Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | Apr. 27, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | ATRC | |
Entity Registrant Name | AtriCure, Inc. | |
Entity Central Index Key | 1,323,885 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 33,094,148 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 20,768 | $ 23,764 |
Short-term investments | 2,556 | 10,814 |
Accounts receivable, less allowance for doubtful accounts of $129 and $136, respectively | 19,446 | 19,409 |
Inventories | 19,015 | 17,659 |
Other current assets | 3,608 | 3,106 |
Total current assets | 65,393 | 74,752 |
Property and equipment, net | 31,155 | 31,279 |
Long-term investments | 6,150 | 7,706 |
Intangible assets, net | 53,364 | 53,775 |
Goodwill | 105,257 | 105,257 |
Other noncurrent assets | 391 | 323 |
Total Assets | 261,710 | 273,092 |
Current liabilities: | ||
Accounts payable | 12,801 | 12,744 |
Accrued liabilities | 12,931 | 18,394 |
Other current liabilities and current maturities of capital leases | 462 | 450 |
Total current liabilities | 26,194 | 31,588 |
Capital leases | 13,592 | 13,710 |
Other noncurrent liabilities | 40,897 | 41,109 |
Total Liabilities | $ 80,683 | $ 86,407 |
Commitments and contingencies (Note 7) | ||
Stockholders' Equity: | ||
Common stock, $0.001 par value, 90,000 shares authorized and 33,084 and 32,274 issued and outstanding, respectively | $ 33 | $ 32 |
Additional paid-in capital | 356,638 | 352,900 |
Accumulated other comprehensive loss | (284) | (611) |
Accumulated deficit | (175,360) | (165,636) |
Total Stockholders' Equity | 181,027 | 186,685 |
Total Liabilities and Stockholders' Equity | $ 261,710 | $ 273,092 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Condensed Consolidated Balance Sheets [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 129 | $ 136 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 90,000,000 | 90,000,000 |
Common stock, shares issued | 33,084,000 | 32,274,000 |
Common stock, shares outstanding | 33,084,000 | 32,274,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Condensed Consolidated Statements of Operations and Comprehensive Loss [Abstract] | ||
Revenue | $ 35,940 | $ 29,886 |
Cost of revenue | 10,026 | 8,151 |
Gross profit | 25,914 | 21,735 |
Operating expenses: | ||
Research and development expenses | 8,563 | 5,609 |
Selling, general and administrative expenses | 26,770 | 21,270 |
Total operating expenses | 35,333 | 26,879 |
Loss from operations | (9,419) | (5,144) |
Other income (expense): | ||
Interest expense | (259) | (18) |
Interest income | 39 | 43 |
Other | (80) | (141) |
Loss before income tax expense | (9,719) | (5,260) |
Income tax expense | 5 | 6 |
Net loss | $ (9,724) | $ (5,266) |
Basic and diluted net loss per share | $ (0.31) | $ (0.19) |
Weighted average shares outstanding-basic and diluted | 31,358 | 27,069 |
Comprehensive loss: | ||
Unrealized gains on investments | $ 41 | $ 37 |
Foreign currency translation adjustment | 286 | (487) |
Other comprehensive income (loss) | 327 | (450) |
Net loss | (9,724) | (5,266) |
Comprehensive loss | $ (9,397) | $ (5,716) |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (9,724) | $ (5,266) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Share-based compensation expense | 2,842 | 1,724 |
Depreciation | 1,800 | 1,008 |
Amortization of intangible assets | 411 | 303 |
Amortization of deferred financing costs | 15 | 16 |
Loss on disposal of property and equipment | 141 | 57 |
Realized (gain) loss from foreign exchange on intercompany transactions | (5) | 251 |
Amortization/accretion on investments | 56 | 184 |
Change in allowance for doubtful accounts | 100 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | 30 | (2,685) |
Inventories | (1,232) | (1,104) |
Other current assets | (439) | (779) |
Accounts payable | 1,034 | 2,124 |
Accrued liabilities | (5,569) | (4,931) |
Other noncurrent assets and liabilities | (291) | 28 |
Net cash used in operating activities | (10,931) | (8,970) |
Cash flows from investing activities: | ||
Purchases of available-for-sale securities | (6,086) | |
Sales and maturities of available-for-sale securities | 9,800 | 11,899 |
Purchases of property and equipment | (2,804) | (1,434) |
Increases in property under build-to-suit obligation | (1,822) | |
Net cash provided by investing activities | 6,996 | 2,557 |
Cash flows from financing activities: | ||
Payments on capital leases | (107) | (14) |
Increases in build-to-suit obligation | 1,822 | |
Proceeds from stock option exercises | 1,896 | 516 |
Shares repurchased for payment of taxes on stock awards | (999) | (503) |
Net cash provided by financing activities | 790 | 1,821 |
Effect of exchange rate changes on cash and cash equivalents | 149 | (233) |
Net decrease in cash and cash equivalents | (2,996) | (4,825) |
Cash and cash equivalents-beginning of period | 23,764 | 28,384 |
Cash and cash equivalents-end of period | 20,768 | 23,559 |
Supplemental cash flow information: | ||
Cash paid for interest | 244 | 2 |
Non-cash investing and financing activities: | ||
Accrued purchases of property and equipment | $ 243 | 751 |
Assets acquired through capital lease | $ 36 |
Description of Business and Sum
Description of Business and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2016 | |
Description of Business and Summary of Significant Accounting Policies [Abstract] | |
Description of Business and Summary of Significant Accounting Policies | 1. DESC RIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of the Business —AtriCure, Inc. was incorporated in the State of Delaware on October 31, 2000. The “Company” or “AtriCure” consists of AtriCure, Inc. and its wholly-owned subsidiaries. The Company is a leading atrial fibrillation (Afib) solutions partner providing innovative products, professional education and support for clinical science to reduce the economic and social burden of atrial fibrillation. The Company sells its products to medical centers globally through a direct sales force and distributors. Basis of Presentation —The accompanying interim financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (SEC). The accompanying interim financial statements are unaudited, but in the opinion of the Company’s management, contain all of the normal, recurring adjustments considered necessary to present fairly the financial position, results of operations and cash flows for the periods presented in conformity with accounting principles generally accepted in the United States of America (GAAP) applicable to interim periods. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted or condensed. The Company believes the disclosures herein are adequate to make the information presented not misleading. Results of operations are not necessarily indicative of the results expected for the full fiscal year or for any future period. The accompanying Condensed Consolidated Financial Statements should be read in conjunction with the audited financial statements of the Company included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 filed with the SEC. Principles of Consolidation —The Condensed Consolidated Financial Statements include the accounts of the Company, AtriCure, LLC, Endoscopic Technologies, LLC and nContact Surgical, LLC, the Company’s wholly-owned subsidiar ies, all organized in the State of Delaware, and AtriCure Europe B.V. (AtriCure Europe), the Company’s wholly-owned subsidiary incorporated in the Netherlands. All intercompany accounts and transactions have been eliminated in consolidation. Cash and Cash Equivalents —The Company considers highly liquid investments with maturities of three months or less at the date of acquisition as cash equivalents in the accompanying Condensed Consolidated Financial Statements. Investments —The Company places its investments primarily in U.S. Government agencies and securities, corporate bonds and commercial paper. The Company classifies all investments as available-for-sale. Investments with maturities of less than one year are classified as short-term investments. Investments are recorded at fair value, with unrealized gains and losses recorded as accumulated other comprehensive income (loss). The Company recognizes gains and losses when these securities are sold using the specific identification method and includes them in interest income or expense in the Condensed Consolidated Statements of Operations and Comprehensive Loss. Revenue Recognition —The Company accounts for revenue in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 605, “Revenue Recognition” (ASC 605). The Company recognizes revenue when all of the following criteria are met: (i) there is persuasive evidence that an arrangement exists; (ii) delivery of the products and/or services has occurred; (iii) the selling price is fixed or determinable; and (iv) collectability is reasonably assured. Pursuant to the Company’s standard terms of sale, revenue is recognized when title to the goods and risk of loss transfers to customers and there are no remaining obligations that will affect the customers’ final acceptance of the sale. Generally, the Company’s standard terms of sale define the transfer of title and risk of loss to occur upon shipment to the respective customer. The Company generally does not maintain any post-shipping obligations to the recipients of the products. No installation, calibration or testing of products is performed by the Company subsequent to shipment to the customer in order to render it operational. Revenue includes shipping and handling revenue of $296 and $247 for the three months ended March 31, 2016 and 2015 , respectively. Cost of freight for shipments made to customers is included in cost of revenue. Sales and other value-added taxes collected from customers and remitted to governmental authorities are excluded from revenue. The Company sells its products primarily through a direct sales force, with certain international markets sold through distributors. Terms of sale are generally consistent for both end-users and distributors except that payment terms are generally net 30 days for end-users and net 60 days for distributors with limited exceptions. Sales Returns and Allowances —The Company maintains a provision for sales returns and allowances to account for potential returns of defective or damaged products, products shipped in error and invoice adjustments. The Company estimates such provision on a quarterly basis based primarily on specific identification, in addition to estimating a general reserve based on historical experience. Increases to the provision result in a reduction of revenue. The provision is included in accrued liabilities in the Condensed Consolidated Balance Sheets. Allowance for Doubtful Accounts Receivable —The Company evaluates the collectability of accounts receivable to determine the appropriate reserve for doubtful accounts. In determining the amount of the reserve, the Company considers aging of account balances, historical credit losses, customer-specific information and other relevant factors. An increase to the allowance for doubtful accounts results in a corresponding increase in selling, general and administrative expense. The Company reviews accounts receivable and adjusts the allowance based on current circumstances and charges off uncollectible receivables against the allowance when all attempts to collect the receivable have failed. The Company’s history of write-offs