||||
Business Combinations [Abstract] | ' | |||
Purchase price allocation | ' | |||
The purchase allocation for YFind is summarized as follows (in thousands): | ||||
Fair Value | ||||
Cash and cash equivalents | $ | 257 | ||
Other tangible assets | 8 | |||
In-process research and development | 6,000 | |||
Goodwill | 914 | |||
Non-current deferred tax liabilities | (1,020 | ) | ||
Other liabilities assumed | (21 | ) | ||
Total purchase consideration | $ | 6,138 | ||
GOODWILL_AND_INTANGIBLES_ASSET1
GOODWILL AND INTANGIBLES ASSETS (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||
Schedule intangible assets | ' | |||||||||||||
Intangible assets consisted of the following (in thousands, except years): | ||||||||||||||
Gross Carrying | Accumulated | Net | Weighted | |||||||||||
Amount | Amortization | Carrying | Average | |||||||||||
Amount | Remaining | |||||||||||||
Life | ||||||||||||||
June 30, 2014: | ||||||||||||||
Purchased technology | $ | 12,600 | $ | (3,839 | ) | $ | 8,761 | 3.0 years | ||||||
December 31, 2013: | ||||||||||||||
Purchased technology | $ | 6,600 | $ | (2,929 | ) | $ | 3,671 | 2.8 years | ||||||
In-process research and development | 6,000 | — | 6,000 | |||||||||||
Total | $ | 12,600 | $ | (2,929 | ) | $ | 9,671 | |||||||
Estimated future amortization of purchased intangible assets | ' | |||||||||||||
Year ending December 31, | Amount | |||||||||||||
2014 (remaining six months) | $ | 1,410 | ||||||||||||
2015 | 2,820 | |||||||||||||
2016 | 2,531 | |||||||||||||
2017 | 1,500 | |||||||||||||
2018 | 500 | |||||||||||||
Total amortization | $ | 8,761 | ||||||||||||
DEFERRED_REVENUE_Tables
DEFERRED REVENUE (Tables) | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Deferred Revenue Disclosure [Abstract] | ' | |||||||
Schedule of deferred revenue | ' | |||||||
Deferred revenue consisted of the following (in thousands): | ||||||||
June 30, | December 31, | |||||||
2014 | 2013 | |||||||
Product | $ | 22,927 | $ | 21,732 | ||||
Service | 24,579 | 18,505 | ||||||
Total deferred revenue | $ | 47,506 | $ | 40,237 | ||||
Reported as: | ||||||||
Current | $ | 38,483 | $ | 33,139 | ||||
Non-current | 9,023 | 7,098 | ||||||
Total deferred revenue | $ | 47,506 | $ | 40,237 | ||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||
Schedule of future minimum lease payments under non-cancellable operating leases | ' | |||||||||||||||
Future minimum lease payments under non-cancelable operating leases were as follows (in thousands): | ||||||||||||||||
Years ending December 31, | Amount | |||||||||||||||
2014 (remaining six months) | $ | 1,841 | ||||||||||||||
2015 | 3,687 | |||||||||||||||
2016 | 2,988 | |||||||||||||||
2017 | 2,646 | |||||||||||||||
2018 | 2,590 | |||||||||||||||
Thereafter | 10,033 | |||||||||||||||
Operating lease obligations | $ | 23,785 | ||||||||||||||
Schedule of changes in warranty liability | ' | |||||||||||||||
The warranty liability is included as a component of accrued liabilities in the accompanying condensed consolidated balance sheets. Changes in the warranty liability were as follows (in thousands): | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Balance at beginning of period | $ | 896 | $ | 774 | $ | 1,038 | $ | 725 | ||||||||
Changes in existing warranty | (207 | ) | (45 | ) | (114 | ) | (25 | ) | ||||||||
Warranty expense | 298 | 113 | 554 | 292 | ||||||||||||
Obligations fulfilled | (140 | ) | (91 | ) | (631 | ) | (241 | ) | ||||||||
Balance at end of period | $ | 847 | $ | 751 | $ | 847 | $ | 751 | ||||||||
EQUITY_AWARD_PLAN_Tables
EQUITY AWARD PLAN (Tables) | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||||
Summary of stock options outstanding | ' | |||||||||||||||
The following table summarizes the outstanding stock option activity and a summary of information related to stock options (in thousands, except per share amounts and years): | ||||||||||||||||
Common Stock Options Outstanding | ||||||||||||||||
Number of | Weighted | Weighted | Aggregate | |||||||||||||
Shares | Average | Average | Intrinsic | |||||||||||||
Exercise Price Per Share | Remaining | Value | ||||||||||||||
Contractual Life (Years) | ||||||||||||||||
Balance, December 31, 2013 | 19,609 | $ | 4.51 | 7.3 | $ | 195,142 | ||||||||||
Options granted | 338 | 11.53 | ||||||||||||||
Options exercised | -1,531 | 2.07 | ||||||||||||||
Options forfeited | -337 | 9.8 | ||||||||||||||
Balance, June 30, 2014 | 18,079 | $ | 4.75 | 6.9 | $ | 139,004 | ||||||||||
Options exercisable as of June 30, 2014 | 11,385 | $ | 3.13 | 6.2 | $ | 102,842 | ||||||||||
Options vested and expected to vest as of June 30, 2014 | 17,833 | $ | 4.67 | 6.9 | $ | 138,073 | ||||||||||
Summary of restricted stock units outstanding | ' | |||||||||||||||
The following table summarizes the outstanding activity of RSUs and a summary of information related to RSUs (in thousands, except per share amounts and years): | ||||||||||||||||
Restricted Stock Units Outstanding | ||||||||||||||||
Number of Shares | Weighted | Weighted | Aggregate | |||||||||||||
Average | Average | Intrinsic | ||||||||||||||
Grant Date Fair Value | Remaining | Value | ||||||||||||||
Per Share | Contractual Life (Years) | |||||||||||||||
Balance, December 31, 2013 | 1,011 | $ | 17.11 | 1.6 | $ | 14,356 | ||||||||||
RSUs granted | 648 | 11.16 | ||||||||||||||
RSUs vested | (178 | ) | 19.67 | |||||||||||||
RSUs forfeited | (50 | ) | 16.27 | |||||||||||||
Balance, June 30, 2014 | 1,431 | $ | 14.12 | 1.5 | $ | 17,039 | ||||||||||
Summary of stock activity and number of shares available for grant | ' | |||||||||||||||
The following table summarizes the stock activity and the total number of shares available for grant under the 2012 Plan as of June 30, 2014 (in thousands): | ||||||||||||||||
Number of | ||||||||||||||||
Shares | ||||||||||||||||
Balance, December 31, 2013 | 8,547 | |||||||||||||||
Additional shares reserved for issuance | 4,035 | |||||||||||||||
RSUs granted | (648 | ) | ||||||||||||||
RSUs forfeited | 50 | |||||||||||||||
Options granted | (338 | ) | ||||||||||||||
Options forfeited | 337 | |||||||||||||||
Balance, June 30, 2014 | 11,983 | |||||||||||||||
Summary of stock options, valuation assumptions | ' | |||||||||||||||
The following table summarizes the weighted average assumptions relating to the Company's stock options: | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Volatility | 63.5 | % | 69.2 | % | 63.8 | % | 70.3 | % | ||||||||
Expected term (years) | 6.1 | 6.1 | 6.1 | 6 | ||||||||||||
Risk-free interest rate | 1.9 | % | 1.7 | % | 1.9 | % | 1.1 | % | ||||||||
Dividend yield | — | — | — | — | ||||||||||||
Summary of Employee Stock Purchase Plan, valuation assumption | ' | |||||||||||||||
The following table summarizes the assumptions relating to the Company's ESPP: | ||||||||||||||||
Six Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | |||||||||||||||
Volatility | 45.8 | % | 57.6 | % | ||||||||||||
Expected term (years) | 0.5 | 0.5 | ||||||||||||||
Risk-free interest rate | 0.1 | % | 0.1 | % | ||||||||||||
Dividend yield | — | — | ||||||||||||||
Schedule of allocation of stock-based compensation expense | ' | |||||||||||||||
The following table summarizes the stock-based compensation expense recorded for stock awards issued to employees and non-employees (in thousands): | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Cost of revenue | $ | 253 | $ | 206 | $ | 498 | $ | 382 | ||||||||
Research and development | 2,126 | 1,479 | 4,222 | 2,778 | ||||||||||||
Sales and marketing | 1,710 | 1,182 | 3,325 | 2,187 | ||||||||||||
General and administrative | 2,251 | 1,446 | 4,641 | 2,996 | ||||||||||||
Total stock-based compensation | $ | 6,340 | $ | 4,313 | $ | 12,686 | $ | 8,343 | ||||||||
EARNINGS_PER_SHARE_Tables
EARNINGS PER SHARE (Tables) | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