against the allowance has not been significant. Inventories —Inventories are stated at the lower of cost or market using approximate costs based on the first-in, first-out cost method (FIFO) . Inventories consist of raw materials, work in process and finished goods. The Company’s industry is characterized by rapid product development and frequent new product introductions. Uncertain timing of product approvals, variability in product launch strategies and variation in product utilization all impact excess and obsolete inventory. An inventory allowance based on product usage is estimated and recorded quarterly for excess, slow moving and obsolete inventory, as well as inventory with a carrying value in excess of its net realizable value. An increase to the inventory reserve allowance results in a corresponding increase in cost of revenue. Write-offs are recorded when a product is destroyed. The Company’s history of write-offs against the reserve has not been significant. Inventories consist of the following: March 31, December 31, 2016 2015 Raw materials $ 6,228 $ 6,159 Work in process 2,023 974 Finished goods 10,764 10,526 Inventories $ 19,015 $ 17,659 Property and Equipment —Property and equipment is stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method of depreciation for financial reporting purposes and is applied over the estimated useful lives of the assets. The estimated useful life by major asset category is the following: generators and other capital equipment, machinery, equipment and vehicles is three to seven years, computer and other office equipment is three years, furniture and fixtures is three to seven years and leasehold improvements and equipment under capital leases are the shorter of their useful life or remaining lease term. The Company reassesses the useful lives of property and equipment annually, and assets are retired if they are no longer in service. Maintenance and repair costs are expensed as incurred. Generators and other capital equipment (such as the Company’s switchbox units and cryosurgical consoles) are placed with direct customers that use the Company’s disposable products. Depreciation of such assets is included in cost of revenue. The estimated useful lives of this equipment are based on anticipated usage by customers and the timing and impact of expected new technology rollouts by the Company. To the extent the Company experiences changes in the usage of this equipment or introduces new technologies, the estimated useful lives of this equipment may change in a future period. Depreciation related to these generators was $836 and $620 for the three months ended March 31, 2016 and 2015 , respectively. As of March 31, 2016 and December 31, 2015 , the net carrying amount of loaned equipment included in net property and equipment in the Condensed Consolidated Balance Sheets was $5,393 and $5,447 , respectively. The Company reviews property and equipment for impairment using its best estimates based on reasonable and supportable assumptions and projections. Intangible Assets —Intangible assets with determinable useful lives are amortized on a straight-line basis over the estimated periods benefited. Included in intangible assets is In Process Research and Development (IPR&D). The Company defines IPR&D as the value of acquired technology which has not yet reached technological feasibility. The primary basis for determining the technological feasibility is obtaining specific regulatory approvals. The estimated fair value of IPR&D acquired in a business combination is capitalized as an indefinite-lived intangible asset until completion or abandonment of the IPR&D project. Upon completion of the development project, the IPR&D is amortized over its estimated useful life. If the IPR&D project is abandoned, the related IPR&D asset is written off. The estimated fair value of IPR&D was determined using an income approach model. IPR&D represents an estimate of the fair value of the PMA approval that could result from the CONVERGE IDE clinical trial. The Company reviews intangible assets for impairment using its best estimates based on reasonable and supportable assumptions and projections. Goodwill— Goodwill represents the excess of purchase price over the fair value of the net assets acquired in business combinations. The Company tests goodwill for impairment annually on November 30, or more often if impairment indicators are present. The Company’s goodwill is accounted for in a single reporting unit representing the Company as a whole. Other Current Liabilities and Current Maturities of Capital Leases— As of March 31, 201 6 , o ther current liabilities consisted of a financing obligation related to the construction of the Company’s new headquarters. Current maturities of capital leases consist of capital lease obligations with maturities of less than one year (see Note 6 – Indebtedness). Other Noncurrent Liabilities— Other noncurrent liabilities include contingent consideration recorded in business combinations, as well as long-term deferred revenues and other contractual obligations. Other Income — Other income consists primarily of foreign currency transaction gains and losses. The Company recorded net foreign currency transaction gains (losses) of $(80) and $(163) for the three months ended March 31, 2016 and 2015 , respectively, in connection with settlements of its intercompany balance with AtriCure Europe and invoices transacted in British Pounds. Taxes —Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities from a change in tax rates is recognized in the period that includes the enactment date. The Company’s estimate of the valuation allowance for deferred tax assets requires it to make significant estimates and judgments about its future operating results. Deferred tax assets are reduced by valuation allowances if, based on the consideration of all available evidence, it is more-likely-than-not that some portion of the deferred tax asset will not be realized. Significant weight is given to evidence that can be objectively verified. The Company evaluates deferred tax assets on a quarterly basis to determine if valuation allowances are required by considering all available evidence. Deferred tax assets are realized by having sufficient future taxable income to allow the related tax benefits to reduce taxes otherwise payable. The sources of taxable income that may be available to realize the benefit of deferred tax assets are future reversals of existing taxable temporary differences, future taxable income, exclusive of reversing temporary differences and carryforwards, taxable income in carry-back years and tax planning strategies that are both prudent and feasible. In evaluating whether to record a valuation allowance, the applicable accounting standards deem that the existence of cumulative losses in recent years is a significant piece of objectively verifiable negative evidence that must be overcome by objectively verifiable positive evidence to avoid the need to record a valuation allowance. The Company has recorded a full valuation allowance against its net deferred tax assets as it is more likely than not that the benefit of the deferred tax assets will not be recognized in future periods. A provision of The Patient Protection and Affordable Care Act enacted in 2010, as amended (Patient Act), requires manufacturers of medical devices to pay an excise tax on all U.S. medical device sales. In December 2015, the U.S. gove rnment approved the suspension of the excise tax on medical device sales beginning January 1, 2016 through December 31, 2017. The Company’s expense related to the medical device excise tax, which was recorded in cost of revenue, was $0 and $155 for the three months ended March 31, 2016 and 2015 , respectively. Net Loss Per Share —Basic and diluted net loss per share is computed in accordance with FASB ASC 260, “Earnings Per Share” (ASC 260) by dividing the net loss by the weighted average number of common shares outstanding during the period. Since the Company has experienced net losses for all periods presented, net loss per share excludes the effect of 4,480 and 4,320 stock options and restricted stock shares as of March 31, 2016 and 2015 , respectively, because they are anti-dilutive. Therefore the number of shares calculated for basic net loss per share is also used for the diluted net loss per share calculation. Comprehensive Loss and Accumulated Other Comprehensive Loss —In addition to net losses, the comprehensive loss includes foreign currency translation adjustments and unrealized gains and losses on investments. Accumulated other comprehensive income (loss) consisted of the following: Three Months Ended March 31, 2016 2015 Total accumulated other comprehensive loss at beginning of period $ (611) $ (348) Unrealized Gains on Investments Balance at beginning of period $ (39) $ (54) Other comprehensive income (loss) before reclassifications 41 37 Amounts reclassified from accumulated other comprehensive income to other income on the statement of operations — — Balance at end of period $ 2 $ (17) Foreign Currency Translation Adjustment Balance at beginning of period $ (572) $ (294) Other comprehensive income (loss) before reclassifications 281 (324) Amounts reclassified from accumulated other comprehensive income to other income on the statement of operations 5 (163) Balance at end of period $ (286) $ (781) Total accumulated other comprehensive loss at end of period $ (284) $ (798) Research and Development —Research and development costs are expensed as incurred. These costs include compensation and other internal and external costs associated with the development and research related to new and existing products or concepts, preclinical studies, clinical trials, healthcare compliance and regulatory affairs. Advertising Costs — The Company expenses advertising costs as incurred. Advertising costs were not significant during the three months ended March 31, 2016 and 2015 . Share-Based Compensation —The Company follows FASB ASC 718, “Compensation-Stock Compensation” (ASC 718) to record share-based compensation for all employee share-based payment awards, including stock options, restricted stock and stock purchases related to an employee stock purchase plan, based on estimated fair values. The Company’s share-based compensation expense recognized under ASC 718 for the three months ended March 31, 2016 and 2015 was $2,842 and $1,724 , respectively, on a before and after tax basis. ASC 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Company’s Condensed Consolidated Statement of Operations and Comprehensive Loss. The expense has been reduced for estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company estimates the fair value of time-based options on the date of grant using the Black-Scholes option-pricing model (Black-Scholes model). The Company’s determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by the Company’s stock price, as well as assumptions regarding a number of subjective variables. These variables include but are not limited to the Company’s expected stock price volatility over the term of the awards and actual and projected employee stock option exercise behaviors. The fair value of market-based performance option grants is estimated at the date of grant using a Monte-Carlo simulation. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Consolidated Statement of Operations and Comprehensive Loss. The Company estimates the fair value of restricted stock based upon the grant date closing market price of the Company’s common stock. The Company’s determination of fair value is affected by the Company’s stock price as well as assumptions regarding the number of shares expected to be granted. The Company also has an employee stock purchase plan (ESPP) which is available to all eligible employees as defined by the plan document. Under the ESPP, shares of the Company’s common stock may be purchased at a discount. The Company estimates the number of shares to be purchased under the ESPP and records compensation expense based upon the fair value of the stock at the beginning of the purchase period using the Black-Scholes model. Use of Estimates —The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. Fair Value Disclosures —The Company classifies and records cash and investments in U.S. government agencies and securities as Level 1 within the fair value hierarchy. Accounts receivable, short-term other assets, accounts payable and accrued liabilities are also classified as Level 1. The carrying amounts of these assets and liabilities approximate their fair value due to their relatively short-term nature. Cash equivalents and investments in corporate bonds are classified as Level 2 within the fair value hierarchy (see Note 3 – Fair Value for further information). Significant unobservable inputs with respect to the fair value measurement of the Level 3 contingent consideration liabilit y is developed using Company data. When an input is changed, the corresponding valuation models are updated and the results are analyzed for reasonableness. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2016 | |
Recent Accounting Pronouncements [Abstract] | |
Recent Accounting Pronouncements | 2. RECENT ACCOUNTING PRONOUNCEMENTS In May 2014 the FASB issued a final standard on revenue from contracts with customers. The standard, issued as FASB ASU 2014-09, “ Revenue from Contracts with Customers” (ASU 2014-09), outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. In July 2015 the FASB decided to defer the effective date of ASU 2014-09 for entities reporting under U.S. GAAP from interim and annual reporting periods beginning after December 15, 2016 to interim and annual reporting periods beginning after December 15, 2017 and allow early adoption as of the original effective date. A full retrospective or modified retrospective approach may be taken to adopt the guidance in the ASU. The Company is evaluating the impact of the provisions of ASU 2014-09 on its consolidated financial position, results of operations and related disclosures. In November 2015 the FASB issued ASU 2015-17, “Income Taxes (Topic 740), Balance Sheet Classification of Deferred Taxes” (ASU 2015-17), which requires companies to classify all deferred tax assets and liabilities as noncurrent on the balance sheet instead of separating deferred taxes into current and noncurrent amounts. Also, companies will no longer allocate valuation allowances between current and noncurrent deferred tax assets because those allowances also will be classified as noncurrent. ASU 2015-17 is effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted for financial statements that have not been issued. The Company has evaluat ed the impact of the provisions of ASU 2015-17 on its consolidated financial position and related disclosures and has determined that the new guidance does not have a material impact on its financial reporting . In January 2016 the FASB issued ASU 2016-01, “Financial Instruments — Overall — Recognition and Measurement of Financial Assets and Financial Liabilities” (ASU 2016-01), which amends the guidance in U.S. GAAP on the classification and measurement of financial instruments. Although the ASU retains many current requirements, it significantly revises an entity’s accounting related to (1) the classification and measurement of investments in equity securities and (2) the presentation of certain fair value changes for financial liabilities measured at fair value. The ASU also amends certain disclosure requirements associated with the fair value of financial instruments. The new standard is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2017. The Company is evaluating the impact of ASU 2016-01 on its consolidated financial position and related disclosures. In February 2016 the FASB issued ASU 2016-02, “Leases” (ASU 2016-02) which requires lessees to record most leases on to their balance shee t but recognize expenses on their income statement in a manner similar to today’s accounting. The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Entities are required to use a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. Full retrospective application is prohibited. The Company is evaluating the provisions of ASU 2016-02 to determine the impact on its consolidated financial position and related disclosures. In March 2016 the FASB issued ASU 201 6 - 09 , “ Improvements to Employee Share-Based Payment Accounting ” (ASU 201 6 - 09 ), which changes certain aspects of accounting for share-based payments to employees . The new guidance requires all income tax effects of awards to be recognized in the income statement when the awards vest or are settled. It also allows an employer to repurchase more of an employee’s shares for tax withholding purposes without triggering liability accounting and to make a policy election to account for forfeitures as they occur. ASU 201 6-09 i s effective for fiscal years beginning after December 15, 2016, and interim periods within those years . Early adoption is permitted, but all of the guidance within the ASU must be adopted in the same period. The Company is evaluating the impact of ASU 2016-09 on its consolidated financial position, results of operations and related disclosures . |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value [Abstract] | |
Fair Value | 3. FAIR VALUE FASB ASC 820, “Fair Value Measurements and Disclosures” (ASC 820) defines fair value 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. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following: · Level 1—Quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. An active market for the asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. The valuation under this approach does not entail a significant degree of judgment. · Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. The valuation technique for the Company’s Level 2 assets is based on quoted market prices for similar assets from observable pricing sources at the reporting date. · Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Unobservable inputs shall be used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. The fair value of the Company’s Level 3 contingent consideration liability was estimated on the acquisition date of nContact Surgical, Inc. (nContact) and i s revalued at the end of each subsequent reporting period. In accordance with ASC 820, the following table represents the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2016 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Total Assets: Money market funds $ — $ 13,041 $ — $ 13,041 U.S. government agencies and securities 1,580 — — 1,580 Corporate bonds — 7,125 — 7,125 Total assets $ 1,580 $ 20,166 $ — $ 21,746 Liabilities: Acquisition-related contingent consideration — — 40,207 40,207 Total liabilities $ — $ — $ 40,207 $ 40,207 There were no changes in the levels or methodology of measurement of financial assets and liabilities during the three month period ended March 31, 2016 . In accordance with ASC 820, the following table represents the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2015 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Total Assets: Money market funds $ — $ 18,572 $ — $ 18,572 U.S. government agencies and securities 1,590 — — 1,590 Corporate bonds — 16,930 — 16,930 Total assets $ 1,590 $ 35,502 $ — $ 37,092 Liabilities: Acquisition-related contingent consideration — — 40,207 40,207 Total liabilities $ — $ — $ 40,207 $ 40,207 There were no changes in the levels or methodology of measurement of financial assets and liabilities during the twelve months ended December 31, 2015 . Acquisition-Re lated Contingent Consideration. Contingent consideration arrangements obligate the Company to pay former shareholders of an acquired entity if specified future events occur or conditions are met, such as the achievement of certain technological milestones or the achievement of targeted revenue milestones. The Company measures such liabilities using unobservable inputs, applying the income approach, such as the discounted cash flow technique or the probability-weighted scenario method. Various key assumptions, such as the probability of achievement of the agreed milestones, projected revenues from acquisitions and the discount rate, are used in the determination of fair value of contingent consideration arrangements and are not observable in the market, thus representing a Level 3 measurement within the fair value hierarchy. Subsequent revisions to key assumptions, which impact the estimated fair value of contingent consideration liabilities, are reflected in the Condensed Consolidated Statements of Operations and Comprehensive Loss. The Company acquired nContact on October 13, 2015. The aggregate consideration paid to nContact shareholders includes up to $50,000 in contingent consideration based on completion of enrollment of the CONVERGE IDE trial and corresponding PMA approval by December 31, 2020. nContact shareholders are entitled to additional contingent consideration based on revenue in excess of an annual growth rate of more than 25% through 2019. There were no changes in the estimates, discount rate or measurement period during the three months ended March 31, 2016. The following table represents the Company’s Level 3 fair value measurements using significant other unobservable inputs for acquisition-related contingent consideration as of March 31, 2016: Beginning Balance – January 1, 2016 $ 40,207 Amounts acquired — Transfers in (out) of Level 3 — Changes in fair value included in earnings — Ending Balance – March 31, 2016 $ 40,207 The following table represents the Company’s Level 3 fair value measurements using significant other unobservable inputs for acquisition-related contingent consideration as of December 31, 2015 : Beginning Balance – January 1, 2015 $ — Amounts acquired 40,207 Transfers in (out) of Level 3 — Changes in fair value included in earnings — Ending Balance – December 31, 2015 $ 40,207 |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2016 | |
Intangible Assets [Abstract] | |
Intangible Assets | 4. INTANGIBLE ASSETS The following table provides a summary of the Company’s intangible assets: March 31, December 31, 2016 2015 Cost Accumulated Amortization Cost Accumulated Amortization Non-compete agreement $ 100 $ 100 $ 100 $ 100 Fusion technology 9,242 2,079 9,242 1,848 Clamp & probe technology 829 622 829 552 Estech trade name 208 208 208 208 SUBTLE access technology 2,179 206 2,179 96 IPR&D 44,021 — 44,021 — Total $ 56,579 $ 3,215 $ 56,579 $ 2,804 Amortization expense related to intangible assets with definite lives was $411 and $303 for the three months ended March 31, 2016 and 2015 , respectively. Future amortization expense related to intangible assets with definite lives is projected as follows: 2016 $ 1,233 April 1, 2016 through December 31, 2016 2017 1,367 2018 1,367 2019 1,367 2020 1,235 2021 and thereafter 2,774 Total $ 9,343 |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Mar. 31, 2016 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | 5. ACCRUED LIABILITIES Accrued liabilities consisted of the following: March 31, December 31, 2016 2015 Accrued payroll and employee-related expenses $ 4,694 $ 4,021 Accrued commissions 3,045 6,061 Accrued taxes and value-added taxes payable 2,214 912 Accrued bonus 1,565 6,088 Other accrued liabilities 807 723 Accrued royalties 398 382 Sales returns allowance 208 207 Total $ 12,931 $ 18,394 |