Schedule of calculation of basic and diluted net income (loss) per share | ' | |||||||||||||||
The following table presents the calculation of basic and diluted net income per share (in thousands, except per share data): | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Numerator: | ||||||||||||||||
Net income | $ | 1,439 | $ | 702 | $ | 1,712 | $ | 1,016 | ||||||||
Denominator: | ||||||||||||||||
Weighted-average shares used in computing basic net income per share | 82,315 | 75,352 | 81,799 | 74,779 | ||||||||||||
Weighted-average effect of potentially dilutive shares: | ||||||||||||||||
Employee stock options | 9,994 | 17,155 | 11,032 | 18,662 | ||||||||||||
RSUs and ESPP | 49 | 88 | 136 | 208 | ||||||||||||
Diluted | 92,358 | 92,595 | 92,967 | 93,649 | ||||||||||||
Net income per share: | ||||||||||||||||
Basic | $ | 0.02 | $ | 0.01 | $ | 0.02 | $ | 0.01 | ||||||||
Diluted | $ | 0.02 | $ | 0.01 | $ | 0.02 | $ | 0.01 | ||||||||
Summary of the outstanding redeemable convertible preferred stock, employee stock, employee stock options, RSUs and warrants excluded from the diluted per share calculation | ' | |||||||||||||||
The following table summarizes the weighted average outstanding stock awards that were excluded from the diluted per share calculation because to include them would have been anti-dilutive for the period (in thousands): | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Stock options | 2,419 | 807 | 2,333 | 736 | ||||||||||||
RSUs and ESPP | 946 | 317 | 772 | 206 | ||||||||||||
Total | 3,365 | 1,124 | 3,105 | 942 | ||||||||||||
SEGEMENT_INFORMATION_Tables
SEGEMENT INFORMATION (Tables) | 6 Months Ended | |||||||||||||||
Jun. 30, 2014 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Schedule of total revenue by geographic region | ' | |||||||||||||||
The following presents total revenue by geographic region (in thousands): | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Americas: | ||||||||||||||||
United States | $ | 39,667 | $ | 30,403 | $ | 78,142 | $ | 53,979 | ||||||||
Other Americas | 2,274 | 3,519 | 4,286 | 5,398 | ||||||||||||
Total Americas | 41,941 | 33,922 | 82,428 | 59,377 | ||||||||||||
EMEA: | ||||||||||||||||
United Kingdom | 6,691 | 6,795 | 12,605 | 13,784 | ||||||||||||
Other EMEA | 14,728 | 9,807 | 28,866 | 18,433 | ||||||||||||
Total EMEA | 21,419 | 16,602 | 41,471 | 32,217 | ||||||||||||
APAC: | ||||||||||||||||
Total APAC | 17,640 | 13,349 | 32,153 | 29,520 | ||||||||||||
Total revenue | 81,000 | 63,873 | 156,052 | 121,114 | ||||||||||||
DESCRIPTION_OF_BUSINESS_AND_SU3
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Concentration of Credit Risk and Significant Customers) (Details) | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | |
Revenues | Revenues | Revenues | Revenues | Revenues | Revenues | Revenues | Revenues | Revenues | Revenues | Accounts Receivables | Accounts Receivables | Accounts Receivables | Accounts Receivables | |
Distributor A | Distributor A | Distributor A | Distributor A | Distributor B | Distributor B | Distributor B | Distributor B | Distributor C | Distributor C | Distributor A | Distributor C | Distributor C | Distributor D | |
Revenue, Major Customer | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Significant customer, as a percentage | 15.80% | 17.10% | 15.30% | 15.40% | 14.00% | 12.80% | 13.50% | 12.00% | 11.80% | 11.80% | 11.60% | 20.50% | 10.40% | 11.20% |
FAIR_VALUE_DISCLOSURE_Details
FAIR VALUE DISCLOSURE (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Fair Value | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Total assets measured and recorded at fair value | $108,748 | $108,651 |
Fair Value | Corporate debt securities | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Short-term investments, at fair value | 77,224 | 60,878 |
Fair Value | Money Market Funds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Cash equivalents, at fair value | 31,524 | 47,773 |
Level 1 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Total assets measured and recorded at fair value | 31,524 | 47,773 |
Level 1 | Corporate debt securities | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Short-term investments, at fair value | 0 | 0 |
Level 1 | Money Market Funds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Cash equivalents, at fair value | 31,524 | 47,773 |
Level 2 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Total assets measured and recorded at fair value | 77,224 | 60,878 |
Level 2 | Corporate debt securities | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Short-term investments, at fair value | 77,224 | 60,878 |
Level 2 | Money Market Funds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Cash equivalents, at fair value | 0 | 0 |
Level 3 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Total assets measured and recorded at fair value | 0 | 0 |
Level 3 | Corporate debt securities | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Short-term investments, at fair value | 0 | 0 |
Level 3 | Money Market Funds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ' | ' |
Cash equivalents, at fair value | $0 | $0 |
INVESTMENTS_Details
INVESTMENTS (Details) (Corporate debt securities, USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Corporate debt securities | ' | ' |
Schedule of Available-for-sale Securities | ' | ' |
Amortized Cost | $77,247 | $60,882 |
Unrealized Gains | 2 | 9 |
Unrealized Losses | -25 | -13 |
Fair Value | $77,224 | $60,878 |
INVESTMENTS_Continuous_Unreali
INVESTMENTS (Continuous Unrealized Losses) (Details) (Corporate debt securities, USD $) | Jun. 30, 2014 |
In Thousands, unless otherwise specified | |
Corporate debt securities | ' |
Schedule of Available-for-sale Securities | ' |
Less than 12 months, Fair Value | $34,304 |
Less than 12 months, Unrealized Loss | ($25) |
BUSINESS_COMBINATIONS_Details
BUSINESS COMBINATIONS (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | Jul. 18, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jul. 18, 2013 | Jul. 18, 2013 | Jul. 18, 2013 |
YFind | YFind | YFind | YFind | YFind | YFind | |||
Minimum | Maximum | RSU | ||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase consideration paid in cash | ' | ' | $6,138,000 | ' | ' | ' | ' | ' |
Awards granted (in shares) | ' | ' | ' | ' | ' | ' | ' | 219,782 |
Options granted (in shares) | ' | ' | 51,900 | ' | ' | ' | ' | ' |
Vesting period for equity awards | ' | ' | ' | ' | ' | '3 years | '4 years | ' |
Fair value of equity awards | ' | ' | 3,600,000 | ' | ' | ' | ' | ' |
Maximum obligation to pay retention bonuses | ' | ' | 400,000 | ' | ' | ' | ' | ' |
Payment period for retention bonuses | ' | ' | '2 years | ' | ' | ' | ' | ' |
Compensation costs related to acquisition | ' | ' | ' | 400,000 | 700,000 | ' | ' | ' |
Purchase Allocation | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | ' | ' | 257,000 | ' | ' | ' | ' | ' |
Other tangible assets | ' | ' | 8,000 | ' | ' | ' | ' | ' |
In-process research and development | ' | ' | 6,000,000 | ' | ' | ' | ' | ' |
Goodwill | 9,945,000 | 9,945,000 | 914,000 | ' | ' | ' | ' | ' |
Noncurrent deferred tax liabilities | ' | ' | -1,020,000 | ' | ' | ' | ' | ' |
Other liabilities assumed | ' | ' | -21,000 | ' | ' | ' | ' | ' |
Total purchase consideration | ' | ' | $6,138,000 | ' | ' | ' | ' | ' |
GOODWILL_AND_INTANGIBLES_ASSET2
GOODWILL AND INTANGIBLES ASSETS (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | Jul. 18, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Jul. 18, 2013 |
In Thousands, unless otherwise specified | YFind | Purchased technology | Purchased technology | In-process research and development | In-process research and development | ||
YFind | |||||||