Indebtedness
Indebtedness | 3 Months Ended |
Mar. 31, 2016 | |
Indebtedness [Abstract] | |
Indebtedness | 6. INDEBTEDNESS Bank Credit Facility. The Company has a debt agreement (Loan Agreement) with Silicon Valley Bank (SVB). The Loan A greement, as amended, restated and modified, includes a $15,000 revolvi ng credit facility which matures on April 30, 2018 . Borrowing availability under the revolving credit facility is based on the lesser of $15,000 or a borrowing base calculation as defined by the Loan A greement. As of March 31, 2016 the Company had no borrowings under the revolving credit facility and had borrowing availability of $15,000 . The applicable interest rate is 3.5% . Effective April 25, 2016, the Company and SVB entered into the Second Amended and Restated Loan and Security Agreement which amends and restates the Company’s credit facility with SVB. The agreement provides for a new $25,000 term loan, in addition to a $15,000 revolving line of credit, both which mature in April 2021 . The term loan has a five -year term, with principal payments to be made ratably commencing twelve months after the inception of the loan through to the loan’s maturity date. If the Company meets certain conditions, as specified by the loan agreement, the commencement of term loan principal payments may be deferred by an additional six months. The term loan accrues interest at the Prime Rate and is subject to an additional 4.0% fee on the original $25,000 term loan principal amount at maturity. The revolving line of credit is subject to an annual commitment fee of $50 , and any borrowings bear interest at the Prime Rate. The Second Amended and Restated Loan and Security Agreement also provides for certain prepayment and early termination fees, as well as establishes covenants related to liquidity, sales growth and a minimum cash balance, along with other terms and conditions similar to those in the Company’s previous agreements with SVB. The proceeds from the agreement are expected to fund current and future operations of the Company. Capital Lease Obligations. As of March 31, 2016 the Company had capital leases for its corporate headquarters building and computer equipment that expire at various terms through 2030 . In August 2014, t he Company entered into a new building lease (Mason Lease) in order to re-locate its corporate headquarters and West Chester, Ohio facilities from their current location to a building to be constructed on Innovation Way in Mason, Ohio. The term of the Mason Lease is fifteen years with three separate five -year renewal options, at the Company’s option, and commenced in Octo ber 2015. On the Commencement Date, the Company provide d a letter of credit to the Landlord in the amount of $1,250 , which amount may decrease or be removed entirely based on the Company’s financial performance. The Company wa s deemed the owner of the project during the construction period. As a result, project costs incurred during construction of the building were included in property and equipment as construction in progress and the corresponding financing obligation wa s included in other current liabilities during the construction period . I ncrease s in purchases of building under construction and proceeds from the construction financing obligation we re also included in the Condensed Consolidated Statement of Cash Flows during the construction period . Upon completion of construction, t he Company recor ded the current and noncurrent portions of the Mason Lease obligation within capital leases and the va lue of the underlying asset in p roperty and e quipment in the Condensed Consolidated Balance Sheet . The cost of the leased assets , both building and computer equipment, under lease at March 31, 2016 was $14,462 . The assets are depreciated over their estimated useful lives, which equal the terms of the leases. Accumulated amortization on the capital leases was $597 at March 31, 2016 . Future maturities on capital lease obligations are projected as follows: 2016 $ 1,065 April 1, 2016 through December 31, 2016 2017 1,425 2018 1,439 2019 1,457 2020 1,479 2021 and thereafter 15,894 Total payments $ 22,759 Imputed interest (8,705) Net capital lease obligations, of which $462 is current and $13,592 is noncurrent $ 14,054 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 7. COMMITMENTS AND CONTINGENCIES Lease Commitments . The Company leases certain office, manufacturing and warehouse facilities and equipment under noncancelable operating leases that expire at various terms through 2021 . Royalty Agreements . The Company has certain royalty agreements in place with terms that include payment of royalties based on product revenue from sales of specified current products. The royalty agreements have effective dates as early as 2003 and terms ranging from three years to at least twenty years. The royalties range from 0.75% to 5% of specified product sales. Parties to the royalty agreements have the right at any time to terminate the agreement immediately for cause. Royalty expense of $441 and $427 was recorded as part of cost of revenue for the three months ended March 31, 2016 and 2015, respectively . Purchase Agreements . The Company enters into standard purchase agreements with certain vendors in the ordinary course of business. Outstanding commitments at March 31, 2016 and 2015 were not significant. Legal . The Company is not currently party to any material pending or threatened litigation. The Company may, from time to time, become a party to legal proceedings. |
Income Tax Provision
Income Tax Provision | 3 Months Ended |
Mar. 31, 2016 | |
Income Tax Provision [Abstract] | |
Income Tax Provision | 8. INCOME TAX PROVISION The Company files federal, state, and foreign income tax returns in jurisdictions with varying statutes of limitations. Income taxes are computed using the asset and liability method in accordance with FASB ASC 740, “Income Taxes”, under which deferred income taxes are provided for the temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities. Deferred taxes are measured using provisions of currently enacted tax laws. A valuation allowance against deferred tax assets is recorded when it is more-likely-than-not that such assets will not be fully realized. The Company has recorded a full valuation allowance against its net deferred tax assets as it is more-likely-than-not that the benefit of the deferred tax assets will not be recognized in future periods. Tax credits are accounted for as a reduction of income taxes in the year in which the credit originates. The Company does not expect any significant unrecognized tax benefits to arise over the next twelve months. The Company’s provision for income taxes for continuing operations in interim periods is computed by applying its estimated annual effective rate against its loss before income tax (expense) benefit for the period. In addition, non-recurring or discrete items are recorded during the period in which they occur. The effective tax rate for the three months ended March 31, 2016 and 2015 was (0.05%) and (0.11%) , respectively. The Company has not had to accrue any interest and penalties related to unrecognized income tax benefits as a result of offsetting of net operating losses. However, if the situation occurs, the Company will recognize interest and penalties within the income tax expense (benefit) line in the Condensed Consolidated Statements of Operations and Comprehensive Loss and within the related tax liability line in the Condensed Consolidated Balance Sheets. Federal, state and local tax returns of the Company are routinely subject to review by various taxing authorities. |
Equity Compensation Plans
Equity Compensation Plans | 3 Months Ended |
Mar. 31, 2016 | |
Equity Compensation Plans [Abstract] | |
Equity Compensation Plans | 9. EQUITY COMPENSATION PLANS The Company has several share-based incentive plans: the 2005 Equity Incentive Plan (2005 Plan), the Amended and Restated 2014 Stock Incentive Plan (2014 Plan) and the 2008 Employee Stock Purchase Plan (ESPP). 2005 Plan and 2014 Plan The Company granted awards under the 2005 Plan until the 2014 Annual Meeting of Stockholders at which stockholders adopted the 2014 Plan. Pursuant to its terms, the 2014 Plan supersedes and replaces the 2005 Plan. Under the 2014 Plan, the Board of Directors may grant incentive stock options to employees and any parent or subsidiary’s employees, and may grant nonstatutory stock options, restricted stock or stock appreciation rights to employees, directors and consultants of the Company and any parent or subsidiary’s employees, directors and consultants. The administrator (currently the Compensation Committee of the Board of Directors) has the power to determine the terms of any awards, including the number of shares subject to each award, the exercisability of the awards and the form of consideration. As of March 31, 2016 , 8,949 shares of common stock had been reserved for issuance under the 2014 Plan. Options granted under the plans generally expire ten years fr om the date of grant. Options granted from the 2005 Plan and 2014 Plan generally vest at a rate of 25% on the first anniversary date of the grant and ratably each month thereafter over the following three years . Restricted stock awards granted under the 2005 Plan and 2014 Plan generally vest 25% annually over four years from date of grant. Employee Stock Purchase Plan (ESPP) T he Employee Stock Purchase Plan is available to eligible employees as defined in the ESPP. Under the ESPP, shares of the Company’s common stock may be purchased at a discount (currently 15% ) of the lesser of the closing price of the Company’s common stock on the first trading day or the last trading day of the offering period. The offering period (currently six months) and the offering price are subject to change. Participants may not purchase more than $25 of the Company’s common stock in a calendar year and, effective January 1, 2014, may not purchase a value of more than 3 shares during an offering period. Beginning on January 1, 2009 and on the first day of each fiscal year thereafter during the term of the ESPP, the number of shares available for sale under the ESPP shall be increased by the lesser of (i) two percent ( 2% ) of the Company’s outstanding shares of common stock as of the close of business on the last business day of the prior calendar year, not to exceed 600 shares, or (ii) a lesser amount determined by the Board of Directors. At March 31, 2016 there were 491 shares available for future issuance under the ESPP. Expense Information Under FASB ASC 718 The following table summarizes share-based compensation expense related to employee s under FASB ASC 718 for the three months ended March 31, 2016 and 2015 . This expense was allocated as follows: Three Months Ended March 31, 2016 2015 Cost of revenue $ 139 $ 90 Research and development expenses 479 289 Selling, general and administrative expenses 2,224 1,345 Total share-based compensation expense related to employees $ 2,842 $ 1,724 |
Segment and Geographic Informat
Segment and Geographic Information | 3 Months Ended |
Mar. 31, 2016 | |
Segment and Geographic Information [Abstract] | |
Segment and Geographic Information | 10. SEGMENT AND GEOGRAPHIC INFORMATION The Company evaluates reporting segments in accordance with FASB ASC 280, “Segment Reporting”. The Company develops, manufactures, and sells devices designed primarily for the surgical ablation of cardiac tissue and systems designed for the exclusion of the left atrial appendage. These devices are developed and marketed to a broad base of medical centers in the United States and internationally. Management considers all such sales to be part of a single reportable segment. Revenue attributed to geographic areas is based on the location of the customers to whom products are sold. Revenue by geographic area was as follows: Three Months Ended March 31, 2016 2015 United States $ 28,272 $ 22,923 Europe 4,761 4,416 Asia 2,728 2,300 Other international 179 247 Total international 7,668 6,963 Total revenue $ 35,940 $ 29,886 Domestic revenue by product type was as follows: Three Months Ended March 31, 2016 2015 Open-heart ablation $ 13,968 $ 12,354 Minimally invasive ablation 6,725 4,347 AtriClip 6,848 5,503 Total ablation and AtriClip 27,541 22,204 Valve tools 731 719 Total domestic $ 28,272 $ 22,923 International revenue by product type was as follows: Three Months Ended March 31, 2016 2015 Open-heart ablation $ 4,472 $ 4,216 Minimally invasive ablation 2,164 1,968 AtriClip 865 671 Total ablation and AtriClip 7,501 6,855 Valve tools 167 108 Total international $ 7,668 $ 6,963 The majority of the Company’s long-lived assets are located in the United States. |
Description of Business and S16
Description of Business and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Description of Business and Summary of Significant Accounting Policies [Abstract] | |
Nature of the Business | Nature of the Business —AtriCure, Inc. was incorporated in the State of Delaware on October 31, 2000. The “Company” or “AtriCure” consists of AtriCure, Inc. and its wholly-owned subsidiaries. The Company is a leading atrial fibrillation (Afib) solutions partner providing innovative products, professional education and support for clinical science to reduce the economic and social burden of atrial fibrillation. The Company sells its products to medical centers globally through a direct sales force and distributors. |
Basis of Presentation | Basis of Presentation —The accompanying interim financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (SEC). The accompanying interim financial statements are unaudited, but in the opinion of the Company’s management, contain all of the normal, recurring adjustments considered necessary to present fairly the financial position, results of operations and cash flows for the periods presented in conformity with accounting principles generally accepted in the United States of America (GAAP) applicable to interim periods. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted or condensed. The Company believes the disclosures herein are adequate to make the information presented not misleading. Results of operations are not necessarily indicative of the results expected for the full fiscal year or for any future period. The accompanying Condensed Consolidated Financial Statements should be read in conjunction with the audited financial statements of the Company included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 filed with the SEC. |
Principles of Consolidation | Principles of Consolidation —The Condensed Consolidated Financial Statements include the accounts of the Company, AtriCure, LLC, Endoscopic Technologies, LLC and nContact Surgical, LLC, the Company’s wholly-owned subsidiar ies, all organized in the State of Delaware, and AtriCure Europe B.V. (AtriCure Europe), the Company’s wholly-owned subsidiary incorporated in the Netherlands. All intercompany accounts and transactions have been eliminated in consolidation. |
Cash and Cash Equivalents | Cash and Cash Equivalents —The Company considers highly liquid investments with maturities of three months or less at the date of acquisition as cash equivalents in the accompanying Condensed Consolidated Financial Statements. |
Investments | Investments —The Company places its investments primarily in U.S. Government agencies and securities, corporate bonds and commercial paper. The Company classifies all investments as available-for-sale. Investments with maturities of less than one year are classified as short-term investments. Investments are recorded at fair value, with unrealized gains and losses recorded as accumulated other comprehensive income (loss). The Company recognizes gains and losses when these securities are sold using the specific identification method and includes them in interest income or expense in the Condensed Consolidated Statements of Operations and Comprehensive Loss. |
Revenue Recognition | Revenue Recognition —The Company accounts for revenue in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 605, “Revenue Recognition” (ASC 605). The Company recognizes revenue when all of the following criteria are met: (i) there is persuasive evidence that an arrangement exists; (ii) delivery of the products and/or services has occurred; (iii) the selling price is fixed or determinable; and (iv) collectability is reasonably assured. Pursuant to the Company’s standard terms of sale, revenue is recognized when title to the goods and risk of loss transfers to customers and there are no remaining obligations that will affect the customers’ final acceptance of the sale. Generally, the Company’s standard terms of sale define the transfer of title and risk of loss to occur upon shipment to the respective customer. The Company generally does not maintain any post-shipping obligations to the recipients of the products. No installation, calibration or testing of products is performed by the Company subsequent to shipment to the customer in order to render it operational. Revenue includes shipping and handling revenue of $296 and $247 for the three months ended March 31, 2016 and 2015 , respectively. Cost of freight for shipments made to customers is included in cost of revenue. Sales and other value-added taxes collected from customers and remitted to governmental authorities are excluded from revenue. The Company sells its products primarily through a direct sales force, with certain international markets sold through distributors. Terms of sale are generally consistent for both end-users and distributors except that payment terms are generally net 30 days for end-users and net 60 days for distributors with limited exceptions. |
Sales Returns and Allowances | Sales Returns and Allowances —The Company maintains a provision for sales returns and allowances to account for potential returns of defective or damaged products, products shipped in error and invoice adjustments. The Company estimates such provision on a quarterly basis based primarily on specific identification, in addition to estimating a general reserve based on historical experience. Increases to the provision result in a reduction of revenue. The provision is included in accrued liabilities in the Condensed Consolidated Balance Sheets. |
Allowance for Doubtful Accounts Receivable | Allowance for Doubtful Accounts Receivable —The Company evaluates the collectability of accounts receivable to determine the appropriate reserve for doubtful accounts. In determining the amount of the reserve, the Company considers aging of account balances, historical credit losses, customer-specific information and other relevant factors. An increase to the allowance for doubtful accounts results in a corresponding increase in selling, general and administrative expense. The Company reviews accounts receivable and adjusts the allowance based on current circumstances and charges off uncollectible receivables against the allowance when all attempts to collect the receivable have failed. The Company’s history of write-offs against the allowance has not been significant. |
Inventories | Inventories —Inventories are stated at the lower of cost or market using approximate costs based on the first-in, first-out cost method (FIFO) . Inventories consist of raw materials, work in process and finished goods. The Company’s industry is characterized by rapid product development and frequent new product introductions. Uncertain timing of product approvals, variability in product launch strategies and variation in product utilization all impact excess and obsolete inventory. An inventory allowance based on product usage is estimated and recorded quarterly for excess, slow moving and obsolete inventory, as well as inventory with a carrying value in excess of its net realizable value. An increase to the inventory reserve allowance results in a corresponding increase in cost of revenue. Write-offs are recorded when a product is destroyed. The Company’s history of write-offs against the reserve has not been significant. Inventories consist of the following: March 31, December 31, 2016 2015 Raw materials $ 6,228 $ 6,159 Work in process 2,023 974 Finished goods 10,764 10,526 Inventories $ 19,015 $ 17,659 |
Property and Equipment | Property and Equipment —Property and equipment is stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method of depreciation for financial reporting purposes and is applied over the estimated useful lives of the assets. The estimated useful life by major asset category is the following: generators and other capital equipment, machinery, equipment and vehicles is three to seven years, computer and other office equipment is three years, furniture and fixtures is three to seven years and leasehold improvements and equipment under capital leases are the shorter of their useful life or remaining lease term. The Company reassesses the useful lives of property and equipment annually, and assets are retired if they are no longer in service. Maintenance and repair costs are expensed as incurred. Generators and other capital equipment (such as the Company’s switchbox units and cryosurgical consoles) are placed with direct customers that use the Company’s disposable products. Depreciation of such assets is included in cost of revenue. The estimated useful lives of this equipment are based on anticipated usage by customers and the timing and impact of expected new technology rollouts by the Company. To the extent the Company experiences changes in the usage of this equipment or introduces new technologies, the estimated useful lives of this equipment may change in a future period. Depreciation related to these generators was $836 and $620 for the three months ended March 31, 2016 and 2015 , respectively. As of March 31, 2016 and December 31, 2015 , the net carrying amount of loaned equipment included in net property and equipment in the Condensed Consolidated Balance Sheets was $5,393 and $5,447 , respectively. The Company reviews property and equipment for impairment using its best estimates based on reasonable and supportable assumptions and projections. |