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Gross Carrying Amount | ' | ' | ' | $12,600 | $6,600 | ' | ' |
Accumulated amortization | ' | -2,929 | ' | -3,839 | -2,929 | ' | ' |
Finite-lived intangible assets, net | 8,761 | ' | ' | 8,761 | 3,671 | ' | ' |
Indefinite-lived intangible assets | ' | ' | ' | ' | ' | 6,000 | 6,000 |
Intangible Assets, Gross | ' | 12,600 | ' | ' | ' | ' | ' |
Intangible assets, net | 8,761 | 9,671 | ' | ' | ' | ' | ' |
Weighted average remaining useful life | ' | ' | ' | '3 years | '2 years 10 months | ' | ' |
Goodwill | $9,945 | $9,945 | $914 | ' | ' | ' | ' |
GOODWILL_AND_INTANGIBLES_ASSET3
GOODWILL AND INTANGIBLES ASSETS (Future Amortization Expense) (Details) (USD $) | Jun. 30, 2014 |
In Thousands, unless otherwise specified | |
Estimated Future Amortization Expense By Fiscal Year Maturity | ' |
2014 (remaining six months) | $1,410 |
2015 | 2,820 |
2016 | 2,531 |
2017 | 1,500 |
2018 | 500 |
Finite-lived intangible assets, net | $8,761 |
DEFERRED_REVENUE_Details
DEFERRED REVENUE (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | Product | Product | Services | Services | Services | Services | ||
Minimum | Maximum | |||||||
Deferred Revenue Arrangement [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred revenue | $47,506 | $40,237 | $22,927 | $21,732 | $24,579 | $18,505 | ' | ' |
Current | 38,483 | 33,139 | ' | ' | ' | ' | ' | ' |
Noncurrent | $9,023 | $7,098 | ' | ' | ' | ' | ' | ' |
Typical service support period, minimum | ' | ' | ' | ' | ' | ' | '1 year | '5 years |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Operating Leases, Purchase Commitments, and Litigation) (Details) (USD $) | 6 Months Ended |
Jun. 30, 2014 | |
Operating Leases, Future Minimum Payments [Abstract] | ' |
2014 (remaining six months) | $1,841,000 |
2015 | 3,687,000 |
2016 | 2,988,000 |
2017 | 2,646,000 |
2018 | 2,590,000 |
Thereafter | 10,033,000 |
Operating lease obligation | 23,785,000 |
Gain on settlement of several patent litigation claims | 800,000 |
Current purchase commitments | $18,100,000 |
COMMITMENTS_AND_CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Product Liabilities) (Details) (USD $) | 3 Months Ended | 6 Months Ended | 6 Months Ended | 1 Months Ended | |||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Apr. 30, 2013 |
Hardware other than Indoor WLAN Products | Indemnification Agreement [Member] | ||||||
Product Liability | ' | ' | ' | ' | ' | ' | ' |
Restricted cash for indemnity obligation | $5,000 | ' | $5,000 | ' | $5,000 | ' | ' |
Indemnification Period | ' | ' | ' | ' | ' | ' | '6 years |
Standard product warranty term | ' | ' | ' | ' | ' | '1 year | ' |
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward] | ' | ' | ' | ' | ' | ' | ' |
Beginning warranty liability | 896 | 774 | 1,038 | 725 | ' | ' | ' |
Changes in existing warranty | -207 | -45 | -114 | -25 | ' | ' | ' |
Warranty expense | 298 | 113 | 554 | 292 | ' | ' | ' |
Obligations fulfilled | -140 | -91 | -631 | -241 | ' | ' | ' |
Ending warranty liability | $847 | $751 | $847 | $751 | ' | ' | ' |
EQUITY_AWARD_PLAN_Stock_Option
EQUITY AWARD PLAN (Stock Option Activity) (Details) (Stock Options, USD $) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | |
Stock Options | ' | ' | ' | ' | ' |
Number of Shares | ' | ' | ' | ' | ' |
Beginning balance (shares) | ' | ' | 19,609,000 | ' | ' |
Options granted (shares) | ' | ' | 338,000 | ' | ' |
Options exercised (shares) | ' | ' | -1,531,000 | ' | ' |
Options forfeited (shares) | ' | ' | -337,000 | ' | ' |
Ending balance (shares) | 18,079,000 | ' | 18,079,000 | ' | 19,609,000 |
Options exercisable (shares) | 11,385,000 | ' | 11,385,000 | ' | ' |
Options vested and expected to vest (shares) | 17,833,000 | ' | 17,833,000 | ' | ' |
Weighted Average Exercise Price | ' | ' | ' | ' | ' |
Beginning balance (in dollars per share) | ' | ' | $4.51 | ' | ' |
Options granted (in dollars per share) | ' | ' | $11.53 | ' | ' |