Intangible Assets | Intangible Assets —Intangible assets with determinable useful lives are amortized on a straight-line basis over the estimated periods benefited. Included in intangible assets is In Process Research and Development (IPR&D). The Company defines IPR&D as the value of acquired technology which has not yet reached technological feasibility. The primary basis for determining the technological feasibility is obtaining specific regulatory approvals. The estimated fair value of IPR&D acquired in a business combination is capitalized as an indefinite-lived intangible asset until completion or abandonment of the IPR&D project. Upon completion of the development project, the IPR&D is amortized over its estimated useful life. If the IPR&D project is abandoned, the related IPR&D asset is written off. The estimated fair value of IPR&D was determined using an income approach model. IPR&D represents an estimate of the fair value of the PMA approval that could result from the CONVERGE IDE clinical trial. The Company reviews intangible assets for impairment using its best estimates based on reasonable and supportable assumptions and projections. |
Goodwill | Goodwill— Goodwill represents the excess of purchase price over the fair value of the net assets acquired in business combinations. The Company tests goodwill for impairment annually on November 30, or more often if impairment indicators are present. The Company’s goodwill is accounted for in a single reporting unit representing the Company as a whole. |
Other Current Liabilities and Current Maturities of Capital Leases | Other Current Liabilities and Current Maturities of Capital Leases— As of March 31, 201 6 , o ther current liabilities consisted of a financing obligation related to the construction of the Company’s new headquarters. Current maturities of capital leases consist of capital lease obligations with maturities of less than one year (see Note 6 – Indebtedness). |
Other Noncurrent Liabilities | Other Noncurrent Liabilities— Other noncurrent liabilities include contingent consideration recorded in business combinations, as well as long-term deferred revenues and other contractual obligations. |
Other Income | Other Income — Other income consists primarily of foreign currency transaction gains and losses. The Company recorded net foreign currency transaction gains (losses) of $(80) and $(163) for the three months ended March 31, 2016 and 2015 , respectively, in connection with settlements of its intercompany balance with AtriCure Europe and invoices transacted in British Pounds. |
Taxes | Taxes —Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities from a change in tax rates is recognized in the period that includes the enactment date. The Company’s estimate of the valuation allowance for deferred tax assets requires it to make significant estimates and judgments about its future operating results. Deferred tax assets are reduced by valuation allowances if, based on the consideration of all available evidence, it is more-likely-than-not that some portion of the deferred tax asset will not be realized. Significant weight is given to evidence that can be objectively verified. The Company evaluates deferred tax assets on a quarterly basis to determine if valuation allowances are required by considering all available evidence. Deferred tax assets are realized by having sufficient future taxable income to allow the related tax benefits to reduce taxes otherwise payable. The sources of taxable income that may be available to realize the benefit of deferred tax assets are future reversals of existing taxable temporary differences, future taxable income, exclusive of reversing temporary differences and carryforwards, taxable income in carry-back years and tax planning strategies that are both prudent and feasible. In evaluating whether to record a valuation allowance, the applicable accounting standards deem that the existence of cumulative losses in recent years is a significant piece of objectively verifiable negative evidence that must be overcome by objectively verifiable positive evidence to avoid the need to record a valuation allowance. The Company has recorded a full valuation allowance against its net deferred tax assets as it is more likely than not that the benefit of the deferred tax assets will not be recognized in future periods. A provision of The Patient Protection and Affordable Care Act enacted in 2010, as amended (Patient Act), requires manufacturers of medical devices to pay an excise tax on all U.S. medical device sales. In December 2015, the U.S. gove rnment approved the suspension of the excise tax on medical device sales beginning January 1, 2016 through December 31, 2017. The Company’s expense related to the medical device excise tax, which was recorded in cost of revenue, was $0 and $155 for the three months ended March 31, 2016 and 2015 , respectively. |
Net Loss Per Share | Net Loss Per Share —Basic and diluted net loss per share is computed in accordance with FASB ASC 260, “Earnings Per Share” (ASC 260) by dividing the net loss by the weighted average number of common shares outstanding during the period. Since the Company has experienced net losses for all periods presented, net loss per share excludes the effect of 4,480 and 4,320 stock options and restricted stock shares as of March 31, 2016 and 2015 , respectively, because they are anti-dilutive. Therefore the number of shares calculated for basic net loss per share is also used for the diluted net loss per share calculation. |
Comprehensive Loss and Accumulated Other Comprehensive Loss | Comprehensive Loss and Accumulated Other Comprehensive Loss —In addition to net losses, the comprehensive loss includes foreign currency translation adjustments and unrealized gains and losses on investments. Accumulated other comprehensive income (loss) consisted of the following: Three Months Ended March 31, 2016 2015 Total accumulated other comprehensive loss at beginning of period $ (611) $ (348) Unrealized Gains on Investments Balance at beginning of period $ (39) $ (54) Other comprehensive income (loss) before reclassifications 41 37 Amounts reclassified from accumulated other comprehensive income to other income on the statement of operations — — Balance at end of period $ 2 $ (17) Foreign Currency Translation Adjustment Balance at beginning of period $ (572) $ (294) Other comprehensive income (loss) before reclassifications 281 (324) Amounts reclassified from accumulated other comprehensive income to other income on the statement of operations 5 (163) Balance at end of period $ (286) $ (781) Total accumulated other comprehensive loss at end of period $ (284) $ (798) |
Research and Development | Research and Development —Research and development costs are expensed as incurred. These costs include compensation and other internal and external costs associated with the development and research related to new and existing products or concepts, preclinical studies, clinical trials, healthcare compliance and regulatory affairs. |
Advertising Costs | Advertising Costs — The Company expenses advertising costs as incurred. Advertising costs were not significant during the three months ended March 31, 2016 and 2015 . |
Share-Based Compensation | Share-Based Compensation —The Company follows FASB ASC 718, “Compensation-Stock Compensation” (ASC 718) to record share-based compensation for all employee share-based payment awards, including stock options, restricted stock and stock purchases related to an employee stock purchase plan, based on estimated fair values. The Company’s share-based compensation expense recognized under ASC 718 for the three months ended March 31, 2016 and 2015 was $2,842 and $1,724 , respectively, on a before and after tax basis. ASC 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Company’s Condensed Consolidated Statement of Operations and Comprehensive Loss. The expense has been reduced for estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company estimates the fair value of time-based options on the date of grant using the Black-Scholes option-pricing model (Black-Scholes model). The Company’s determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by the Company’s stock price, as well as assumptions regarding a number of subjective variables. These variables include but are not limited to the Company’s expected stock price volatility over the term of the awards and actual and projected employee stock option exercise behaviors. The fair value of market-based performance option grants is estimated at the date of grant using a Monte-Carlo simulation. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Consolidated Statement of Operations and Comprehensive Loss. The Company estimates the fair value of restricted stock based upon the grant date closing market price of the Company’s common stock. The Company’s determination of fair value is affected by the Company’s stock price as well as assumptions regarding the number of shares expected to be granted. The Company also has an employee stock purchase plan (ESPP) which is available to all eligible employees as defined by the plan document. Under the ESPP, shares of the Company’s common stock may be purchased at a discount. The Company estimates the number of shares to be purchased under the ESPP and records compensation expense based upon the fair value of the stock at the beginning of the purchase period using the Black-Scholes model. |
Use of Estimates | Use of Estimates —The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. |
Fair Value Disclosures | Fair Value Disclosures —The Company classifies and records cash and investments in U.S. government agencies and securities as Level 1 within the fair value hierarchy. Accounts receivable, short-term other assets, accounts payable and accrued liabilities are also classified as Level 1. The carrying amounts of these assets and liabilities approximate their fair value due to their relatively short-term nature. Cash equivalents and investments in corporate bonds are classified as Level 2 within the fair value hierarchy (see Note 3 – Fair Value for further information). |
Description of Business and S17
Description of Business and Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Description of Business and Summary of Significant Accounting Policies [Abstract] | |
Summary Of Inventories | Inventories consist of the following: March 31, December 31, 2016 2015 Raw materials $ 6,228 $ 6,159 Work in process 2,023 974 Finished goods 10,764 10,526 Inventories $ 19,015 $ 17,659 |
Accumulated Other Comprehensive Income (Loss) | Accumulated other comprehensive income (loss) consisted of the following: Three Months Ended March 31, 2016 2015 Total accumulated other comprehensive loss at beginning of period $ (611) $ (348) Unrealized Gains on Investments Balance at beginning of period $ (39) $ (54) Other comprehensive income (loss) before reclassifications 41 37 Amounts reclassified from accumulated other comprehensive income to other income on the statement of operations — — Balance at end of period $ 2 $ (17) Foreign Currency Translation Adjustment Balance at beginning of period $ (572) $ (294) Other comprehensive income (loss) before reclassifications 281 (324) Amounts reclassified from accumulated other comprehensive income to other income on the statement of operations 5 (163) Balance at end of period $ (286) $ (781) Total accumulated other comprehensive loss at end of period $ (284) $ (798) |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value [Abstract] | |
Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | In accordance with ASC 820, the following table represents the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2016 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Total Assets: Money market funds $ — $ 13,041 $ — $ 13,041 U.S. government agencies and securities 1,580 — — 1,580 Corporate bonds — 7,125 — 7,125 Total assets $ 1,580 $ 20,166 $ — $ 21,746 Liabilities: Acquisition-related contingent consideration — — 40,207 40,207 Total liabilities $ — $ — $ 40,207 $ 40,207 There were no changes in the levels or methodology of measurement of financial assets and liabilities during the three month period ended March 31, 2016 . In accordance with ASC 820, the following table represents the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2015 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Total Assets: Money market funds $ — $ 18,572 $ — $ 18,572 U.S. government agencies and securities 1,590 — — 1,590 Corporate bonds — 16,930 — 16,930 Total assets $ 1,590 $ 35,502 $ — $ 37,092 Liabilities: Acquisition-related contingent consideration — — 40,207 40,207 Total liabilities $ — $ — $ 40,207 $ 40,207 There were no changes in the levels or methodology of measurement of financial assets and liabilities during the twelve months ended December 31, 2015 . |
Level 3 Fair Value Measurements Using Significant Other Unobservable Inputs for Acquisition-Related Contingent Consideration | The following table represents the Company’s Level 3 fair value measurements using significant other unobservable inputs for acquisition-related contingent consideration as of March 31, 2016: Beginning Balance – January 1, 2016 $ 40,207 Amounts acquired — Transfers in (out) of Level 3 — Changes in fair value included in earnings — Ending Balance – March 31, 2016 $ 40,207 The following table represents the Company’s Level 3 fair value measurements using significant other unobservable inputs for acquisition-related contingent consideration as of December 31, 2015 : Beginning Balance – January 1, 2015 $ — Amounts acquired 40,207 Transfers in (out) of Level 3 — Changes in fair value included in earnings — Ending Balance – December 31, 2015 $ 40,207 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Intangible Assets [Abstract] | |
Company's Intangible Assets with Definite Lives | The following table provides a summary of the Company’s intangible assets: March 31, December 31, 2016 2015 Cost Accumulated Amortization Cost Accumulated Amortization Non-compete agreement $ 100 $ 100 $ 100 $ 100 Fusion technology 9,242 2,079 9,242 1,848 Clamp & probe technology 829 622 829 552 Estech trade name 208 208 208 208 SUBTLE access technology 2,179 206 2,179 96 IPR&D 44,021 — 44,021 — Total $ 56,579 $ 3,215 $ 56,579 $ 2,804 |
Future Amortization Expense Related to Intangible Assets with Definite Lives | Future amortization expense related to intangible assets with definite lives is projected as follows: 2016 $ 1,233 April 1, 2016 through December 31, 2016 2017 1,367 2018 1,367 2019 1,367 2020 1,235 2021 and thereafter 2,774 Total $ 9,343 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | Accrued liabilities consisted of the following: March 31, December 31, 2016 2015 Accrued payroll and employee-related expenses $ 4,694 $ 4,021 Accrued commissions 3,045 6,061 Accrued taxes and value-added taxes payable 2,214 912 Accrued bonus 1,565 6,088 Other accrued liabilities 807 723 Accrued royalties 398 382 Sales returns allowance 208 207 Total $ 12,931 $ 18,394 |
Indebtedness (Tables)
Indebtedness (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Indebtedness [Abstract] | |
Future Maturities on Capital Lease Obligations | Future maturities on capital lease obligations are projected as follows: 2016 $ 1,065 April 1, 2016 through December 31, 2016 2017 1,425 2018 1,439 2019 1,457 2020 1,479 2021 and thereafter 15,894 Total payments $ 22,759 Imputed interest (8,705) Net capital lease obligations, of which $462 is current and $13,592 is noncurrent $ 14,054 |
Equity Compensation Plans (Tabl
Equity Compensation Plans (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Equity Compensation Plans [Abstract] | |
Share-Based Compensation Expense Related to Employee Share-Based Compensation | The following table summarizes share-based compensation expense related to employee s under FASB ASC 718 for the three months ended March 31, 2016 and 2015 . This expense was allocated as follows: Three Months Ended March 31, 2016 2015 Cost of revenue $ 139 $ 90 Research and development expenses 479 289 Selling, general and administrative expenses 2,224 1,345 Total share-based compensation expense related to employees $ 2,842 $ 1,724 |
Segment and Geographic Inform23
Segment and Geographic Information (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Segment and Geographic Information [Abstract] | |
Revenue by Geographic Area | Revenue by geographic area was as follows: Three Months Ended March 31, 2016 2015 United States $ 28,272 $ 22,923 Europe 4,761 4,416 Asia 2,728 2,300 Other international 179 247 Total international 7,668 6,963 Total revenue $ 35,940 $ 29,886 |
Revenue by Product Type | Domestic revenue by product type was as follows: Three Months Ended March 31, 2016 2015 Open-heart ablation $ 13,968 $ 12,354 Minimally invasive ablation 6,725 4,347 AtriClip 6,848 5,503 Total ablation and AtriClip 27,541 22,204 Valve tools 731 719 Total domestic $ 28,272 $ 22,923 International revenue by product type was as follows: Three Months Ended March 31, 2016 2015 Open-heart ablation $ 4,472 $ 4,216 Minimally invasive ablation 2,164 1,968 AtriClip 865 671 Total ablation and AtriClip 7,501 6,855 Valve tools 167 108 Total international $ 7,668 $ 6,963 |
Description of Business and S24
Description of Business and Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Description Of Business And Significant Accounting Policies [Line Items] | |||
Shipping and handling revenue | $ 296 | $ 247 | |
Payment terms for end-users | 30 days | ||
Payment terms for distributors | 60 days | ||
Depreciation | $ 1,800 | 1,008 | |
Net carrying amount of loaned equipment | 31,155 | $ 31,279 | |
Foreign currency transaction (losses) gains | (5) | 251 | |
Company's expense related to the medical device excise tax | $ 0 | $ 155 | |
Options, restricted stock and performance based shares excluded from calculation of net loss per share | 4,480 | 4,320 | |
Share-based compensation expense recognized | $ 2,842 | $ 1,724 | |
Subsidiaries [Member] | |||
Description Of Business And Significant Accounting Policies [Line Items] | |||
Foreign currency transaction (losses) gains | $ (80) | (163) | |
Computer and Other Office Equipment [Member] | |||
Description Of Business And Significant Accounting Policies [Line Items] | |||
Estimated useful life by major asset category | 3 years | ||
Generators [Member] | |||
Description Of Business And Significant Accounting Policies [Line Items] | |||
Depreciation | $ 836 | $ 620 | |
Carrying Amount of Loaned Equipment [Member] | |||
Description Of Business And Significant Accounting Policies [Line Items] | |||
Net carrying amount of loaned equipment | $ 5,393 | $ 5,447 | |
Short-term Debt [Member] | |||
Description Of Business And Significant Accounting Policies [Line Items] | |||
Maturity period of short term investment | 1 year | ||
Minimum [Member] | Generators and Other Capital Equipment, Machinery, Equipment and Vehicles [Member] | |||
Description Of Business And Significant Accounting Policies [Line Items] | |||
Estimated useful life by major asset category | 3 years | ||
Minimum [Member] | Furniture and Fixtures [Member] | |||
Description Of Business And Significant Accounting Policies [Line Items] | |||
Estimated useful life by major asset category | 3 years | ||
Maximum [Member] | Generators and Other Capital Equipment, Machinery, Equipment and Vehicles [Member] | |||
Description Of Business And Significant Accounting Policies [Line Items] | |||
Estimated useful life by major asset category | 7 years | ||
Maximum [Member] | Furniture and Fixtures [Member] | |||
Description Of Business And Significant Accounting Policies [Line Items] | |||
Estimated useful life by major asset category | 7 years |
Description of Business and S25
Description of Business and Summary of Significant Accounting Policies (Summary Of Inventories) (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Description of Business and Summary of Significant Accounting Policies [Abstract] | ||
Raw materials | $ 6,228 | $ 6,159 |
Work in process | 2,023 | 974 |
Finished goods | 10,764 | 10,526 |
Inventories | $ 19,015 | $ 17,659 |
Description of Business and S26
Description of Business and Summary of Significant Accounting Policies (Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Total accumulated other comprehensive (loss) income, at beginning of period | $ (611) | $ (348) |
Total accumulated other comprehensive (loss) income, at end of period | (284) | (798) |
Unrealized (Losses) Gains on Investments [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Total accumulated other comprehensive (loss) income, at beginning of period | (39) | (54) |
Other comprehensive income (loss) before reclassifications | $ 41 | $ 37 |
Amounts reclassified from accumulated other comprehensive income (loss) to other income | ||
Total accumulated other comprehensive (loss) income, at end of period | $ 2 | $ (17) |
Foreign Currency Translation Adjustment [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Total accumulated other comprehensive (loss) income, at beginning of period | (572) | (294) |
Other comprehensive income (loss) before reclassifications | 281 | (324) |
Amounts reclassified from accumulated other comprehensive income (loss) to other income | 5 | (163) |
Total accumulated other comprehensive (loss) income, at end of period | $ (286) | $ (781) |
Fair Value (Narrative) (Details
Fair Value (Narrative) (Details) - nContact Surgical [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Oct. 13, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Acquisition-related contingent consideration | $ 50,000 | |
Entitled sales-based contingent consideration on revenue in excess of annual growth through 2019 | 25.00% |
Fair Value (Financial Assets an
Fair Value (Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Assets: | ||
Total assets | $ 21,746 | $ 37,092 |
Liabilities: | ||
Acquisition-related contingent consideration | 40,207 | 40,207 |
Total liabilities | 40,207 | 40,207 |
Money Market Funds [Member] | ||
Assets: | ||
Total assets | 13,041 | 18,572 |
U.S. Government Agencies and Securities [Member] | ||
Assets: | ||
Total assets | 1,580 | 1,590 |
Corporate Bonds [Member] | ||
Assets: | ||
Total assets | 7,125 | 16,930 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Assets: | ||
Total assets | 1,580 | $ 1,590 |
Liabilities: | ||
Acquisition-related contingent consideration | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | U.S. Government Agencies and Securities [Member] | ||
Assets: | ||
Total assets | 1,580 | $ 1,590 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Assets: | ||
Total assets | 20,166 | $ 35,502 |
Liabilities: | ||
Acquisition-related contingent consideration | ||
Significant Other Observable Inputs (Level 2) [Member] | Money Market Funds [Member] | ||
Assets: | ||
Total assets | 13,041 | $ 18,572 |
Significant Other Observable Inputs (Level 2) [Member] | Corporate Bonds [Member] | ||
Assets: | ||
Total assets | 7,125 | 16,930 |
Significant Other Unobservable Inputs (Level 3) [Member] | ||
Liabilities: | ||
Acquisition-related contingent consideration | 40,207 | 40,207 |
Total liabilities | $ 40,207 | $ 40,207 |
Fair Value (Level 3 Fair Value
Fair Value (Level 3 Fair Value Measurements Using Significant Other Unobservable Inputs for Acquisition-Related Contingent Consideration) (Details) - Significant Other Unobservable Inputs (Level 3) [Member] - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Beginning Balance | $ 40,207 | |
Amounts acquired | $ 40,207 | |
Transfers in (out) of Level 3 | ||
Changes in fair value included in earnings | ||
Ending Balance | $ 40,207 | $ 40,207 |
Intangible Assets (Narative) (D
Intangible Assets (Narative) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Intangible Assets [Abstract] | ||
Amortization of intangible assets | $ 411 | $ 303 |
Intangible Assets (Company's In
Intangible Assets (Company's Intangible Assets with Definite Lives) (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 56,579 | $ 56,579 |
Accumulated Amortization | 3,215 | 2,804 |
Non-Compete Agreement [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 100 | 100 |
Accumulated Amortization | 100 | 100 |
Fusion Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 9,242 | 9,242 |
Accumulated Amortization | 2,079 | 1,848 |
Clamp and Probe Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 829 | 829 |
Accumulated Amortization | 622 | 552 |
Estech Trade Name [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 208 | 208 |
Accumulated Amortization | 208 | 208 |
SUBTLE Access Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 2,179 | 2,179 |
Accumulated Amortization | 206 | 96 |
IPR&D [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 44,021 | $ 44,021 |
Intangible Assets (Future Amort
Intangible Assets (Future Amortization Expense Related to Intangible Assets with Definite Lives) (Details) $ in Thousands | Mar. 31, 2016USD ($) |
Intangible Assets [Abstract] | |
2,016 | $ 1,233 |
2,017 | 1,367 |
2,018 | 1,367 |
2,019 | 1,367 |
2,020 | 1,235 |
2021 and thereafter | 2,774 |
Total | $ 9,343 |
Accrued Liabilities (Accrued Li
Accrued Liabilities (Accrued Liabilities) (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Accrued Liabilities [Abstract] | ||
Accrued payroll and employee-related expenses | $ 4,694 | $ 4,021 |
Accrued commissions | 3,045 | 6,061 |
Accrued taxes and value-added taxes payable | 2,214 | 912 |
Accrued bonus | 1,565 | 6,088 |
Other accrued liabilities | 807 | 723 |
Accrued royalties | 398 | 382 |
Sales returns allowance | 208 | 207 |
Total | $ 12,931 | $ 18,394 |
Indebtedness (Narrative) (Detai
Indebtedness (Narrative) (Details) $ in Thousands | Apr. 25, 2016USD ($) | Mar. 31, 2016USD ($)loan |
Line of Credit Facility [Line Items] | ||
Cost of assets under lease | $ 14,462 | |
Accumulated amortization on the capital leases | 597 | |
Maximum [Member] | ||
Line of Credit Facility [Line Items] | ||
Letter of credit required to landlord | 1,250 | |
Silicon Valley Bank Agreement [Member] | Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of credit, maximum borrowing capacity | $ 15,000 | |
Credit facility maturity date | Apr. 30, 2018 | |
Line of credit, outstanding | $ 15,000 | |
Line of credit, availability | $ 0 | |
Applicable interest rate | 3.50% | |
Silicon Valley Bank, Second Amended And Restated Loan Agreement [Member] | Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Credit facility maturity date | Apr. 30, 2021 | |
Interest rate description | The term loan accrues interest at the Prime Rate and is subject to an additional 4.0% fee on the original $25,000 term loan principal amount at maturity. The revolving line of credit is subject to an annual commitment fee of $50, and any borrowings bear interest at the Prime Rate. | |
Silicon Valley Bank, Second Amended And Restated Loan Agreement [Member] | Revolving Credit Facility [Member] | Subsequent Event [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of credit, maximum borrowing capacity | $ 15,000 | |
Line of credit, outstanding | $ 25,000 | |
Line of Credit Facility, Expiration Period | 5 years | |
Principal payment starting period after inception of loan to maturity | 12 months | |
Upon certain conditions met, deferred loan payment period | 6 months | |
Additional fee on total term loan | 4.00% | |
Annual commitment fee | $ 50 | |
Computer And Office Equipment [Member] | ||
Line of Credit Facility [Line Items] | ||
Capital lease expiration period | Dec. 31, 2030 | |
Mason Lease [Member] | ||
Line of Credit Facility [Line Items] | ||
Lease term period | 15 years | |
Number of renewal options | loan | 3 | |
Lease renewal option period | 5 years |
Indebtedness (Future Maturities
Indebtedness (Future Maturities on Capital Lease Obligations) (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Indebtedness [Abstract] | ||
2,016 | $ 1,065 | |
2,017 | 1,425 | |
2,018 | 1,439 | |
2,019 | 1,457 | |
2,020 | 1,479 | |
2021 and thereafter | 15,894 | |
Total payments | 22,759 | |
Imputed interest | (8,705) | |
Net capital lease obligations, of which $462 is current and $13,592 is noncurrent | 14,054 | |
Net capital lease obligations, current | 462 | |
Net capital lease obligations, noncurrent | $ 13,592 | $ 13,710 |
Commitments and Contingencies (
Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Commitments and Contingencies [Line Items] | ||
Royalty expense | $ 441 | $ 427 |
Minimum [Member] | ||
Commitments and Contingencies [Line Items] | ||
Royalty rates | 0.75% | |
Royalty agreement term | 3 years | |
Maximum [Member] | ||
Commitments and Contingencies [Line Items] | ||
Royalty rates | 5.00% | |
Royalty agreement term | 20 years | |
Office, Manufacturing, Warehouse Facilities, And Equipment [Member] | ||
Commitments and Contingencies [Line Items] | ||
Operating leases expire at various terms | Dec. 31, 2021 |
Income Tax Provision (Narrative
Income Tax Provision (Narrative) (Details) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Tax Provision [Abstract] | ||
Effective tax rate | (0.05%) | (0.11%) |
Equity Compensation Plans (Narr
Equity Compensation Plans (Narrative) (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2016USD ($)shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Description of participants purchase limit | Participants may not purchase more than $25 of the Company's common stock in a calendar year and, effective January 1, 2014, may not purchase a value of more than 3 shares during an offering period. |
Participants purchase limit shares | 3,000 |
Offering period | 6 months |
2005 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expiry of options from the date of grant | 10 years |
2014 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expiry of options from the date of grant | 10 years |
Shares reserved for issuance | 8,949,000 |
2008 Employee Stock Purchase Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Company's common stock may be purchased at a discount | 15.00% |
Participants purchase limit value | $ | $ 25 |
Shares available for sale under the ESPP increased | 2.00% |
Outstanding shares of common stock exceed | 600,000 |
Shares available for future issuance under the ESPP | 491,000 |
Employee Stock Option [Member] | 2005 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Exercisable period beginning | 3 years |
Employee Stock Option [Member] | 2014 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Exercisable period beginning | 3 years |
Restricted Stock [Member] | 2005 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 4 years |
Restricted Stock [Member] | 2014 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 4 years |
First Anniversary Date Of Grant [Member] | Employee Stock Option [Member] | 2005 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Annual vesting percentage | 25.00% |
First Anniversary Date Of Grant [Member] | Employee Stock Option [Member] | 2014 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Annual vesting percentage | 25.00% |
Four Years From Date Of Grant [Member] | Restricted Stock [Member] | 2005 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Annual vesting percentage | 25.00% |
Four Years From Date Of Grant [Member] | Restricted Stock [Member] | 2014 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Annual vesting percentage | 25.00% |
Equity Compensation Plans (Shar
Equity Compensation Plans (Share-Based Compensation Expense Related to Employee Share-Based Compensation) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation expense related to employees | $ 2,842 | $ 1,724 |
Cost of Revenue [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation expense related to employees | 139 | 90 |
Research and Development Expenses [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation expense related to employees | 479 | 289 |
Selling, General and Administrative Expenses [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation expense related to employees | $ 2,224 | $ 1,345 |
Segment and Geographic Inform40
Segment and Geographic Information (Revenue by Geographic Area) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenue | $ 35,940 | $ 29,886 |
United States [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenue | 28,272 | 22,923 |
Europe [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenue | 4,761 | 4,416 |
Asia [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenue | 2,728 | 2,300 |
Other International [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenue | 179 | 247 |
International [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenue | $ 7,668 | $ 6,963 |
Segment and Geographic Inform41
Segment and Geographic Information (Revenue by Product Type) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenue from External Customer [Line Items] | ||
Revenue | $ 35,940 | $ 29,886 |
United States [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | 28,272 | 22,923 |
United States [Member] | Open-heart Ablation [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | 13,968 | 12,354 |
United States [Member] | Minimally Invasive Ablation [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | 6,725 | 4,347 |
United States [Member] | AtriClip [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | 6,848 | 5,503 |
United States [Member] | Ablation and AtriClip [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | 27,541 | 22,204 |
United States [Member] | Valve Tools [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | 731 | 719 |
International [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | 7,668 | 6,963 |
International [Member] | Open-heart Ablation [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | 4,472 | 4,216 |
International [Member] | Minimally Invasive Ablation [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | 2,164 | 1,968 |
International [Member] | AtriClip [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | 865 | 671 |
International [Member] | Ablation and AtriClip [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | 7,501 | 6,855 |
International [Member] | Valve Tools [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenue | $ 167 | $ 108 |