Options exercised (in dollars per share) | ' | ' | $2.07 | ' | ' |
Options forfeited (in dollars per share) | ' | ' | $9.80 | ' | ' |
Ending balance (in dollars per share) | $4.75 | ' | $4.75 | ' | $4.51 |
Options exercisable (in dollars per share) | $3.13 | ' | $3.13 | ' | ' |
Options vested and expected to vest (in dollars per share) | $4.67 | ' | $4.67 | ' | ' |
Weighted Average Remaining Contractual Life | ' | ' | ' | ' | ' |
Weighted Average Remaining Contractual Life | ' | ' | '6 years 10 months 23 days | ' | '7 years 3 months 20 days |
Options exercisable | ' | ' | '6 years 2 months 20 days | ' | ' |
Options vested and expected to vest | ' | ' | '6 years 10 months 18 days | ' | ' |
Aggregate Intrinsic Value | ' | ' | ' | ' | ' |
Aggregate Intrinsic Value | $139,004,000 | ' | $139,004,000 | ' | $195,142,000 |
Options exercisable | 102,842,000 | ' | 102,842,000 | ' | ' |
Options vested and expected to vest | 138,073,000 | ' | 138,073,000 | ' | ' |
Weighted average grant date fair value (in dollars per share) | $6.26 | $10.98 | $6.84 | $12.91 | ' |
Total intrinsic value of options exercised | $3,400,000 | $25,000,000 | $16,700,000 | $25,600,000 | ' |
EQUITY_AWARD_PLAN_Restricted_S
EQUITY AWARD PLAN (Restricted Stock Units Activity) (Details) (RSU, USD $) | 6 Months Ended | 12 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2013 |
RSU | ' | ' |
Number of Shares | ' | ' |
Beginning balance (shares) | 1,011 | ' |
RSUs granted (shares) | 648 | ' |
RSUs exercised (shares) | -178 | ' |
RSUs forfeited (shares) | -50 | ' |
Ending balance (shares) | 1,431 | 1,011 |
Weighted-Average Grant- Date Fair Value Per Share | ' | ' |
Beginning balance (in dollars per share) | $17.11 | ' |
RSUs granted (in dollars per share) | $11.16 | ' |
RSUs vested (in dollars per share) | $19.67 | ' |
RSUs forfeited (in dollars per share) | $16.27 | ' |
Ending balance (in dollars per share) | $14.12 | $17.11 |
RSU, Weighted Average Remaining Contractual Life | '1 year 5 months 23 days | '1 year 7 months 7 days |
Aggregate Intrinsic Value | ' | ' |
Aggregate Intrinsic Value | $17,039 | $14,356 |
EQUITY_AWARD_PLAN_Stock_Activi
EQUITY AWARD PLAN (Stock Activity and Number of Shares Available for Grant) (Details) | 6 Months Ended |
Jun. 30, 2014 | |
Shares Available for Grant | ' |
Beginning balance (shares) | 8,547,000 |
Additional shares reserved for issuance (shares) | 4,035,000 |
Ending balance (shares) | 11,983,000 |
RSU | ' |
Shares Available for Grant | ' |
RSUs granted (shares) | -648,000 |
RSUs forfeited (shares) | 50,000 |
Stock Options | ' |
Shares Available for Grant | ' |
Options granted (shares) | -338,000 |
Options forfeited (shares) | 337,000 |
EQUITY_AWARD_PLAN_Assumptions_
EQUITY AWARD PLAN (Assumptions) (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Stock Options | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award | ' | ' | ' | ' |
Volatility | 63.50% | 69.20% | 63.80% | 70.30% |
Expected term (years) | '6 years 0 months 28 days | '6 years 0 months 28 days | '6 years 0 months 28 days | '6 years 0 months 11 days |
Risk-free interest rate | 1.90% | 1.70% | 1.90% | 1.10% |
Dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Employee Stock Purchase Plan | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award | ' | ' | ' | ' |
Volatility | ' | ' | 45.80% | 57.60% |
Expected term (years) | ' | ' | '6 months 1 day | '6 months 1 day |
Risk-free interest rate | ' | ' | 0.10% | 0.10% |
EQUITY_AWARD_PLAN_Stockbased_C
EQUITY AWARD PLAN (Stock-based Compensation Expense) (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ' | ' | ' | ' |
Total stock-based compensation | $6,340,000 | $4,313,000 | $12,686,000 | $8,343,000 |
Compensation cost not yet recognized | 46,200,000 | ' | 46,200,000 | ' |
Compensation cost not yet recognized, period for recognition | ' | ' | '2 years | ' |
Cost of revenue | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ' | ' | ' | ' |
Total stock-based compensation | 253,000 | 206,000 | 498,000 | 382,000 |
Research and development | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ' | ' | ' | ' |
Total stock-based compensation | 2,126,000 | 1,479,000 | 4,222,000 | 2,778,000 |
Sales and marketing | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ' | ' | ' | ' |
Total stock-based compensation | 1,710,000 | 1,182,000 | 3,325,000 | 2,187,000 |
General and administrative | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ' | ' | ' | ' |
Total stock-based compensation | $2,251,000 | $1,446,000 | $4,641,000 | $2,996,000 |
EARNINGS_PER_SHARE_Calculation
EARNINGS PER SHARE (Calculation of Basic and Diluted Net Income Per Share) (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Numerator: | ' | ' | ' | ' |
Net income | $1,439 | $702 | $1,712 | $1,016 |
Denominator: | ' | ' | ' | ' |
Basic (in shares) | 82,315 | 75,352 | 81,799 | 74,779 |
Weighted-average effect of potentially dilutive shares: | ' | ' | ' | ' |
Employee stock options | 9,994 | 17,155 | 11,032 | 18,662 |
RSUs and ESPP | 49 | 88 | 136 | 208 |
Diluted (in shares) | 92,358 | 92,595 | 92,967 | 93,649 |
Net income per share of common stock: | ' | ' | ' | ' |
Basic (USD per share) | $0.02 | $0.01 | $0.02 | $0.01 |
Diluted (USD per share) | $0.02 | $0.01 | $0.02 | $0.01 |
EARNINGS_PER_SHARE_Antidilutiv
EARNINGS PER SHARE (Antidilutive Securities) (Details) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ' | ' | ' |
Shares excluded from the diluted per share calculation | 3,365 | 1,124 | 3,105 | 942 |
Stock Options | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ' | ' | ' |
Shares excluded from the diluted per share calculation | 2,419 | 807 | 2,333 | 736 |
RSU | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ' | ' | ' |
Shares excluded from the diluted per share calculation | 946 | 317 | 772 | 206 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Income Tax Disclosure [Abstract] | ' | ' | ' | ' |
Income tax expense (benefit) | $2,658 | $251 | $3,356 | ($284) |
SEGEMENT_INFORMATION_Details
SEGEMENT INFORMATION (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
segment | ||||
Segment Reporting [Abstract] | ' | ' | ' | ' |
Number of industry segments | ' | ' | 1 | ' |
Revenues from External Customers and Long-Lived Assets | ' | ' | ' | ' |
Revenue | $81,000 | $63,873 | $156,052 | $121,114 |
Americas | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets | ' | ' | ' | ' |
Revenue | 41,941 | 33,922 | 82,428 | 59,377 |
United States | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets | ' | ' | ' | ' |
Revenue | 39,667 | 30,403 | 78,142 | 53,979 |
Other Americas | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets | ' | ' | ' | ' |
Revenue | 2,274 | 3,519 | 4,286 | 5,398 |
EMEA | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets | ' | ' | ' | ' |
Revenue | 21,419 | 16,602 | 41,471 | 32,217 |
United Kingdom | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets | ' | ' | ' | ' |
Revenue | 6,691 | 6,795 | 12,605 | 13,784 |
Other EMEA | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets | ' | ' | ' | ' |
Revenue | 14,728 | 9,807 | 28,866 | 18,433 |
APAC | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets | ' | ' | ' | ' |
Revenue | $17,640 | $13,349 | $32,153 | $29,520 |
SEGEMENT_INFORMATION_Property_
SEGEMENT INFORMATION (Property, Plant, and Equipment by Geographic Region) (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Segment Reporting Information | ' | ' |
Property and equipment, net | $12,365 | $11,472 |
Americas | ' | ' |
Segment Reporting Information | ' | ' |
Property and equipment, net | 7,700 | ' |
APAC | ' | ' |
Segment Reporting Information | ' | ' |
Property and equipment, net | 4,100 | ' |
EMEA | ' | ' |
Segment Reporting Information | ' | ' |
Property and equipment, net | $600 | ' |